Victoria: Business transformation is an ongoing theme.
I think there's no stability in my career
in the chemical industry, business transformation has
always been taking place.
It seems to be on a cycle, much like the cyclicality of the chemical industry.
In this case, what I think is really interesting, and I've had several
great conversations with leaders about this, is that it's really
market-centric and about really setting up for the next decade of success.
A key component of the modern world economy, the chemical
industry delivers products and innovations to enhance everyday life.
It is also an industry in transformation where chemical executives and
workers are delivering growth in industry changing advancements while
responding to pressures from investors, regulators and public opinion.
Discover how leading companies are approaching these challenges
here on The Chemical Show.
Join Victoria Meyer, president of Progressio Global and
host of The Chemical Show.
As she speaks with executives across the industry and learns how they are leading
their companies to grow, transform, and push industry boundaries on all frontiers.
Here's your host, Victoria Meyer.
Victoria: Hi, this is Victoria Meyer.
Welcome back to the Chemical Show Where Chemicals means Business.
In today's episode, I am sharing key themes from the 2024 American
Cleaning Institute annual meeting.
Otherwise known as ACI.
Over 1300 people from across the cleaning industry, representing
surfactants and other ingredient manufacturers, formulators, brand
owners, and consumer products companies, and industrial products companies
attended this year's event in Orlando.
The conference theme Advancing Cleaning Innovation was apparent
throughout the conference
and the conversations.
So I'm here today to share some of the themes that I picked up from
the event, and if you and your team are wondering how you're going
to deliver your goals in 2024.
If you've got some of these themes on your target and need some support,
send me a message on LinkedIn.
You can find me there at Victoria King Meyer, and let's have a
call to discuss how we can help.
So on to the conference I'm sharing today six themes that I picked
up throughout the conference.
First of all innovation was key and it was clear in the theme and in
the theme title of the conference.
The topic of several panels and showcase sessions that ACI produced
and the topic of a lot of conversation
innovation is here across several facets.
Product innovation, process innovation, and even business
and business approach innovation.
And from a product perspective, what we're seeing and this is a theme
that's continuing on for a couple years, is a lot of green products
and bio-based products that were showcased throughout the conference.
We're gonna talk more about that later.
The other innovation theme is really around formulation.
As a leading distributor shared with me, formulation innovation is back after the
tumultuous 2020 to 2022 timeframe, right?
With COVID and destocking and supply chain challenges, companies were stretched thin.
They were more focused on getting the right product for their
current formulations than really innovating on new formulations.
And then with the destocking and cost controls that we saw in 23,
some of that formulation specific innovation dried up a little bit.
What we're hearing today is it is back companies.
Companies are more willing to invest.
They're pivoting in some cases and focusing on the future with innovative
product and business opportunities.
Now.
Back to that green product innovation.
As one leading bio surfactant producer said, you may actually have to reformulate
the entire formula in order to accommodate some of the differences that you're
seeing with some of these new products.
So that's an interesting twist on formulation innovation.
But what I think we're seeing in what I was hearing is.
Across the entire value chain from a cleaning products perspective,
surfactants, fragrances, all the different additives.
Companies are really considering what their next formulation is and
getting more innovative with those products and those innovations.
So that's one.
The second key thing that came through was restocking.
Now, I gotta be honest, that was a bit of a surprise when people
said, oh yeah, we're having a great January, and we are seeing companies
and our customers restocking.
I think that's a bit application and market specific, and that's certainly what
I heard from several of the companies.
So they're not necessarily seeing restocking and but they're seeing
better buying behaviors than perhaps we saw at the end of 2023.
But.
This is something that's coming through.
Cost control is still here.
But it appears really that some companies and some sectors have
exhausted their destocking and are starting to refill their stores.
Now, there is still a lot of just in time inventory.
So nobody is planning that far ahead because there's some uncertainty around
what is really going to transpire in 2024.
And overall, people were.
Moderate about the market.
So I would not say that there was a strong confidence in terms of what the market
is going to be in 2024, but certainly there was a sense that we may be in
stable times and notice my word choice.
I'm still hedging my bets a little bit here as are others, but I think we're
starting to see some stability across the industry and potentially some restocking.
So stay tuned.
If you're seeing that, let me know.
The third thing that came through is AI.
AI was everywhere.
It was definitely a central topic throughout the event, just like
it's a central topic elsewhere.
And it featured in several sessions hosted by a CI with panelists ranging from
consumer products companies like p and g and Clorox to AI companies like Noble ai.
In fact, you may recall, Ethan Murky of Noble AI was featured on episode 99 of The
Chemical Show, talking about science-based AI and how it can be used to accelerate
product and formula innovations.
So go check it out, episode 99.
And while AI was really featured quite strongly in the programming, it also
was part of the conversation and the conversations that I had, it became
apparent, many companies and many leaders just aren't sure where to start.
So while the biggest companies.
Companies like p and g and Clorox that I've already referenced have
been investing in utilizing AI for a long time within their businesses.
At the same time, there are many companies that are just now starting to figure
out where they wanna go with this.
And there's a lot of uncertainty.
One of the things I heard even from someone is that chemical companies
are still just reluctant to trust, not just AI, but even to trust the cloud.
If you think about where we are in the world today, cloud-based
computing is everywhere, but perhaps not so much in the chemical industry.
Companies and leaders are really trying to figure out where to
start and how to safely start, how to utilize it effectively.
So I've got a download for you guys.
So head over to the show notes.
If you're listening in the podcast app, either Apple or Spotify
or whatever app you're using.
Or go to the episode page for the ChemicalShow.com and you can
get a download on a downloaded.
You can download a document on best practices in using AI in your
business, and I've got some tips for how to use it effectively as well
as some of my favorite tools that I think you will enjoy using yourself.
So go check it out, head on over to TheChemicalShow.com, and again,
get that download on best practices in using AI in your business.
So , AI is everywhere, right?
So my fourth theme on this is market-centric business transformation.
So business transformation is an ongoing theme.
I think there's no stability in my career throughout
in the chemical industry, business transformation has
always been taking place.
It seems to be on a cycle, much like the cyclicality of the chemical industry.
In this case, what I think is really interesting, and I've had several
great conversations with leaders about this, is that it's really
market-centric and about really setting up for the next decade of success.
And so a couple examples I had.
One was really around realigning the business and shifting from
a product centric business.
Organization and orientation to a market-centric orientation for
their businesses fundamentally to drive better customer experience
and to meet market requirements.
And so it's a opportunity to be more effective, to be more collaborative.
Internally and externally with customers to create that
market-centric business transformation.
The second piece is really around looking for new market opportunities, right?
And rethinking traditional end uses and traditional markets, and going
beyond what is currently seen.
For companies in the industry.
So market-centric business transformation is here.
We're starting to see it across many companies, and I think it's
gonna be a real focus in 2024.
My fifth theme is about.
Continuing the green.
So if you remember last year we talked a little bit about being green and
buggy, and that was one of the key themes that came out of the conference.
Bio-based ingredients and green innovation continues on and in fact, a
CI hosted a couple of innovation panels with speakers from leading companies,
including Eastman, Hollifirm, Pilot, Sasol, and others, talking about their
bio surfactant innovations, and really they're bio-based ingredient innovations.
What's interesting, I think is number one, there's a lot of evolution in this
space and definitely a lot of focus.
It's innovation, it's market-centric, it's sustainability-centric.
There's also a lot of collaboration and partnership coming through.
So certainly we see companies like Holli Firm and integrity biochemical.
Partnering up with other companies that are able to maybe more effectively take
it to market, have a different market reach and really help expand the impact.
So I think this is what we're gonna continue to see from a bio-based
ingredient perspective, a continuing partnering perspective, and just frankly
continuing for this industry to continue being on a green and sustainable path.
The sixth theme that came through.
I look at maybe the first five is a bit more opportunistic and positive.
The sixth theme was a little bit worrisome and it's around tightening regulations.
So a lot of this is European driven.
The eus tend to be the leader in some cases, and I'm not sure if it's
a good or bad leader, you guys have heard me talk about this before.
But the EO EU is a leader in driving some tighter regulations.
One topic that has been.
It was a hot topic throughout the conference is EUDR, so the European
Deforestation Regulation which applies stringent and risk-based guidelines to
specific products coming into the EU.
As you can imagine, the word deforestation is the key theme in
there, the things that are tied to the forest in the surfactant space.
Products derived from palm oil are in the spotlight.
And one of the things I heard more than anything is, there's been a lot
of regulation and there's been some practices already put in place across
the industry to recognize the risks and the potential harm that comes
in some of the farming of palm oil.
So there's already been a lot of work going on to ensure,
effective regulations and protocols and requirements are in place.
This goes a step or two or three further and there seems to be some
concern about how are companies really going to meet this.
And so I think watch this space, stay tuned to the news and how
this progresses on as companies are trying to figure out how they're
managing this new deforestation regulation coming out of the EU.
The second one that came out was really around dioxane.
So one four Dioxane has been in the spotlight for the past several years,
certainly in the US as well as globally, and companies have really figured
out how to navigate around that.
The current regulations are formulation base.
They're setting a target amount of one four dioxane in the
formulation in the applications
. In the industry, companies across the industry have really teamed up to
understand how to adjust to that, how to adapt, and how to meet those requirements.
Huh.
Now there's a new regulation coming outta Germany that focuses on one
four dioxane in the raw materials at a pretty low level that quite
honestly, I think companies are still
figuring out how are they going to tackle this.
So I think, I would say regulations is maybe one of the key themes.
And frankly, this is an area that a CI and other industry groups really
help pave the way and lead the way for other constituents to provide both
consensus, to provide that feedback to the governing bodies and more so stay
tuned in terms of where that's gonna go.
But that is.
Theme number six, coming out of the a CI 2024 annual conference.
In general, the mood I would say was upbeat, but measured, so
ACI has said this was a record attendance over 1300 registrants
from across the global industry.
And I think that's important to recognize.
And I would say overall people were positive, looking forward
to the year, uncertain about how it was going to progress.
And certainly what we've seen and what we've heard on The Chemical Show and
what you guys have heard elsewhere in the markets is that there's some concerns
about how the year is going to progress.
It's a little foggy.
It's perhaps a little flat until we get to the second half of the year.
But certainly what we're hearing is positive forward progress
across a number of fronts.
An upbeat mood.
Tempered by some very pragmatic views on and concerns.
And frankly, just watch this space on how the industry is gonna progress.
So that is it for this year's update from the 2024 ACI annual meeting.
I'd love to hear what you had to say.
If you were at the conference.
What did you hear?
Does this align with you?
Reach out, send me an email, shoot me a DM on LinkedIn.
Would love to hear from you and love to respond.
Thanks again for listening to The Chemical Show.
Keep listening, keep following, keep sharing, and we will
talk with you again soon.
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