fmc

Businessmodel of FMC

Customer Segments

FMC develops and markets a broad range of products that are utilised by commercial entities across multiple business sectors. The Company’s main target markets include:

  • Agriculture, including commercial crop producers, growers, and farming businesses;
  • Food Production, including producers of various food products, such as confectioners, grocery producers, beverage producers, and meat and seafood companies;
  • Pharmaceutical and Personal Care, including pharmaceutical companies, health supplement producers, and cosmetic and personal care item manufacturers;
  • Household Care, including producers of various household care items, such as laundry tablets and detergent;
  • Energy Storage, including sustainable energy, transport, and electronics companies;
  • Industrial Chemicals, including manufacturers of various industrial chemicals, greases, and lubricants; and
  • Construction, including commercial property developers, contracting firms, and construction companies. FMC serves a global customer base, with operations across North America, Latin America, Asia Pacific, and Europe, Middle East and Africa. FMC does not name its customers on its website or in its annual report.

Value Propositions

FMC provides value to its customers in the following ways:

  • Its industry standing and reputation, with the Company established as one of the leading companies in its field, with a track record for delivering high-quality products and reliable solutions;
  • Its international reach, with the Company serving a global client base, which spans North America, Latin America, Asia Pacific, and Europe, Middle East, and Africa;
  • Its broad portfolio of products, with the Company producing and marketing a wide range of products – including insecticides, herbicides, natural colourants, and specialty lithium products – which are utilised across a broad spectrum of target industries;
  • Its technology-backed processes, with the Company committed to to developing process technology improvements and innovative application solutions to drive the highest value for its customers; and
  • Its network of production facilities, with the Company operating an international network of production facilities across all of its geographic operating regions, enabling it to provide products quickly and efficiently. ### Channels

FMC operates a website at www.fmc.com, through which it provides information on its general activities and product range. The Company also operates websites dedicated to its health and nutrition and lithium operations at www.fmcbiopolymer.com and www.fmclithium.com respectively. FMC does not operate an online sales channel, nor does it appear to provide an online customer portal.

FMC principally markets and sells its products through its own direct sales force, which its organised by operating segment and geographic region. The Company’s direct sales personnel operate primarily out of the Company’s network of international offices across the Americas, Asia Pacific, Europe, Africa, and the Middle East, including in Charlotte, North Carolina; Bangalore, India; Shanghai, China; Tokyo, Japan; Taipei, Taiwan; and Bromborough, UK.

FMC accesses certain markets across Latin America and Asia through local independent distributors and marketing alliances. The Company also utilises the services of several major national and regional distributors across North America. Much of FMC’s sales in Europe are made through Cheminova, which the Company acquired in 2015.

FMC operates its own manufacturing and distribution infrastructure across each of its operation regions. This includes a network of production facilities and distribution centres.

Customer Relationships

FMC does not offer products and services to its customers on a self-service basis. Instead the Company provides tailored services to customers. It direct sales personnel consult closely with clients in order to establish their individual needs, and the unique terms of each sales and distribution contract. The Company seeks to establish longstanding relationship with its customers, with many of its contracts spanning multiple years.

FMC provides ongoing support to its customers, with many of its larger clients having dedicated account management teams that are available to address concerns and client needs. Customers are also able to contact members of the Company’s support and relations teams over the phone, via email, and through an online contact form, in order to receive personalised responses to queries and enquiries.

FMC additionally provides a range of online resources to its clients. This includes information on its various products, tax information, safety and security reporting, and information regarding suppliers. Customers are also able to follow the operations of FMC, and interact directly with the Company, through its social media accounts, including with Facebook, Twitter, LinkedIn, Google+, and YouTube.

Key Activities

FMC is a diversified chemical company. It manufactures, markets and sells a wide range of products for use across multiple industries, including the agricultural, consumer and industrial markets.

The Company aligns its operations into three reportable business segments: FMC Agricultural Solutions, which develops, markets and sells insecticides, herbicides and fungicides; FMC Health and Nutrition, which develops and sells nutritional ingredients, health excipients and functional health ingredients, including microcrystalline cellulose, carrageenan, alginates, natural colorants, pectin and omega-3; and FMC Lithium, which manufactures lithium for use in a range of lithium products, which are used in energy storage, specialty polymers and chemical synthesis application. FMC serves a global client base, with operations across the Americas, Europe, Asia Pacific, the Middle East, and Africa.

Key Partners

  • Supplier and Vendor Partners, comprising suppliers of materials, equipment, and tools – notably types of seaweed, specialty pulps, natural colourant raw materials, and fish oils – that are used in the Company’s manufacturing processes, as well as suppliers of services and technologies that are utilised more broadly across the enterprise;
  • Channel and Distribution Partners, including local, national and regional distributors, and independent sales agents, which support and supplement the capabilities of the Company’s in-house sales and marketing force;
  • Joint Venture Partners, including various chemicals and manufacturing companies, with which the Company jointly develops and markets products through mutually owned entities;
  • Community and Social Partners, comprising various non-profits and charitable organisations with which the Company collaborates on social and community projects around the world; and
  • Strategic and Alliance Partners, comprising market-leading companies across multiple industries, with which the Company shares resources and works on joint projects. ### Key Resources

FMC’s key resources are its intellectual properties and technologies, its materials and supply chain, its network of production facilities, its IT and communication infrastructure, its sales and distribution channels, its partnerships, and its personnel.

FMC owns a number of US and foreign patents, trademarks and licenses that are cumulatively important to the Company’s business. Searches of records published by the US Patent and Trademark Office identified a number of patent applications filed in FMC’s name, including applications entitled ‘Liquid-fertilizer ready formulations of bifenthrin’, ‘Insecticidal compositions and method for insect control’ and ‘Self-gelling alginate systems and uses thereof’.

FMC also owns and or leases a number of physical properties around the world that are key to its operations. This notably includes its network of 32 facilities spread across its three operating segments and various operating regions.

Cost Structure

FMC incurs costs in relation to the development of its technologies and solutions, the procurement of supplies, the operation of its production facilities, the maintenance of its IT and communications infrastructure, the operation of its sales and distribution channels, the management of its partnerships, and the retention of its personnel.

In 2015 FMC recorded total cost of sales and services in the amount of $2.20 billion, selling, general and administrative expenses totalling $737.90 million, and research and development costs of $143.7 million.

Revenue Streams

FMC generates revenue through the production, marketing, and sale of various chemicals and related products. The Company organises its products by operating segment:

  • FMC Agricultural Solutions, which derives revenue from the sale of insecticides, pesticides, and herbicides;
  • FMC Health and Nutrition, which derives revenue from the sales of carrageenan, alginates, natural colourants, and Omega-3; and
  • FMC Lithium, which derives revenue from the sale of lithium. In 2015 FMC generated annual revenue of $3.28 billion, up marginally on the $3.26 billion recorded by the Company in 2014. The vast majority of the Company’s revenue was derived from its FMC Agricultural Solutions segment, which alone generated $2.25 billion for the year.
Written on October 25, 2017