COX CHEMICAL, INC.

CASE

B2B MARKETING
SUBMITTED BY-
NACHIKET KULKARNI
AKSHAY GHONGE
PUNEET SAHU
DEB ARGHA B ANERGEE
SHASHANK JHA
 ABOUT COX CHEMICAL, INC.

• Produces commodity chemicals, chemical intermediaries and specialities

• 95% of 700 odd products sold to industrial markets in both US & abroad
• Sales over $1.2 billion in 2014 with net PAT over $60 million
• Serves customers such as petroleum companies, food processors, pulp & paper
manufacturers, textile companies and steel mills
• Has long lasting relationship with Puritan Chemicals
• Between 2010 & 2014, Cox made purchases from Puritan totalling $8.95 million,
whereas Puritan made purchases of around $12.4 million from Cox during the
same period
 PROBLEM STATEMENT

• Cox Chemical, Inc. has to make a business decision of which supplier to

choose between the existing supplier Puritan Chemicals and the competitor
Lee Chemicals in order to procure muriatic acid
• They have to make this decision on the basis of what implications the choice
of supplier will have on their business
 SUPPLIER EVALUATION
PURITAN CHEMICALS
1. Price=$97.5 per ton
2. Delivery channel-Tank truck
3. Extra cost incurred for delivery channel = $0
4. Total cost of procurement = $97.5 per ton
5. Terms and conditions- Single supplier for the
entire-requirement basis
6. If this condition is fulfilled, Puritan will
increase dollar volume purchases from Cox
by $500,000 by buying other chemicals which
they used to buy from other suppliers
7. Top rated player in terms of quality
8. Assured timely delivery
LEE CHEMICAL COMPANY
1. Price= $97.5 per ton
2. Delivery channel-Tank car
3. Extra cost incurred for delivery channel = $5
4. Total cost of procurement = $102.5 per ton
5. Terms and conditions- supplier capacity is
3500 tons only
6. No advantages if this condition is fulfilled
7. No clarity in terms of quality as the source of
making the chemicals was not known
8. No guarantee in terms of timely delivery as
this was the first time Lee chemical company
will be supplying muriatic acid
 RECOMMENDATIONS

• Based on the below reasons, we recommend Cox Chemical to continue

buying Muriatic Acid from Puritan Chemicals:
• The maximum quantity that Lee could offer was 3500 tons which was less
than the requirement of the Tulsa plant. Also there was no addition to the
revenue of Cox unlike in the case of Puritan which would add $500,000 if
their condition of single supplier for entire basis is fulfilled
• If they choose Lee chemical company, Cox would surely need another supplier
for muriatic acid and at the same time they will not fulfil the terms and
conditions of Puritan which could result in loss of contract and can damage
their long term relationship