The polyolefins industry, like so many others, is evolving significantly. Growth in emerging markets and Asia has skyrocketed while European and North American markets have matured.
Last week I was invited to speak at the Future of Polyolefins Conference 2014 in Dusseldorf, Germany, where top executives from key industry players such as Borealis AG and Clariant gathered to discuss industry dynamics and trends.
A resounding theme throughout the conference was the seismic shifts in demand and production the polyolefin industry. In the near future Europe will move from a net exporter to a net importer as it closes several polyolefins facilities and reduces capacity.
If regulations change, the U.S. will export more polyolefins to fill part of this gap in production. China is also ramping up its polyolefins production to match growing demand in Asia, but even with additional capacity demand will soon outstrip production over the next ten years.
Several speakers also stressed the need for diversification in order to smooth over volatility in the industry.
In this new paradigm leaders are reassessing their growth strategies and are considering external moves like strategic alliances, joint ventures and acquisitions.
In my presentation, “Strategic Alliances, Joint Ventures and M&A – the Route to Success,?” I encouraged conference attendees to consider their five options in building their growth strategy:
- Grow Organically
- Exit the Market
- Be the Low-Cost Provider
- Do Nothing
- Pursue External Growth
It’s important to realize you have a choice when it comes to planning your growth strategy. By evaluating all five options, you are better equipped to make the right decision and confidently execute your plan.