BASF, the world’s largest chemical company, has a cleverly constructed supply chain where the byproducts of one operation get converted into starting materials of another operation. BASF, a company headquartered in Germany with 2017 revenues of $65 billion, calls this “Verbund.” In English this means to “combine” or to “cooperate.” I call it excellence in supply chain design. (View Highlight)
Verbund is defined as the intelligent interlinking of production plants, energy flows and infrastructure. BASF has six Verbund sites that create efficient value chains that extend from basic chemicals basic chemicals to high-value-added products such as coatings and crop protection agents. When by-products of one plant can be used as the starting materials for another, chemical processes consume less energy, produce higher product yields and conserve resources. (View Highlight)
Verbund saves the company money. The company believes they save over one billion euros annually through this concept.
But Verbund is also a sustainability play. BASF saves on raw materials and energy, lowers emissions and cuts logistics costs because the synergistic production operations are near each other. In logistics, having plants near each other allows for 280,000 fewer truckloads per year.
In energy, waste heat from production processes is captured to be used as energy in other production plants. (View Highlight)
