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Dec 5, 2012 (4 years and 11 months ago)

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Running head: DOW CHEMICAL ANALYSIS








Dow Chemical Company Analysis

Allison Garske

Young Lee

Arika Bourbina

Jeffrey Neymeiyer

Robin Merrow
-
Williams

Saginaw Valley State University



DOW CHEMICAL ANALYSIS


History and Background

The Dow Chemical Company was founded in 1897 based on the plan from Herbert Dow
to
manufacture bleach on a commercial level. In 1898, the first commercial scale production of
bleach began, and the ‘Dow
-
in
-
diamond


logo was created to help resolve product shipping
problems

(History, 2011)
. In the early 1900’s, Midland Chemical Company mer
ged with Dow to
become Dow Chemical. They produced their first product for fruits and flowers, giving rise to
the company’s agricultural chemicals division, as well as a sodium benzoate as food
preservative. The agricultural chemicals division was establis
hed b
ased on a spray for fruit trees
(History, 2011).


In 1913, Herbert Dow announces that the company will exit the bleach business and
focus more on the value of chlorine as a raw material

(History, 2011)
. Dow stock rose
dramatically. In 1922, they devel
oped a record number of products, such as ethylene dibromide
for use in ethyl gasoline. By 1944, Dow employed 12,300 people nationwide, and by 1949 their
sales surpassed $200 million. In 1950 their employee count reached 19,500 and they expanded to
open Do
w Chemical International and shortly after they introduced Saran Wrap®

(History,
2011)
.

Products

Their goals as a company are geared towards innovation, renewable and sustainable
technology, and human interest.

To date, Dow had annual sales of $53.7 billi
on and employed
approximately 50,000 people worldwide

(Products
, 2011)
. The Company’s more than 5,000
products are manufactured at 188 sites in 35 countries across the globe

(Products, 2011)
.


Competitors of the company include El DuPont de Nemours & Co.,
Bayer AG, Total SA,
Formosa Plastics Corporation, Shell Chemicals Limited, BASF SE, and Mistubishi Chemical
Corporation

(Products, 2011)
.

DOW CHEMICAL ANALYSIS



Dow’s product market is vast and ever
-
expanding. They have many departments, which
include: Agriculture and Food; Bui
lding & Construction; Electronics and Entertainment;
Healthcare and Medical; Household Goods and Personal Care; Industrial; Oil and Gas;
Packaging, Paper, and Publishing; Plastics; Transportation; Utilities; and Water and Process
Solutions

(Products, 2011)
.


The agriculture product line is subdivided into six different areas: crop protection,
ingredients for formulations, micro
-
irrigation systems, plant genetics and biotechnology, urban
pest management, and water treatment systems

(Products, 2011)
.


The building and construction product line is subdivided into 30 categories, some of
which include: caulks and sealants, housewraps, molding, roofing, siding, water systems, PVC
piping and plastics, wire and cable, floor care materials, and insulation mate
rials

(Products,
2011)
.


The electronics and entertainment department is subdivided into 19 categories, some of
which include: coatings and adhesives, hoses and tubes, plastics and film, semiconductor
processing and manufacturing, solar cell manufacturing,

metal working, and medical equipment

(Products, 2011)
.


The healthcare and medical product line is subdivided into 18 categories and includes:
excipients, optics, wipes, water treatment, health and hygiene, adult incontinence, process
chemicals, pharmaceu
tical processing, diapers, and feminine products

(Products, 2011)
.


The product line that is receiving the most attention because of the economic crisis is its
oil and gas line. They have been working on custom chemistries, technologies, and researching
an
d developing capabilities to improve the efficiency, speed, capacity, and environmental
sustainability of downstream processes and the performance of products

(Products, 2011)
.

DOW CHEMICAL ANALYSIS



Their plastic line is one of the oldest product lines at Dow
-

as it has been p
roducing them
since the 1950’s. It includes materials such as polyethylene, polypropylene, and elastomers

(Products, 2011)
.


Dow’s up and coming product lines that are the results of innovation and competition
mainly include their dive into the solar indu
stry. They were recently noted on CBS Evening
News as a “company that in the aftermath of the global economic crisis has taken matters into its
own hands to create new jobs in new sectors, retrain displaced workers and put them back to
work” (
Baldwin, 2011
). Their new DOW™ POWERHOUSE™ Solar Shingle facility is the sit
e
of the solar panel production

and is actively hiring local graduates from Delta’s Fast Start Solar
training program.

The product

that is made in the new facility
, solar
shingles,

are compact
sized
solar panels that sit conveniently on top of homeowners roof tops. They are not bulky or
unattractive
; instead, they integrate into rooftops with ease because of their sophisticated design.
The Solar Shingles capture sunlight, creating clean electric
ity to lower homeowner energy bills.
A worry of customers includes not having enough sunlight during certain periods of time to fuel
their energy needs. Dow says the need not worry, “Germany, which has comparable yearly
sunlight to states in the Midwest an
d Northeast, is the number one solar energy producer in the
world. And to prove there is enough sunlight just about anywhere in the U.S., Dow has partnered
for a second time with a local Michigan home builder to construct a new net
-
zero energy
demonstratio
n home” (Powerhouse, 2011).
The product is not yet available to the public, but it is
expected to hit the market at the end of Q4 in 2011.

Mergers and
Acquisitions

Since 1983, the company has invested many resources
obtaining and purchasing
in their
merge
rs and acquisitions (M&A). In the 28 year period, they have made 115 acquisitions while
DOW CHEMICAL ANALYSIS


taking stakes in 61 companies. They have also performed 193 divestitures during this period.

Their latest merger was completed in April 2009 with a company called
Rohm
and Haas
,
forming Dow Water & Process Solutions (Leinberger, 2009).

This new merger will

provide

innovative water and process solutions to
both communities and industries.
Dow Water &

Process Solutions offers a broad portfolio of ion exchange resins, reverse osmosis membranes,
ultrafiltration membranes and electrodeionization products, with strong positions in a number of
major application areas, including industrial and municipal wate
r, industrial processes,
pharmaceuticals, power, residential water and waste and water reuse

(Leinberger, 2009).