Orchestrating the chemicals supply chain to boost profitability

Balance challenging trade-offs

Serving a specialty and commodity market, chemicals supply chains are caught between the uncertainties of global demand and the push effects resulting from the various batch, campaign, and continuous or semicontinuous production flows. Assets must be used to their full potential, waste must be minimized, and margins assured. How can you balance all these challenging trade-offs? OMP is here to help chemical companies orchestrate demand and supply, maximizing asset utilization and setting out the right inventory strategies to boost profitability.

 

Demand pull challenge

Chemicals Industry

Demand for chemicals is very diverse and includes a broad range of base and intermediate chemicals, as well as a wide variety of specialty products. Base and intermediate chemical production chains create a wide variety of high-value and low-value co-products potentially off-balance with market demand. Businesses have to optimize their use of dedicated and non-dedicated tanks and warehouses all over the world. This has operational implications for loading and unloading too.

Production capacities need to be carefully planned to minimize changeovers, taking into account fixed-wheel and flexible-wheel policies, throttling decisions, and co-product fractions, and the actual performance of catalyst installations. Some businesses will have to optimize utilities consumption based on the variable price of steam and electricity. And decisions have to be made to prioritize certain demands, sell certain volumes on the spot market and reserve others for captive use.

The specialty products market has its own challenges. It relies on a mix of make-to-order and make-to-stock production strategies, is subject to stringent quality control processes and involves large networks of subcontractors and distribution channels. The need to carefully tune inventory levels adds to the complexity of it all.

 

Modeling the entire supply chain

chemicals supply chain

OMP takes care of all this. We know exactly how your supply chain works and we can model it to the necessary level of detail, which includes your production and storage installations, along with their input and output constraints and product and time-dependent rates.

We implement variable bills-of-material to manage co-product fractions, throttling, and recycling opportunities. Batch production processes are modeled too, allowing blends to be managed. We also model the service levels and constraints of your various contracts and swap deals.

Powerful forecasting techniques, value-driven solvers and scenario planning capabilities connect all ends to help you manage and coordinate your entire supply chain in unison. With this clear overview of supply and demand you can maximize asset utilization, keep inventory levels within reasonable limits, and reduce waste and costs.

 

Delighted

The result? Full end-to-end visibility aligns different departments, makes planning more effective and boosts overall profitability. Planners, managers and executives across your entire organization will be delighted.