Just about everyone has heard the expression “black gold.” But what about “white oil?” Any clue what that is?
Actually, it’s mineral oil. And in addition to its familiar use as baby oil, this highly refined petroleum distillate – also known as liquid paraffin – is an essential ingredient in such diverse products as pharmaceuticals, veterinary medicine, food additives, cosmetics, and polystyrene.
Some of the largest oil and gas companies in the world manufacture this stuff.
So does Seojin Chemical Co., Ltd.
But Seojin Chemical is a bit different from the others. It is a relatively small company with well under 100 employees. Yet this South Korean manufacturer is a significant player in the white oil market and has big plans to expand its global footprint even further.
How does a company with such a modest sized workforce compete with giants?
In part, Seojin Chemical’s success and future aspirations are being fueled through automation – both at the company’s high-tech manufacturing facilities and in its business offices.
Competing with Giants
“Seojin Chemical develops its top-quality oil products through a series of discreet operations that can include vacuum distillation, deodorization, and dehydration,” explains In-Kyu Song, a Senior Consultant at the company.
Starting in 2009, Seojin Chemical has facilitated these sophisticated processes by introducing integrated systems that provide real-time monitoring and control of the various tanks and connection lines.
This automation helps cover manufacturing processes such as loading, blending, discharge, and overall logistics as the company’s products travel through the various production units and move onto packaging, storage, and shipping.
“As a result, Seojin Chemical now has an annual production capacity of 65,000 metric tons of white oil and another 30,000 metric tons of other specialty oils,” Song says.
Automating the Business Office
Automated operations play an important role in Seojin Chemical’s expanded business offices too. Working with BSG Partners, Seojin Chemical rolled out the SAP Business One application to support many of its financial and material resource planning processes.
“This has helped our company to improve its business process flow and promote enterprise-wide, paperless communications,” Song says.
Today, for example, Seojin Chemical can see bill-of-material ratio information in real-time and set appropriate inventory quantities by item and warehouse. This has helped reduce overall stock amounts and prevent the accumulation of unused stock.
In addition, the company has automated its accounts receivable process through real-time integration of logistics and accounting.
Establishing a System for Growth
Many industry analysts expect the global white oil market to see continued and steady growth. With increasing demand in applications such as adhesives, pharmaceuticals, textiles, and personal care products, some predict it will reach US$2.60 billion by 2024.
Seojin Chemical is already an important supplier of mineral oil to customers throughout Southeast Asia, China, and parts of the Middle East. And the company intends to continue its expansion in places like Europe, the Americas, and Russia.
“We have established a system to support the growth of Seojin Chemical by standardizing information and managing change,” says Song. “We have completed all preparations to enter the world market.”
In fact, the folks at Seojin Chemical could soon be calling mineral oil by a new name.
How does “white gold” sound?
Read more about how Seojin Chemical is increasing sales profits with SAP Business One in this SAP Business Transformation Study.