Even though a slowdown from some of our regular customers decreased our sales, we found new opportunities to offset them.
How has Charlotte Chemical evolved over the last five years?
We expanded in size, but we have also specialized more in some areas of the business. We currently represent several additional specialty chemical companies and, as a result, we have identified challenges in different areas. One is in sales, where we have had to learn quickly in order to be able to help our customers understand how to use new and innovative products that are more environmentally friendly. Our job is to help them get through the testing and trials to the point where they can put the product into use.
Another challenge we had is that with the growth of our business, we needed to reorganize our supply chain. We are now much more solid in this area. We have a full team that analyzes the most efficient and cost effective way to bring a product from overseas. We have also made great progress in becoming a more professional team; today we have our own distribution center in Mexico City. In 2015, we still were not certified by Responsible Care (RI). Since last year we received our certification with 97% of accomplishment, well in excess of the requirements.
Lastly, in 2018 we started working with the labeling of GHS (General Harmonized System) for Mexico, which is a classification standard for chemical products all over the world, where you need to label all your products in order to transport them and to warehouse them. We were the first chemical distributor in the country to achieve this requirement.
How would you assess the state of the PVC and Coatings markets?
PVC is a solid market because, even though the plastics industry is being punished by the public in general, PVC is perceived in a more positive light. This is largely because it is different from other plastics because the major application is in long term usage products rather than single use. In fact, a recent investigation found that from all the garbage collected in the disposal areas, PVC accounted for less than 1% of the total garbage, and not even 5% of the total plastics in the garbage. The market for PVC has continued its growth and it has changed over the years, because every year you see more sustainable products, green plasticizers, and other additives. Charlotte Chemical is always looking for new and best alternatives to help our customers innovate and be successful in their developments.
In coatings, the industry has also changed, specifically due to the new regulations on VOC's. Consequently, there is higher demand for more green products that meet the new standards. Companies are now looking for new ways of plasticizing films without toxic products or with the least solvents possible, that can work anywhere even in the toughest weather conditions.
How has the pandemic affected Charlotte Chemical’s sales?
Our sales dropped by about 30% in the beginning of the pandemic. However, our business has seen a strong recovery over the ensuing months because we have a strong team of leaders with innovative and creative ideas for rapidly developing better value propositions to our customers. Thus, our sales for 2020 will be about the same as they were in 2019, which in my point of view is a great success. I am very proud of our team for this accomplishment.
Even though a slowdown from some of our regular customers decreased our sales, we found new opportunities to offset them. You cannot see those increased sales right now, but when our clients who were badly impacted recover, that will mean our sales revenue will grow.
What goals does Charlotte Chemical seek to achieve in the next three years?
This year, we have defined three new goals: get a stronger portfolio of chemical specialties, increase our market share, and establish our own distribution center in Mexico City.
We have added products from three European specialty producers to our portfolio, and we are negotiating some others in the near future. We are looking to increase our sales talent in order to assist more customers to achieve a larger share of the market. Our new distribution center is the first of three that we plan to open around the country. In addition to the one in Mexico City, we plan to open a second facility in Monterrey and a third one in the West.