As someone who procures and/or ships chemical products, you've probably realized that the pre-COVID global supply chain may never return.
Nearly three years into this global pandemic, persistent labor and supply chain shortages continue to cause logistical disruptions both nationally and globally.
This means you need to forecast further ahead and get creative to ensure your products remain at the quality levels your customers expect and arrive on time.
It also means you may want to consider changing up your buying habits and purchasing chemicals in bulk.
However, buying chemicals in bulk quantities may not be right for your organization. Here's what you need to consider before buying chemicals in bulk.
Why Should You Buy Bulk Chemicals?
Long-Term Cost Savings
The clearest benefit of buying in bulk is long-term cost savings. Having more product shipped less often will allow you to keep your freight costs down, as long as you ship in these larger quantities directly to – or as close as possible to – the facilities where your products are made.
As force majeures, sales-controlled product allocations, and staffing shortages continue to impact the chemical industry's supply chain, it's a good idea to have more product on hand than you need right now.
Raw material shortages are now commonplace. And when they happen, the first people to not get their shipments are those who don't have their volumes secured. Often, this impacts people who are ordering chemicals infrequently or irregularly.
Buying in bulk will ensure you have the crucial chemical products you need on hand when you need them. This, in turn, will translate into more efficient and cost-effective scheduling and shipment options.
If your product expiration dates and cashflow allow for it, buying in bulk and storing more product on-site will make your operations more nimble – and save you costs down the road.
If your organization is looking to reduce its carbon footprint, buying in bulk is the right choice. Fewer shipments ultimately produce fewer greenhouse gas emissions. Additionally, bulk packaging like super sacks produces less packaging waste compared to non-bulk options like drums or boxes.
Why Shouldn't You Buy Bulk Chemicals?
Immediate Cashflow Impacts
Bulk buying restricts cashflow in the short term. Shipping in greater volumes will cost you more upfront, as will any facility investments (like storage tanks or warehouse modifications) you need to make to accommodate these higher volumes of product.
Once you decide to buy in bulk, you're going to need to invest in storage options – if that's even possible. Your facility may not have the space, making purchasing bulk chemical products infeasible.
More Involved Planning
If shipments are coming in only once per month as opposed to daily or weekly, you're going to need to take more time to resource plan further in advance. And more complex capacity planning may translate to higher labor costs, training costs, and employee bandwidth restrictions, especially if your team isn't accustomed to it or is learning new processes altogether.
What's Meant by "Bulk" and What Packaging Options Are Available?
By definition, shipping liquid in volumes over 119 gallons (or 450 liters) is considered bulk. When it comes to solids, anything over 882 pounds (or 400 kilograms) is considered bulk. Alternately, solids with volumes over 119 gallons are also considered bulk.
The packaging options that can accommodate these volumes of bulk chemicals include:
- Bulk rail cars (hold between 13,000 and 33,000 U.S. gallons)
- Bulk tank trucks (hold between 3,000 and 11,600 U.S. gallons)
- Super sacks (hold between 1,100 and 3,300 pounds)
- Totes (hold either 275 gallons or 330 gallons)
Are You Considering Buying Chemicals in Bulk Quantities?
Even if you think budgetary restrictions and storage space may prohibit bulk chemical shipments from being a reality for your organization, it's often worth discussing your options with experts who can guide you to a solution based on your specific needs.
It's worth reiterating that cost savings over time can be substantial if you buy chemicals in bulk. And buying your chemicals in bulk may provide you the flexibility you need to navigate today's supply chain challenges.
At Royal Chemical, we have over 80 years of experience finding packaging solutions that work exactly for our customers' needs – including bulk packaging solutions.
Reach out and talk to one of our experts to discuss whether you should consider bulk- buying chemicals.