PracticeConsultingThe Financial Week Ahead – Ellis in online drive.

The Financial Week Ahead - Ellis in online drive.

Chemical distribution giant Ellis & Everard, due to unveil full-year results next week, is to close nearly half of its UK warehouses as part of its e-commerce strategy.

Financial director and chartered accountant John Samuel said this week that the group – the world’s fourth largest chemicals distributor – plans to bring 50% of its customers online over the next year.

Samuel and chief executive Peter Scott, also a qualified chartered accountant, will expand on the group’s online vision as he unveils the results next Tuesday.

Ellis last month joined two business-to-business electronic markets set-up by Solvay SA, AllianceChem.com and ChemSingleSource.com, with computer systems provided by International Business Machines Corp.

Ellis will join the exchange with three other competitor distributors – Stinnes AG’s Brenntag, Germany’s Penta and Biesterfield.

Alliance.com is predicted to carry EUR2.4bn (#1.5bn) of small to medium-sized orders from industrial clients across Europe.

ChemeSingleSource.com is aiming to handle a EUR1.5bn (#940m) slice of the European market supplying the single source buyers for medium and large European companies.

Samuel says that Ellis has responded to the online challenge by pumping #1m into the updating of its IT capability, which is likely to reach #4m over the next two years.

‘Our ERP system and business-to-business online capability will mean that we don’t need so many distribution points to reach the same amount of geographical range as our supply chain management becomes more efficient,’ said Samuel.

Ironside Technologies is developing the Ellis site, which will be up and running in the autumn. Samuel moved to Ellis in 1989 from Whessoe where he was group financial director and trained at Price Waterhouse in Birmingham. The company’s head office is based in Bradford.

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