j&m presentation.ppt

Prepared by:Kevin Puttock, Reed Business Insight

On behalf of:

ICIS / J&M – Chemicals Market Survey ‘09

April 2009Reference Number: 4983

ICIS / J&M chemical market survey ‘09

2

Contents

• Background & Objectives

• Methodology

• Respondent Profile

• Main findings

• Key findings

• Appendix

Slide 3

Slides 5 - 12

Slides 13 - 34

Slides 35 - 36

Slides 37 - 49

Slide 4


3

Background & Objectives

• Global financial traumas, lack of business confidence and a sharp fall-off in chemical demand are forcing companies to take critical short-term actions as they focus on surviving the crunch.

• Research was required by ICIS and J&M Management Consulting to measure the current pulse of the industry and find out how chemical industry executives are reacting in these unprecedented times.

• Research will be used by ICIS primarily for editorial purposes


4

Methodology

• The survey was conducted as an online self completion quantitative survey sent by email to registered readers of ICIS Chemical Business.

• The survey was incentivised with a prize draw to win an iPod Touch.

• Fieldwork was conducted over a 3 week period from 2nd – 22nd April, 2009.

• In total 275* respondents completed the survey.

* Although this is a typical response for a survey of this kind, it is still low overall and it should be remembered that the majority of prospective respondents did not reply. Therefore care must be exercised when interpreting the results as those non-respondents may differ in their profile and views. In addition, a self completion survey tends to be biased towards the more loyal readers of a publication.


5

• Respondent Profile• Job position• Length of time spent working in the chemicals industry• Geographic location• Segments operating within• Global revenue• Number of employees• Organisation ownership status


Around a quarter of respondents are CEO’s, Chairmen or Presidents of their organisations

6Base: all respondents (269)

Q. Which of the following job titles best reflects your position?

6


Around three quarters of respondents have been working in the industry for more than 10 years


Q. How many years have you been working in the chemicals industry?

7


39% of respondents work for organisations based in North America, followed by 20% in Europe and 17% in India


Q. Where is your company based?

8


Respondents most commonly work for orgabnisations that operate within the specialty chemicals segment


Q. In which of the following segments does your company operate?

9


Just under half of respondents work for organisations with a global revenue of up to $500m


Q. What is the total global revenue of your company?

10


Just over half work for organisations that employ 500 people or less in total


Q. How many people does your organisation employ in total?

11


Around a third of respondents each work for organisations that are publicly listed, privately owned or family owned


Q. How would you describe the ownership status of your company?

12


13

• Main findings• Expectation of whether the downturn will continue• Change in demand over the next 12 months• Change in employment levels over the next 12 months• Expectation of whether respondent will still be employed in 12 months time• Expectation of debt defaults over the next 12 months• Expectations of changes in mergers and acquisitions activity• Importance of performance metrics• Change in working capital• Change in demand over last 6 months• Excess capacity• At risk suppliers• Renegotiating terms with suppliers• Importance of customer-focussed activities• Customer-focussed activities currently being used• Investment in R&D• Plans to bring new products to market• Employment actions taken• Agreement with opinion statements• Expectation of duration of downturn• Expectations of whether company will survive the downturn


Around two thirds of respondents believe the current downturn in demand will continue into Q2 of 2009


Q. Do you expect the sharp downturn in demand in Q4 2008 / Q1 2009 to continue in Q2?

14


Over a quarter of respondents expect demand in the chemical sector to decrease by more than 11% in the next 12 months. The majority of those that think demand will increase, believe it will be by 1-5%


Q. How do you expect demand in the chemical sector to change over the next 12 months?

15

Total decreased = 64%

Total increased = 28%


Over a third of respondents believe that the level of full time employment in the chemical sector will decrease by 6–15% in the next 12 months. Only 8% expect the level to increase


Q. How do you expect the levels of full-time employment in the sector to change over the next 12 months?

16




In terms of still being employed within the chemical sector in 12 months time confidence is relatively high, with 89% believing they definitely or probably will be


Q. Do you expect to still be employed within the chemical sector in 12 months time?

17

Total ‘yes’ = 89%


21% do not expect debt defaults from any of the company types listed. Those that expect some debt defaults most commonly expect them from major customers


Q. Do you expect any debt defaults / Chapter 11 / bankruptcy filings over the next 12 months from the following types of organisations?

18


Around half of the respondents believe that M&A / divestment activity will slightly increase in the chemical sector over the next 12 months


Q. How do you expect mergers and acquisitions / divestment activity in the chemical sector to change over the next 12 months?

19




Cash flow is rated as the most important performance metric at the moment. 44% feel that people turnover is a low level performance metric for their organisation

20Base: all respondents (various)

Q. Please rate the level of importance of each of the following performance metrics for your company at the moment?

20


In total, 59% of respondents identified that their company’s working capital has decreased since this time last year


Q. How has the level of your company's working capital changed since this time last year?

21




Three quarters of respondents report that their organisation’s level of demand has decreased over the last 6 months


Q. How has the level of demand changed for your company over the last 6 months?

22




Around a third of respondents’ organisations have taken none of the actions listed to manage output over the last 12 months. 30% have introduced short term shut-downs for additional / accelerated maintenance


Q. Which of the following actions has your company been using to manage output over the last 12 months?

23


38% of respondents report that 1-20% of the asset capacity is currently excess to demand


Q. What percentage of your asset capacity is excess to demand at the moment?

24


Around a third of respondents believe that none of their suppliers are at risk from interrupting supply, however 41% believe that 1-10% of their suppliers are at risk


Q. In terms of supporting at-risk suppliers and securing long-term delivery, what percentage of your suppliers are at risk of interrupting supply to you?

25


20% of respondents are renegotiating terms with more than 25% of their suppliers


Q. What percentage of your suppliers are you renegotiating terms with?

26


22% of respondents rated segmenting clients’ supply chain needs as having a high importance for their organisation


Q. In terms of changing your customer offerings, please rate the level of importance of each of the following customer-focused activities your company is pursuing at the moment?

27


Over a third of respondents rated changing the level of sales calls / customer touches as having a high level of importance for their organisation at the moment


Q. Please rate the level of importance of each of the following customer-facing activities your company is using at the moment?

28


Over half of respondents are not scaling back on their R&D / innovation investment


Q. Is your company scaling back on its investment in R&D / innovation?

29


Just under two thirds are planning to bring new innovations / products to market more quickly


Q. Does your company plan to bring new innovations / products to market more quickly?

30


The most common employment action taken is to freeze basic pay, followed by a permanent reduction in the headcount of full time employees


Q. With regards to people and employment, which of the following actions has your company taken?

31


60% agree that the chemicals industry is a worthwhile sector for employees to enter. 38% disagree strongly that the actions being taken by their company are detrimental to the long-term viability of the business


Q. To what extent do you agree or disagree with each of the following statements?

32

Total disagree = 48%

Total disagree = 45%


Just under half of respondents expect the downturn to last until the end of 2009


Q. Approximately how long do you expect the downturn in the chemicals sector to last?

33


Almost all believe their company will survive the downturn and the remaining 8% don’t know


Q. Do you think your company will survive the downturn / crunch?

34


35

• Key findings


36

Key findings

• For the majority of respondents’ organisations demand has decreased over the last 6 months and around two thirds of respondents expect demand in the chemical sector to decrease over the next 12 months

• Over three quarters expect the level of full-time employment in the sector to decrease, although the majority of respondents feel they will still be employed in the sector in 12 months time and 60% of respondents feel the sector is worthwhile for new employees to enter

• Over half of the organisations are not scaling back on their R&D investment and over half of the respondents plan to bring new innovations to market more quickly

• The most common employment action taken is to freeze basic pay

• Respondents typically expect the downturn to last until the end of 2009 or to the middle of 2010 and almost all believe their organisation will survive it.

Appendix


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Reed Business Insight provides business market expertise through innovative research solutions

We can help you gain a valuable insight into your market place allowing you to make informed business decisions

What are we offering?


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Why work with Reed Business Insight?

Reed Business Insight is the independent market research division of Reed Business Information which provides business market expertise through innovative research solutions

The close relationship with market-leading brands gives us the ability to reach specialist segments of our extensive database of business decision-makers via a range of research techniques

Our team of market research professionals have a wealth of experience across different business markets and can help you gain a valuable insight into your market place, allowing you to make informed business decisions and keep you one step ahead of your competitors

Through our market-leading brands we can also provide access to research on industry trends and market intelligence within business markets

All research commissioned by clients is undertaken on a strictly confidential basis

The Reed Business Insight team believe passionately about the services we offer clients and take great pride in the research that we undertake to make sure that it is reliable, cost effective and actionable

We are a friendly team that we hope you’ll enjoy working and discussing your research findings with


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What do we provide our clients?

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What are our values?

Passionate about researchWe are an honest team that enjoy working in research and take pride in our projects

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Independent professional serviceWe focus on flexible solutions through a reliable and professional service

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Actionable results We deliver meaningful findings and recommendations that can help businesses to grow


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Meet the project teamDiane Lewis, Head of Market Research. After graduating in Statistics from Bath University, Diane gained her first business-to-business research experience at BUPA. She now has 15+ years experience in research & is a full member of the Market Research Society. Diane is responsible for directing a high performance Research team and works across the whole portfolio of business markets, specialising in Property, IT, Road Transport & Travel. Tel: +44 (0208) 652 8065, email: [email protected]

Jan De Iulio, Key Account Manager. Jan will be your first point of contact and will help to identify your information requirements and guide you through the research process ensuring that any work undertaken fully meets your business objectives. Jan has worked in media and provided customers with marketing solutions for 20 years. Tel.+44 (0208) 652 8564, email: [email protected]

Kevin Puttock, Senior Research Executive. Since graduating in Marketing from the University of Plymouth, Kevin has gained several years research knowledge across the IT, science, property and financial sectors. Kevin first gained market research experience at The Research Factor. Tel: +44 (0208) 652 3742, email: [email protected]

Dan Hopper, Research Manager. Dan has over 9 year’s research experience. Initially working with Ipsos Mori and two specialist agencies he has particular expertise in online research methodologies, including panels and remote usability testing. Since joining Reed Business Insight in 2007 he has worked across a range of markets including social care, personnel and travel. Tel: +44 (0)20 8652 8192 email: [email protected]

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