How Polymers Bind the Future – Eight Answers
Interview with Peter Summo, president of WACKER POLYMERS
From 2007 to 2017, WACKER POLYMERS almost doubled its sales. What are the ingredients in your recipe for success?
Peter Summo: We sell a binder. That may not sound like much, but with sales soon to reach a million metric tons per year, we are twice as big as our nearest rival. We are the only supplier who serves the global market with vinyl acetate-ethylene (VAE) copolymer dispersions and dispersible polymer powders. Another contributing factor was our takeover of two companies that we’d previously set up with Air Products. Our twin-track strategy is extremely successful. Our customers see us as a unique and reliable partner because we are in an ongoing dialogue with them via our 15 technical competence centers, and develop joint solutions with them. That is the real strength of our business model.
So you don’t fear the competition?
Peter Summo: We don’t make it easy for our competitors. We have over 50 percent of the global market in dispersible polymer powders. In the case of dispersions, it is over 30 percent. We have built up our expertise in the formulation of products over many decades. That is something other companies will first have to acquire. We have every reason to believe that the volume of binders used in the roughly 20 application fields that we supply will rise. That is why we are investing so heavily in expanding our production capacities – so that we benefit from this growth. At the end of 2017, a new reactor was commissioned in Burghausen. In 2019, a dispersion reactor and a spray dryer will go on stream in South Korea.
It sounds as though there is still unlimited potential …
Peter Summo: If you consider that 80 percent of all construction sites in the world still lay tiles using the traditional thick-bed method, namely with sand, cement and a little water, then there’s still a lot of scope. Even if only 1 to 2 percent of the market each year changes to thin-bed technology, which requires polymers, that would be a huge volume for us.
Can you give us an example?
Peter Summo: In China, more and more people have a higher average income and can afford to buy high-quality products. In big cities there, entire ready-to-use bathroom pods for apartment blocks are delivered to the construction sector. That, too, is only possible with binders, since they make the adhesive flexible. Otherwise the tiles would fall off the walls on the way to the site. The same goes for India. Laying the expensive tiles that are used in Mumbai requires high-quality adhesives. This is precisely where our binders come into play.
But you altered WACKER POLYMERS’ strategic alignment. Where did you make adjustments?
Peter Summo: We have invested a lot in the markets in the last ten years – now it’s a matter of exploiting the opportunities to the maximum. In the future, we will make an even stronger distinction between our core business and new business fields. In our core business, we still have so much growth potential that we will be working to capacity for years to come. But in the medium and long term, it is important for us to establish new mainstays. That is why we now have teams that are fully focused on future business development. For example, with new technologies for road construction.
To what extent does sustainability shape your core business?
Peter Summo: Our products have low emissions and long life cycles and help to reduce CO2 – that is precisely what our customers want. Our technology is used wherever high-quality products are called for, for example in the renovation market in Europe or the USA. Even in times of crisis, this business grows at a higher rate than global GNP, thus ensuring that we weather the various economic cycles.
Your biggest sales hit, the VINNAPAS® brand, is already 80 years old. What innovations will drive your future success?
Peter Summo: Polymers have long been high-performance products containing an amazing amount of innovation. There are wall paints that repel dirt, sealing slurries for waterproofing bathrooms, and high-tech adhesives. Some of our core applications require products made from renewable raw materials, and we are working on carbon-neutral solutions to meet this customer demand.
How will WACKER POLYMERS’ world develop in the next ten years?
Peter Summo: Trends such as a growing world population, rising incomes, especially in Asia, and urbanization will be very good for our business. And then there’s the whole sustainability aspect, which is generating demand for our products. We managed to double our business in the last ten years. I’m convinced that we will repeat that in the next ten.