Could you update us on First Quality Chemical’s activities in 2023?

This year has been particularly exciting, as we participated in many trade shows: UTECH, a polyurethane industry event, Expo Cosmetica for personal care, Plastimagen, and of course the ANIQ Forum. We also sponsored the ANAFAPYT convention. 

As part of our anniversary celebrations, we hosted an event in Mexico City called ‘Circo del Color’. We invited our customers and brought technical experts from around the world who gave technical presentations about innovative materials, trends and new technologies. They offered innovative technical advice for our customers on how they can improve their performance, develop new materials, solve technical issues and also formulations to reduce costs.

What is the importance of innovation at First Quality Chemicals? 

Innovation is crucial for us, and we experiment with many materials to stay ahead of the industry. Our partners are some of the best companies in the world, investing significantly in R&D and developing new materials. At First Quality, we always want to be the first to bring those materials into the Mexican market. Our applications lab works with our customers to understand their needs; identify their pain points and determine how our laboratory can develop custom formulations to help them to achieve their goals. Innovative solutions are at the core of our growth model. To give you an example, we recently got a new material from Shell. We discovered a new application for this material that allowed our customers to reduce the consumption by 50%. 

What trends in demand are you witnessing? 

Our customers are interested in new materials to differentiate themselves from their competitors. There is strong demand across our entire product suite; coatings, inks, plastics, polyurethane, adhesives and personal care. There is also demand for environmentally sustainable products, so we also offer UV stabilizers, antioxidants, and other kinds of materials that increase the longevity of plastics. We also offer compatibilizer materials that augment the recyclability of materials. 

What kind of challenges do specialty chemical distributors face?

Specialty chemicals tend to become commodities over time, as they are diffused across the industry and lose their novelty and uniqueness. Therefore, we are always looking for new, innovative materials that can disrupt the market. The timeless challenge for distributors is to keep changing, to find and commercialize these new materials. 

What is the greatest challenge facing the chemical industry? 

In 2022, the industry faced logistics challenges, and many companies were desperate to get their hands on the necessary raw materials. As a result, there has been some overstocking across the industry. This has created a downward pressure on pricing and demand over 2023, as many warehouses are full. There has been some erosion of margins across the industry. However, the reduction in demand is worldwide, not specific to Mexico, and I expect it to be temporary. 

What differentiates First Quality Chemicals from its competitors?

Our number one success factor is our people. They are our most precious resource. Our hiring process is very careful and extensive, with psychometric assessments, multiple interviews and references required. We hire great chemists and chemical engineers who work in our labs and provide technical support to our customers. At First Quality Chemicals, we have built an exceptional work culture, with ample opportunity for progression.  We work hard to develop our employees, so that they are happy and successful at their work. We offer many opportunities for training in areas such as marketing, leadership, negotiation, innovation, emotional intelligence, positive psychology as well as lots of technical training. To avoid repeating past mistakes, we implement fool proofing strong systems and procedures.  More than anything, we love to celebrate our people and our achievements, which has built a beautiful rapport within the firm. 

What is First Quality’s strategy for the coming years?

Our priority has always been organic growth, and we have been very successful in continually expanding our sales across many sectors. Looking to the future, if we want to grow more in Mexico and internationally, we are going to start looking at potential mergers and acquisitions. More than anything, I want to preserve the fantastic work culture that we have built here over the years. Keeping this culture intact would be our priority in any M&A deal.