The chemical industry is in the midst of a transformational change, driven by global decarbonization, technological advances, cost optimization needs, feedstock changes, and evolving trade dynamics. At BCG, our chemicals consulting team empowers businesses to master these forces, unlocking pathways to sustainable and profitable growth.
Chemicals today play a pivotal role beyond their traditional applications—and are key to achieving global decarbonization and enhancing efficiency across various industries. The future of the chemical industry hinges on its ability to adopt cutting-edge technologies and shift focus from volume to value. But as well as these chemical industry challenges, there are many opportunities, including emerging growth markets and innovative applications spurred by developments in electric vehicles, eco-friendly packaging, and other green solutions.
BCG’s chemicals consulting team draws on extensive expertise around the globe and along the entire chemical value chain. Based on our profound understanding of chemical industry trends, we shape the value creation agendas of chemical companies worldwide, implement efficient operating models, and boost the performance of company operations.
We serve a diverse range of clients, from global majors to regional and family-owned champions and start-ups as well as industry-leading associations and organizations. We advise across the complete breadth of chemical industry sectors, including petrochemicals, commodity plastics, specialty chemicals, biotechnology, agrochemicals, electronic chemicals, and chemical distribution.
By combining our deep industry expertise, proprietary tools, and proven approaches, we help our clients achieve their net zero roadmaps, create significant business value, realize profitable growth, and build winning strategies and capabilities—enabling them to achieve a tangible impact on their bottom line and on shareholder value.
Here are some of our main areas of focus:
BCG has proven experience helping chemical companies in five key areas:
Growth Strategy. One of Southeast Asia’s major petrochemical companies wanted to explore opportunities in specialty chemicals to counter the cyclical nature of its commodity-based business. BCG helped the client establish an M&A arm and update its business model to successfully integrate and derive value from new endeavors.
Post-Merger Integration. A European chemical conglomerate needed help with the integration of an acquired specialty chemical company. BCG helped the client streamline and maximize cost synergies for support functions and implement best practices to ensure high top-line synergies for all business activities. These synergies resulted in 11% of target sales—several percentage points above historical transactions.
Sales and Operations Planning. Poor planning at a batch-process chemical client created enterprise-wide problems that hurt market opportunities, sales, production, and working capital. With BCG’s assistance, the company streamlined sales and operations processes, which improved coordination between sales and production and resulted in a 30% increase in throughput and a 25% increase in on-time delivery.
Commercial Excellence. A lack of customer segmentation and a uniform pricing strategy hobbled a European chemical distributor’s go-to-market approach and disincentivized its salesforce. BCG worked with the client to roll out a commercial excellence plan that saved millions of euros and included tools to flag transactions with repricing potential and to support account managers’ build quotes. The plan also included price-tracking KPIs and related training and documentation.
Digital Transformation. As part of the broader chemical industry digital transformation, a Middle Eastern petrochemical client wanted to expand a digital and AI program in its operations to cover the entire enterprise. BCG helped the client create a three-year plan that encompassed several dozen digital initiatives for multiple business units. The plan included a detailed assessment of costs, enablers, and risks, among other factors.
BCG’s suite of leading-edge proprietary solutions and tools helps clients capitalize on the latest chemical industry trends by optimizing their operations and making smarter strategic decisions, including the following:
Our M&A tool gives clients a holistic understanding of deal activities in the chemical industry. By highlighting sectors and regions that are poised for consolidation or offer promising opportunities, it provides clients with actionable insights while identifying emerging players.
BCG’s Value Creation tool enables clients to identify the key drivers of both their own and their peers’ total shareholder returns. The tool dissects the contributions from different Total Shareholder Return (TSR) components over time, providing chemical companies with a detailed understanding of how to create value.
Our global chemical distribution market model synthesizes information from multiple sources and hundreds of data points from chemical principals and distributors to assess overall market development and forecast developments in specialty chemical products versus commodity products by geography. Our proprietary market model helps both specialty- and commodity-driven chemical distribution companies navigate strategic, M&A, and operational topics across segments and geographies.
Through sophisticated modelling, BCG’s Supply Curves tool helps clients assess the impact of capacity expansion, efficiency enhancements, and feedstock price volatility on their businesses’ performance. Detailed supply curves and customized scenarios allow us to forecast the cost competitiveness of different production sites worldwide—today and in the future.
Each year, we throw away nearly $200 billion of material that could be recycled. But companies can flip the script.
As the halcyon days of open markets and easy money wane, producers of metals, cement, chemicals, and other essential industrial imports face a tougher global environment.
In our most recent report, total shareholder return fell dramatically across the industry, rising only in emerging economies and a few product categories. Is this a temporary shock or a new normal?
Carbon transformation, or CO2 to X, is rapidly emerging as an economically viable alternative to fossil-fuel-based chemical production. To stay on top of these sustainability trends in the chemical industry, big companies need to engage.
Our chemicals consulting team helps companies around the world and across the chemical value chain—from petrochemical companies and specialty chemical products players to chemical distribution companies—shape their growth strategies, navigate decarbonization in chemicals, and tap AI’s potential so they can achieve the next level of performance. Here are some of our leaders on the topic.
