A small marketplace launched by a giant German manufacturer is gaining traction in the global chemicals industry.
And high on the B2B ecommerce list of priorities for CheMondis, a marketplace for buying and selling chemicals and a wholly-owned subsidiary of Germany-based manufacturer Lanxess AG, is building a bigger base in the United States.
Lanxess, a chemicals manufacturer with annual sales of about $11.1 billion, rolled out CheMondis as an international B2B marketplace in 2018.
Today, CheMondis is active in 15 countries and is beginning to scale its operation in the U.S. for buyers and sellers of chemical products, including for a full-scale rollout next year.
The U.S. is a ‘significant market’
“We experimented in the second half of 2019 with selected pilot customers in the U.S.,” says CheMondis managing director Sebastian Brenner. “We are planning to look at a potential roll-out in the second half of 2020—the U.S. is a significant market for chemical products.”
Details on which U.S. chemical manufacturers, distributors and other buyers and sellers CheMondis is working with weren’t released, but globally CheMondis is making progress building up marketplace buyers and sellers in the $4.7 trillion chemicals industry.
A year ago, CheMondis had about 200 buyers and sellers that used the marketplace to directly negotiate individual terms and prices. Buyers could get instant order confirmations, maintain all transactions and related documentation, view product and supplier catalogs and see instant deals, among other tasks.
Now the number of chemical products buyers and sellers is about 1,400 and spread out across 15 countries.
Shift toward digital sales channels
More important, CheMondis has signed up about 12% of the 22,000 chemical companies in the European Union for its marketplace, Brenner says.
“Our customer feedback has changed fundamentally from when we launched in the end of 2018, and customers are today significantly more open towards using digital sales channels,” he says. “We are seeing customer registration numbers increase significantly in the last months.”
CheMondis is also seeing its business base grow in other areas. In the past year, gross merchandise volume on the marketplace grew to about $200 million and the number of electronic transactions exceeded 5,000.
The average transaction is about 55,000 Euro ($59,979 U.S.), a metric Brenner says is significant. “We are not selling a couple of kilos here and there,” he says. “The majority of our transactions are full truckload, full container load, industrial-scale chemicals.”
45,000 chemical products for sale online
Currently, there are about 45,000 chemicals products for sale on CheMondis, including specialty additives, thermoplastic polyurethanes, inorganic pigments, materials for manufacturing leather, and products for liquid purification and material protection.
Currently, the marketplace features about 20 industries, ranging from adhesives and sealants to water treatment, and 16 product groups including acids, agro-chemicals and solvents.
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