What are commoditized products?

“Commoditize” refers to a process in which a product is essentially deemed identical to the same class of offering presented by a rival company. Commoditized products allow consumers to make purchasing decisions based solely on the price-tags of the item in question.

Is ethylene a commodity?

In fact basic chemicals are chemical substances used as a starting material for the production of a wide variety of other chemicals; for this reason they are in general commodities, because they are highly demanded. Some examples of basic chemicals are: ethylene, benzene, chlorine and sulfuric acid.

What are bulk chemicals used for?

Bulk chemicals or commodity chemicals are used in healthcare, food processing, chemicals, fertilizer, construction, and automobiles industries among others.

Is hydrogen peroxide a commodity chemical?

These active ingredients are commonly-used commodity substances, such as ethanol and hydrogen peroxide.

What is commoditization example?

What is Commoditization? Consumers have access to millions of products with similar features. Think about flash drives, computers, tablets and fitness trackers. These products were a breakthrough years ago, but they lost their uniqueness and became a part of daily life.

What examples of commoditization do you see in your industry?

Take the example of keyboards, desktops, hard disks, earphones, power supplies, etc. These products are an example of commoditized products and are only differentiated based on their price.

Is chlorine a commodity?

Chlorine (a.k.a. Cl2) figures among the most important chemical commodities, being used in the manufacture of a myriad of day-to-day life products. It is an indispensable intermediate in the chemical industry, employed in the manufacture of a multitude of end products.

Is hydrochloric acid a commodity?

Hydrochloric acid is one of those chemical commodities that, without much attention, lubricate the American industrial economy day in and day out. The result is that HCl supplies depend largely on the health of other industries.

What is bulk in chemistry?

‘Bulk’ means the property of something that is great in magnitude and this is the same meaning which is used in the surface chemistry for solid-gas, solid-liquid, liquid-gas and liquid-liquid, as they ( solid or liquid or gas) are used in large amount (i.e in bulk) to study about these different phases.

Is petroleum bulk chemical?

1.3 Hybrid/batch. Most of the bulk chemical, petroleum, paper, and metals processes are continuous manufacturing in which raw materials are fed at one end, and products are produced continuously. Many specialty products are manufactured in small lots called batches.

Is paint a commodity?

Commodity chemicals are produced to supply diverse but usually well-defined industrial needs. Some major sectors and their components are: plastics, synthetic fibers, synthetic rubber. dyes, pigments, paints, coatings.

What are commoditized services?

Commoditization can be defined as the process by which a product or service that was unique or innovative becomes generic and widely available. As a result, its price drops as competition increases. When several companies offer similar goods, consumers tend to choose the lowest price tag.

Which is an example of a product that is commoditized?

However, other products like mobile phones, air conditioner, television, microwave, the refrigerator can only be commoditized in a certain price range. For example, a mobile phone whose cost is $250 has better features than a mobile phone costing $100. A similar difference can be seen in other products.

How is commoditization a challenge for a business?

Commoditization is the biggest challenge for those businesses whose products don’t have unique features. Such products become common as soon as they enter the market, and companies end up reducing the price of the product to the level where it can’t make much profit. However, there are a few techniques which can be opted to avoid commoditization.

When does a company start to commoditize a product?

Although it may sound counter-intuitive, the path to commoditization typically first begins when a company introduces a revolutionary new product or substantially improves an existing product. In either case, premium pricing is justified for the items in question.

How does a company compete to be commoditized?

Companies compete to sell commoditized goods by offering customers perks such as ancillary holiday-themed sales, free shipping, and extended warranties. Although it may sound counter-intuitive, the path to commoditization typically first begins when a company introduces a revolutionary new product or substantially improves an existing product.