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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.

 

Chemicals outsourcing: what are my options?

When deciding to outsource your chemicals it is crucial to choose the outsourcing method that best suits your company needs.

 

The most frequent varieties of chemical outsourcing are:

  • Licensed manufacturer – chemical products manufactured under a long-term licence. The manufacturer buys raw materials on own account and bears risks of selling finished products.
  • Contract manufacturer – manufacturer acts as agent, producing chemical (end or sub) products for the principal who guarantees to buy outputs. The agent bears risks of buying and stocking raw materials/components.
  • Toll Manufacturer – Principal buys the raw materials/components although these usually pass direct to the agent. Buying and selling risks lie with the principal.The advantage of outsourcing is that chemical enterprises can focus their efforts and time on research and development, new markets, and building key relationships with customers while the outsource partner can completely focus on improving the production methods and processes.

Want to discuss if outsourcing could be interesting for your business? Contact AD Productions today!