Castrol Industrial Shakes Up Sales Channels


Castrol Industrial North America Inc. said recently that it plans to realign its distribution channels as part of a plan to bring greater clarity to its business and to focus on its strengths. In doing so, the lubricant supplier said it will reduce the number of distributors it uses and the number of industries served by direct sales.

Castrol Industrial North America is based in Naperville, Ill., and is part of British energy giant BP. It is one of the largest industrial lubricant suppliers in the United States and claims to be the largest supplier of metalworking fluids.

Officials said the companys distribution channels are ripe for a shake-up due to the way the business has evolved over the past 15 years. The company acquired approximately 10 companies during that period and tended to maintain the channels it inherited. In some cases, officials said, a customer that purchases from a distributor might be better off buying directly from Castrol. In others, it makes more sense for a direct customer to buy through a distributor.

Marketing Manager Vasu Kulkarni said Castrol Industrial North America is asking customers which method they prefer, but some outcomes will be determined by the industry in which a customer operates. The company identified three industries on which it plans to focus: automotive, aerospace, and metals and machinery manufacturing. In addition, it said it will continue expanding in the mining, cement and engineered wood industries. On the other hand, the company plans to reduce its emphasis in industries such as plastics manufacturing.

Everybody has their own strengths and weaknesses, Kulkarni told Lube Report. Were selecting those industries where we have a core competency and saying that is where we want to place our focus. In areas where we dont have as much of a core competency, we will let someone else serve that industry instead of deluding people.

At the same time, Castrol has identified a smaller network of distributors through which it plans to work in the future. Kulkarni said the realignment will take place during the first two quarters of this year.

Castrol said it will retain direct control of its chemical management services offering, Complete CMS.

Related Topics

Market Topics