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Exporting chemicals to Europe, tolling is a valid option

In the world of common day a lot of large and small international companies choose deliberately for toll manufacturing of their chemicals when they expand their business to Europe. Toll manufacturing is also known as tolling, contract manufacturing or blending/mixing services. There are many well known advantages such as ability to focus on the core business, no need for investments, flexibility of production costs, reducing regulations compliancy et al.

For these reasons tolling is in many situations the preferred solution even if you have a proprietary product (intellectual property considerations) because in tolling non disclosure confidentiality agreements are standard practice, assuring you that your formulation stays your formulation.

Exporting your chemicals to Europe

The market

The EU is a strong economic and political union of 28 member states and over 500 million people. The EU has built a single market, developed common policies, liberalized inter-country travel and launched a common currency shared by 19 countries. The EU is the world’s most integrated market.

REACH legislation

If you are planning to export to Europe, you have probably heard about REACH. REACH, (Regulation EC 1907/2006 on the Registration, Evaluation, Authorization and Restriction of Chemicals), is the EU regulation on chemicals and their safe use. REACH makes industry responsible for managing risks that chemicals may pose to health and the environment, and for providing relevant information to users along the supply chain. The REACH system is managed and controlled by the European Chemicals Agency (ECHA), which manages the registration, evaluation, authorization and restriction processes that apply to chemical substances throughout the EU.

REACH affects virtually every industry from automotive, aerospace, plastics and cosmetics to aluminum, household cleaners, computers and textiles. REACH applies to all categories of chemical substances manufactured, imported or used in the EU, with only a few limited exemptions (for example food). REACH also applies to chemicals contained in preparations and in finished products (so called articles).

Classification and labelling requirements

REACH requires that EU manufacturers and importers classify and label all substances subject to registration and authorization, and submit this information to the EU Classifaiction and Labelling Inventory, a database managed by the European Chemicals Agency. Classification and labeling rules are governed by the CLP regulation on the classification, labeling and packaging of substances and mixtures. For more information, see the CLP pages of the European Chemicals Agency’s website.

Choose tolling when entering the EU market

When you choose for toll manufacturing of your chemicals at a local tolling company in Europe you are able to reduce your regulations compliancy risks (REACH, ISO 9001, ISO 14001,  et al.). In many cases a specialty toll blender is already compliant with current regulations such as safe labelling, transport and hazard regulations. This is of course even more important when dealing with hazardous (and non-hazardous) products as chemicals.

Next to the regulation compliancy risks it is many times also financially very attractive to produce your chemicals locally, in close proximity to your customers, in stead of shipping “water” overseas.

Key factors to choose for tolling

But what are the key factors one should consider when starting a toll manufacturing agreement with a tolling company:

  • Strong EH&S track record: A strong environmental, health, safety and security (EHS&S) track record and history of regulatory compliance. Many factors have to be taken into account for this such as certifications (SEVESO regulations, ISO 9001, ISO 14001). For the EU market REACH compliancy and an extensive track record of handling REACH matters is of utmost importance.
  • Product Quality: extensive and broad knowledge about chemistry, preferably a toll blender has its own laboratory with a wide range of equipment. A tolling company should be able to meet the quality standards you desire.
  • Responsiveness to requests for information; a toller should act swiftly and promptly
  • Reliability of supply
  • Security: make sure you choose for a tolling company that has a track record of working confidentially
  • Financial stability. This is especially very important when dealing with long term supply agreements

Always remember, a tolling partnership can be a wise business decision but companies most really have to think thorough what their expectations are and choose a contract manufacturer they can work with to meet manufacturing needs, both today and tomorrow.

 

AD Productions B.V.

Interested in to know more about how toll manufacturing could improve your bottom line? AD Productions, based in the Netherlands, is a strategically located toll services company close to the port of Rotterdam and Antwerp. Contact AD Productions today via contact, by phone at +31 (0) 167 526 900  or visit our toll blending services page.

3 FAQ about Toll Manufacturing

Toll manufacturing/blending also known as contract manufacturing or contract blending is a service whereby the production of (complex) chemical products is outsourced to a third party company (blender). Nowadays it is a common service for chemical companies, from global conglomerates through to regional and specialized suppliers to reduce production risks. You supply the formula and the toll blender scales up your formula, blends it to your specifications and then packages the product and delivers it to your or (when specified) directly to your customer.

FAQ 1: Does the toll manufacturer provide the ingredients/raw materials to blend or do I?

This dependents on your own specific needs. Some companies wish to outsource the complete process of producing chemicals, including purchasing of ingredients/raw materials, others choose to provide the ingredients themselves. A good toll manufacturer adopts its way of working to your business needs.

FAQ 2: Will my formula be safe when choosing for toll blending services?

No doubt about it. A toll manufacturer should welcome NDA’s (Non-Disclosure Agreement) with business partners to ensure absolute confidentiality.

FAQ 3: How about regulations compliancy?

Toll manufacturers that produce for the top 50 chemical companies are often already compliant with current regulations, meaning that you are able to reduce your regulations compliancy risks (ISO 9001, ISO 14001, REACH et al.).

AD Productions

AD Productions offers toll manufacturing & blending services to help you formulate, blend, package, and/or private label your powder/liquid chemical products. We have some of the most advanced chemical blending equipment at our ISO 9001 and ISO 14001 certified plant and can produce compliant with REACH and Seveso III regulations. Therefore we are one of the most up-to-date toll blending companies in the EU.

For more information contact AD or visit or toll blending services page.

 

Improve your bottom line with Toll Manufacturing

Every company wants to improve their bottom line and share holder value. Outsourcing is a hot topic nowadays to achieve this goal. Main reasons to start outsourcing are focus on the core business, hiring expertise and operating more cost efficiently. This can be perfectly achieved when choosing for toll manufacturing/ custom manufacturing.  In this article you read how.

You could start early in the product lifecycle with involving a toll manufacturer. A skilled toll manufacturer is capable to take a project from piloting phase and scale-up to full production level.

5 reasons why companies choose for toll manufacturing:

• “We have a knowledge gap in expertise necessary to scale-up productions”
• “We do not have the specialized equipment required and do not wat to invest in it”
• “We want a short time to market”
• “We do not have enough production capacity or storage”
• “We know meeting regulatory requirements is hard and costly for this product”

Continue reading to discover how it can profit your bottom line.

Next to the cost efficiency argument, there are a lot of other advantages to start toll manufacturing. For example; at this moment you ship your chemical products overseas, a costly thing, probably producing locally at a toller is more cost efficient.  Other example; the demand for your product is decreasing, this makes it less efficient to dedicate your own production plant to it, but you still have an acceptable demand for the product. This is mostly the last phase in the product lifecycle. Instead of making the decision to stop or continue with inefficient production levels at your own production plant, toll manufacturing could be your solution to improve the bottom line. In the start up phase of a new product the same reasoning could apply, when volumes are still relatively low it could be interesting to use a toll manufacturer, in the mid section of the product lifecycle when volumes increase you could do it at your own plant.
Other advantages is that because of the experience a toller is able to produce at a much higher quality and consistency.

 

Market for Toll Manufacturing

The market for toll manufacturing continues to grow, key segments with growth are the fine and specialty chemical industry.  Market research of AD International indicates that a short time to market, financial advantages (less capital costs and more efficient production) and focus on the core business are top drivers for outsourcing to a contract manufacturer.

To summarize, toll & custom manufacturing and repackaging services can provide your company with the opportunity to decrease costs, increase profits and offer better products to your customers to improve long-term business relationships. Using it strategically in your product lifecycle it can definitely improve your bottom line.

One last side note to mention. When considering  toll manufacturing, it is important to see it as a partnership. The toll manufacturer should offer you confidentiality, reliability, regulatory expertise and timely production deliverables. Signing a non-disclosure-agreement (NDA) is common practice.

 

AD Productions B.V.

Interested in to know more about how toll manufacturing could improve your bottom line? AD Productions, based in the Netherlands, is a strategically located toll services company close to the port of Rotterdam and Antwerp. Contact AD Productions today via contact , by phone at +31 (0) 167 526 900  or visit our tolling and blending services page.