BASF Asserts Commitments to Company and Industry

Hans Reiners, president of the agricultural products division at BASF, welcomed members of the trade media to the Research Triangle Park, N.C., on April 11 for a presentation and tour of the chemical company’s facility. During the event, Reiners affirmed the company’s commitment to the chemical industry in the strongest language possible. “Let’s face it, we’re a chemical company,” he said. “If nobody stands up for it…we shouldn’t be surprised that, step-by-step, people will say we don’t need chemicals anymore. We (BASF) want to fight for a sustainable future for chemicals.”
 
INDUSTRY & BUSINESS COMMITMENTS. Known for its slogan, “We don’t make a lot of the products you buy; We make a lot of the products you buy, better,” BASF has further expressed its commitment to the industries it serves by updating its brand. The company’s corporate logo and tagline now read, “BASF: The Chemical Company.”

The branding strategy is part of a new corporate effort known as “BASF 2015,” which asks all BASF associates to incorporate four strategic guidelines into their day-to-day work. These guidelines include:

• Helping customers to be more successful
• Earning a premium on the cost of capital
• Forming the best team in the industry
• Ensuring sustainable development

“Our ambitious BASF 2015 program will guarantee that we will remain the world leader in the chemical industry,” Reiners said. “This strategy also ensures that, just as we have in the past, BASF will continue to be a leader in shaping the future.”

Regarding the business direction of BASF, group vice president of North America, Bill Wisdom said the company will continue to focus on core competencies, deliver competitive products, set reasonable expectations, align business structure and manage costs. This adds to the success of BASF while helping its customers be more successful, according to Wisdom.

Wisdom also discussed BASF’s business base ratio. An optimal technology model would have a 50/50 split between new and established technology. Any variation should lean heavier in favor of more new technology over an established base. In 2002, according to Wisdom, BASF was at a 31/69 percent (new) split, but has worked toward a 49/51 split in 2005.

RESEARCH & DEVELOPMENT. To protect and expand its market position, Reiners said BASF continues to invest a significant portion of its people and financial resources in research and development. “In order to sustain our role as a leading innovator, we are continuing significant research and development efforts,” he said.

In 2004, BASF invested $339 million in R&D, a $42 million increase from the previous year. Moreover, the company “is creating innovations literally on a daily basis,” he added, nothing that BASF applies for 1,000 patent applications annually. “Based on new and exciting opportunities we see in our business, we plan to further increase our investment in this year and the years ahead,” he said. In 2007, the company plans to invest approximately 9 percent of its sales in R&D.

Reiners said he is bullish about the company’s future because BASF has a “young portfolio with a high proportion of patent-protected products” as well as a “strong late-stage R&D pipeline” that should allow the company to continue to add value to its customer relationships. “To us, innovation is the most important factor in achieving success,” he said. “In order for us to be able to convince customers to buy a new … product, it must be significantly better than existing solutions. This applies to its biological effects and its reliability, to its economic benefits and – last but not least – to its safety regarding humans, animals and the environment. Combining these efforts is creating additional value – for our customers and for BASF.”

Among the chemistries reaping the benefits of BASF’s research and development are products in the insecticide and fungicide markets. “Taking the leadership role in innovation and keeping it in the future, takes more than our obvious dedication and passion,” he says. “It demands investment as well.”

Reiners says he sees the insecticide and fungicide markets growing by 2 and 3 percent each year and expects to grow above the market.

 “About one third of our 2004 sales come from new products – new actives or new and improved formulations – launched over the last three years,” he adds. “At the same time, the percentage share of patented actives in our sales steadily increased. It is now more than 50 percent, clearly ahead of comparable numbers of our competitors. Both figures prove the results of our innovation strategy.”

Following Reiners on the program was Bill Wisdom, group vice president, North America, Agricultural Products, who said BASF has “put a lot of time and effort in trying to understand the customer” in recent years.

Like Reiners, Wisdom said the company is well positioned for growth because of its rich product pipeline. “We have a very good balanced portfolio now,” he said. “I feel very good about where BASF is positioned in the marketplace.”

PCT magazine and Golf Course News magazine contributed to this article.