Supply Chain Collaboration Key to Retain Competitiveness of Gulf Chemical Indust

Collaboration in supply chain will be absolutely key to retain the global competitiveness of the Arabian Gulf chemical industry, says a new report by the Gulf Petrochemicals and Chemicals Association (GPCA).

With over 83% of GCC petrochemi-cal output destined for export to over 100 countries worldwide, the industry has the longest supply chain on a global level, making supply chain efficiency a crucial factor for maintaining the industry’s competitive advantage. Cost optimisation will be particularly important as the average cost associated with GCC chemical supply chains represents about 30% of landed product prices, which has a significant impact on chemical companies’ bottom line.

The report is based on findings of the ‘GPCA Supply Chain Collaboration Survey 2018’, which gauged the views of 19 GPCA member companies who collectively account for 75% of the total chemical output by volume in the Arabian Gulf. According to the survey, 52.6% of respondents see potential in securing various competitive advantages through intensifying collaboration.

A staggering 95% of the respondents said their organisation is taking strategic steps to improve collaboration with Logistics Service Providers (LSPs), with 84.2% seeing collaboration with LSPs as a crucial tool to enhance operational efficiency and optimise costs. Additional 26% of respondents identified mutual benefits and risk sharing as a driver for collaboration.

Dr. Abdulwahab Al Sadoun, Secretary General, GPCA, commented, “The survey results testify to the clear commitment by GPCA member companies to intensify collaboration with supply chain partners, particularly LSPs. With the pace of industry change accelerating in the coming years, collaboration throughout the value chain will be particularly important to realize and maintain the competitive advantage of the chemical industry in the Arabian Gulf.”