With the growing trend towards sustainability and natural products, Aaron Lee, Global Vice President of Home Care and Industrial Cleaning for Univar Solutions, discusses the different segments of their business, highlighting the shift towards innovation in the post-pandemic world. Customers are increasingly looking for natural and sustainable alternatives in the home care space. There is a growing demand for multifunctional natural products, and customers are willing to pay a premium for them. 

In this episode of The Chemical Show, host Victoria Meyer invites Aaron, an industry expert and leader in the field of chemical distribution, to share insights into the different segments of their business, including home care, industrial and hospitality, and auto appearance. Victoria and Aaron discuss the challenges and opportunities for innovation in science during the pandemic. Aaron shares how Univar Solutions played a part in this story, especially with their home care and industrial cleaning team.

Join us as Victoria and Aaron discuss the following topics this week:

  • How the cleaning industry keeps the economy healthy, fed, clean, and safe
  • The post pandemic shift to innovation in the cleaning industry
  • Natural and bio-based products in the cleaning industry
  • How the pandemic changed global consumer behaviors in home care, auto, and hospitality cleaning industries
  • The quest to create more natural and sustainable products
  • The role of chemical industry distribution now

Victoria and Aaron discuss Univar Solutions’ commitment to expanding their portfolio of sustainable and eco-friendly products, and how they work closely with customers and suppliers to develop innovative solutions. Aaron also sheds light on the evolving role of chemical distribution companies, where they not only provide logistics but also play a crucial role in driving innovation. Tune in to gain valuable insights into the declining hospitality industry, the importance of sustainability, and the future of chemical distribution in the cleaning industry.

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Innovating Sustainable Solutions

Hi, this is Victoria Meyer. Welcome back to The Chemical Show. This week, I am speaking with Aaron Lee, who is the Global Vice President of homecare and industrial cleaning for Univar Solutions. Aaron brings many years of experience in the homecare and industrial cleaning industry, both in distribution and as a producer. Prior to joining Univar Solutions, he held several key leadership positions at Pilot, Velsicol, and Eastman early in his career.

Aaron and I had a great conversation about what is going on in these industries. Aaron, welcome to The Chemical Show. 

Thank you, Victoria. Thank you for having me. 

I’ve been listening to the Chemical Show podcast for quite some time, and I appreciate the opportunity to talk about my business in the homecare and industrial cleaning space. 

I am always glad to have loyal listeners and glad to have you here. Let’s start with your origin story. What got you interested in chemicals and what ultimately brought you to Univar?

I hear the term origin story and I think it’s maybe because I have young kids, but I think about comic strips and some of the origin stories for Spider Man. So mine’s maybe not as exciting as being bit by a radioactive spider, but I do think I have a kind of an interesting origin story.

My background is maybe not the same as a lot of the people in the chemical distribution space. I started off as a major in management and psychology at Loyola University in Chicago. So I started off in that space, then had a little bit of background with organic chemistry, because I was pre-med probably like a lot of students in the college space, but I quickly decided that’s not the route I wanted to go.

After I graduated from Loyola. I started looking for roles in pharmaceutical sales, and didn’t find a role in pharmaceutical sales. So I started with a company called Velsicol Chemical, and that’s led to 22 years in the chemical industry. I started off with an inside sales role with them.

 I’ve moved around a little bit after Vesicle. Then I really started to cut my teeth with Pilot Chemical, where I spent 11 years working with them in different capacities. I started off in a region in Chicago, then they moved me to Cincinnati to manage their distribution sales. Did a few years managing the North American organization. When I finished with them, I was head of their global sales organization. That’s where I actually came up on a position with Univar Solutions.

 It was really interesting. At an ACI event in 2017 I met with some of the leaders from Univar Solutions. They’re talking about what they were building within Univar that was different from chemical distribution. It was something called Organized to Win that was led by David Jukes, our CEO, and really looking at the different market verticals and specialty chemical sales and they were building out a product horizontally focused on surfactants and chelants. That was my background at pilot chemical. I said, this is really intriguing and a different look at chemical distribution. So I was intrigued by the role and started talking to some of their leadership a month later. Then by the end of February had taken a role with Univar Solutions.

For me, it was just a great opportunity. To see the whole chemical industry and the partnerships that Univar Solutions had, I was part of a smaller space at Pilot Chemical with their surfactants, their biocides, their quat chemistries, but this gave me exposure to a much larger area within the chemical distribution space. It’s been a really rewarding journey at Univar Solutions. Being here 6 1/2 years, I moved from Cincinnati down to the Woodlands, Texas, where I took on a role heading up this homecare and industrial cleaning business in the US.

 Based on the success of that industry, we grew our business to 70+ professionals focused on homecare and industrial cleaning just in the specialty space. That’s sales. That’s marketing. That’s technical support. That’s product management. We have seven global solution centers where we do technical support for our customer base. It’s genuinely been a real rewarding opportunity at Univar Solutions, and we continue to grow in this space. It’s been a lot of fun.

That sounds good. I mean, it’s actually interesting to go from pre-med to not. Although I guess I would say Aaron, what’s interesting about your story is it sounds like you’ve always been really in the commercial side of things. From a sales and a commercial perspective much like being a doctor or pre-med student, it’s all about diagnosing and coming up with solutions.

Yeah, that’s where the portion of one of my degrees in psychology may come into play a little bit, having to deal with people. Early in my career before I went into the chemical industry, I did recruiting. So I did three years of recruiting as well.

That along with my MBA and finance and entrepreneurship, has been kind of integral as I build out teams. Having that background, that entrepreneurship piece, that recruiting piece.  I have a big team. It’s important that we fill those critical roles with the right players.

I feel like we’ve really done that at Univar solutions and have a fantastic team. 

That’s really cool. The pandemic certainly brought the cleaning market into sharp focus, whether it be household, whether it be industrial, who doesn’t know about hand sanitizers and all the various formulations, whether you really understand them or not if you’re on a consumer basis. Certainly we saw a lot of growth in many end uses. Now we’re seeing a bit of retraction in the markets and across chemicals generally. What stood out for you and for Univar during that time frame, when we think about the changes that the pandemic brought about?

Thinking about the pandemic really, I just looked at the critical role that distribution played during the pandemic. If you look at our distribution sites, the 130 in North America, all of our global facilities, none of those closed during the pandemic. Whether it was our operations individuals or our drivers, they were out there keeping everybody healthy in the economy.

Our team actually was busier than they ever were. Whether that was work done in our solution centers, or we still had people doing technical support, our application development teams making calls to our customers and supporting all those new formulation ideas and making sure that we stayed in place with the regulatory side.

Our sales team was offering the ingredient and formulation support and really for me, it was really one of the proudest parts of my career. At Univar, our purpose is really to keep our economy healthy, fed, clean, and safe, and what an important role that homecare played in that.

I recently heard an interview by Neil Young, and it was kind of interesting. He’d said the challenges during the world pandemic, he was really happy to be a part of that, and it was a great time to be alive, despite all the suffering that happened. But I can definitely see that, right?

The innovation in science. In our own way, Univar Solutions played a part of that story, and definitely with our homecare and industrial cleaning team we had a big part of that story as well. 

Yeah. So what changes do you see happening now that we’re in the post-pandemic world? How is that shifting from where it was for the early part of this decade? 

I will talk about this in 3 spaces. For our homecare and industrial cleaning business we have 3 key sub segments that have all really behaved a little bit differently post-pandemic.

Whether that’s our homecare business, our industrial and hospitality business, or our auto appearance business there’s been different trends. So, hopefully we’ve moved past some of those foul smelling hand sanitizers and long supply chains for hard surface disinfectants.

Across all those three subsegments, innovation has been the forefront post-pandemic. I hate to go back to ACI again, but ACI in January of 2020 was all about 1.4 dioxane regulations. Shortly after that, a month or 2, the world shut down. ACI at the beginning of this year was all about sustainability. It was about green. It was about biosurfactants. So that trend has been huge. That’s been a big part of the homecare space. 

In homecare, we’ll talk about how first the focus has been around multifunctional natural products, cost effective prod opportunities as well, but natural has become a little bit ubiquitous. A lot of the end producers are looking at more natural formulations. You have natural claims in Europe for example, about 75 percent of those products have some type of natural claim on liquid detergents. The US follows very closely in the 70%. Latin America around 50%, and APAC around 40%.

So you have to do a little bit more with those formulations. Customers are looking to innovate. So it’s taking maybe a hard surface cleaner and adding in a microbe to it to add that continuous clean to have longer lasting cleaning. It’s having high efficiency laundry detergents that can run at low temperatures and offer odor elimination to things like athletic garments. So the consumers are willing to pay a little bit more but they want to have that multifunctionality. 

Yeah. I’m going to jump in here because I think natural is a bit of a misnomer. I think that’s a great marketing ploy for consumers, but the reality is behind the scenes, these are all chemically processed. It’s not like I’m going and getting a leaf out of my garden to wash something. From where you sit and I know you guys do a lot of work from a formulation perspective and have helped your customers formulate.

What’s the balance? When we start thinking about, what does it take to be called a “natural” bio-based product? Is it a 10% formulation? Is it a 20% formulation? What do you see as really driving it? 

Yeah, I really see this in the homecare space and also the industrial and hospitality spaces. It’s just what our technical lead on the ads side calls the green spectrum. So customers might be using very petroleum drive formulations and can we take those formulations, add something that has a natural base feedstock and make it 10% or 20% more green. Where is the customer on that journey? I think you’ll find the homecare customers maybe a little farther along than some of the industrial customers. Can we take a green solvent and add it to the formulation? Can we add microbials or enzymes to make them a little bit more green?

There’s been a big DDBSA which is the biggest component of a lot of detergent formulations. So how can we help evolve that conversation around those formulations to be more green on that green spectrum? 

Interesting. So that’s what’s going on in homecare. What are the other areas and trends that you’re seeing?

On the auto appearance side, the pandemic brought a boom for self car washes. So you’re at home, you’re looking for something to do. I did it myself. Go out in the front driveway. Grab your kids, wash your car, give them an activity to get outside your house. 

Now since the pandemic’s behind us, there’s been big growth in tunnel washes. A decade ago, tunnel washes were probably going to be going away. The industry reports now are showing that tunnel washes are actually going to double in size in the next five years. I don’t know if you notice around the Houston area here, but it seems like there’s tunnel washes popping up on every corner. So we’re trying to take advantage of that opportunity.

To create more sustainable solutions with things that we have like kits. We put together kits for our customers. We don’t do a finished formulation that we sell, but we work with our tier 2 and tier 3 customers to create things like pre soaks or ceramic coatings or drying agents or tire shines. 

So what’s driving this?

That’s interesting because you’re right. I have absolutely noticed. I will say I’m hoping in the community where I live that we are past the whole stage of building more car washes. About five years ago, I swear everybody’s like, “Oh, it’s what’s coming up over there”  “It’s a car wash.”

Right now we’re into coffee shops, so my neighborhood is getting surrounded by coffee shops under construction. But what’s driving that car wash phenomena, because you said 10 years ago, you thought it was on the decline? The pandemic changed some just consumer behaviors, but now you’re saying it’s increasing.

What are you guys seeing that’s causing that trend to change? 

Yeah, I think there’s probably a couple different things that are making that change. Globally, there’s 8 million cars that are washed every day. That’s a lot of cars. But also, if you  think back to the pandemic, it was just hard to get cars that were not super expensive.

Are you able to hold onto your cars longer and extend the life of your cars? A lot of these auto appearance tunnel washes can help with that.  You have different price points, some of them have a ceramic coating, some offer different types of applications. So I think that has been kind of a boom on these tunnel washes that we’ve seen in the marketplace. 

That’s interesting. I gotta be honest with you, Aaron, I basically always opt for the basic wash whenever they’re trying to upsell me. I’m not upselling, just give me the basic wash. My car’s dirty. It needs to be clean. Let’s roll. 

Well, I encourage you to try out the high end washes. So you’re not getting things like tire shines. So when you look at your tires, they are probably not as bright. 

That’s what I have my husband and kids for. 

Yeah, true. But then you also don’t get the fun foam that’s colored.

That’s true. Animations, you’re right. I just hadn’t realized that was a growth market at this point. 

 What’s the third area that you were going to touch on in terms of markets? 

That would be our industrial and hospitality space. You can almost look at that in two areas. The hospitality side, if you think about the travel that you do staying at hotels, getting on planes, going to restaurants. Some of that has changed quite a bit over the past few years. Some of it, maybe not for the best of the cleaning industry, if you stay in a hotel longer than one night, nobody’s coming in and cleaning my hotel.

I think there may be some opportunities for different types of cleaning, like some of that long lasting cleaning that you can do in those spaces. For planes, if you get on a plane, they used to go through and use misters on the planes. You don’t see that anymore. You’re maybe 50% of the time just getting the hand sanitizing wipes when you walk on the plane.

So that has maybe not been as good for the cleaning industry. On the I&I side, things like automation. You’re going to see some innovation and automation. Not that you’re going to get rid of custodial services but just allow for these robots to machines to clean more efficiently.

The Internet of things will pop up, monitoring usage for wear, wash, laundry, dispensers, and lots of other things.

I think the hospitality space broadly, as you start talking about hotels and restaurants and stuff, it absolutely doesn’t feel as clean as it used to be. How significant of a decline are you guys seeing across the industry on that? Is it anticipated that it’s going to pick back up? My observation is there’s so many micro markets around this.

Travel being one thing that’s very regionalized. I think about it from a restaurant hospitality perspective, we’re both in the Houston area. If you go to downtown Houston, the number of restaurants that are available downtown is probably half of what it was pre-pandemic because people aren’t in the office and they’re not going out to eat.

We’ve seen a pretty dramatic overall shift or at least a geographic shift in some of those services. Is that what you see as well? Or is there anything else that really stands out? 

I think that’s correct. When you look at the I&I side of the business you saw that side of the business really slowed down in the middle of the post-pandemic.

When you saw the homecare side, because people were staying at home, they’re washing their clothes. They’re cleaning more and have a bit of an uptick. Now we’ve actually seen a little bit of a shift where the industrial and institutional were a little bit slower but that business is starting to see a rebound as well.

One space declines and in another sub-segment, you see the growth. Overall there has been some softness as you looked at the 2nd half of last year in the HIC space but we’re starting to see turnarounds in places like the I&I side where you had a bit of a slowdown post-pandemic.

You started referring to sustainability as one of the key trends and certainly I know you’re right. ACI pre-pandemic and post-pandemic. Sustainability is the hot topic everywhere as well as green and bio based products and things that are actually driving us to a lower carbon future theoretically. What’s on Univar’s sustainability agenda? 

Sustainability is an important part of our organization. So much, that we have a sustainable and natural products team. That’s actually headed up by our VP of natural and sustainable products, Kelly Gilroy. I think she’ll actually be speaking at The Chemical Summit coming up in a couple of months.

Yeah, absolutely. She’ll be there at The Chemical Summit, which will be great. She’s also been on the podcast briefly about a year or so ago. 

When I look at our HIC team, we have three pillars when we think about natural and sustainable products. First is we’re really focused on expanding our natural and sustainable product offerings. We do that in a few different ways. Trying to talk to our customers about what they’re wanting to formulate. What type of new technologies we’re looking for. We have goals within our team to bring on a number of new sustainable products or natural offerings. We do formulation work to help support that.

Increasing the number of product offerings that we can take to our customer base. Also for distribution, we play a key role in having an eco-friendly supply chain. That’s where we can have one of the biggest impacts. I’ve heard of it referred to as the green highway.

How do we have more efficient trucks, more efficient forklifts? How do we help our supplier community move from less than truckload to a full truckload or from a full truckload to rail? From a more eco-friendly supply chain, you’ll see in the coming years distribution playing a much larger role than we even do today.

Yeah, it sounds like it goes into the whole type 3 emissions reductions effort. A lot of companies are really trying to reduce and measure. 

That’s correct. Then the 3rd place for the homecare industrial cleaning business, it’s working with our technical solution centers and our application development specialists just formulating with more natural offerings.

We were talking a little bit earlier about how you go from 0 percent to maybe 20 percent and finding our customer and where they’re at in that journey and helping them get a little bit more green or more sustainable. We have 7 global solution centers that help formulate and each one of those formulation solution centers has a list of projects and probably anywhere from 45 to 50 projects that they’re working on.

A lot of those are around sustainability. 

Obviously it sounds like it’s really customer centric, which is also where it needs to be. What role do your suppliers play? You guys are really sitting in the middle, so how do you help align that customer and supplier journey from an overall perspective?

That’s one of those mysteries in life, being the spider in the middle of the web. How are you navigating between those multiple players? 

I think we actually play one of the most important roles.

When it comes to innovation, innovation really does help happen in the distribution space. I found that throughout my career, whether I was working at a producer like Pilot Chemical or now during my time here at Univar Solutions, Tier 2 and Tier 3 try to innovate just as much as those multinationals do.

However, a lot of times they might not have the technical support that we can offer. That’s where we work with our customers, find what the needs are. Then we’re always talking through our product management organizations. Having those conversations with the suppliers about what their next ideas around innovation are.

A lot of times we’ll take back ideas to them and they’ll say, “Hey, maybe we can help you produce that molecule.” So we have a pipeline of opportunities. We take back coordinate with the supplier base and they come up with some sustainable solutions to help us support.

Sometimes they’re pushing them towards us and other times we’re bringing them some of the ideas in the marketplace. 

I think that’s interesting. It’s definitely a bit of a push and pull, because the ideas and the opportunities sit in different places.

So, when you think about this, the other unique piece to me about distributors such as Univar Solutions is you’re serving in some ways two different customers. From your suppliers, your principals, whoever you’re getting the feedstocks and the products from.

Your customers have certain expectations. You’re filling a really critical role for them. Then obviously the end users that are using the product. So how do you guys think about the customer experience as it applies, not just to your formulators and your actual customers, but also when you look back up the value chain to your suppliers? What’s important there for you and for your business partners?

When you think about the journey from supplier to customer it’s just really trying to align. I think alignment transparency is what’s key to those relationships. I was fortunate enough during my time at Pilot Chemical to see some of the best in the industry, Univar and Nexio, that provided that transparency and really aligned on what your targets and expectations are between your supplier community and your customer base.

As long as you have that transparency you provide a lot of value in the marketplace. Providing those technical solutions to some of those customer challenges is ultimately what our sales organization is looking to do. So we’ve allowed them to go out there and sell those solutions, but we have some of the best in class product management and supplier development teams that help us manage some of that conflict that could potentially come up in our supplier base.

Yeah, because I would imagine that it can be difficult to figure out what products you take forward to a customer. That there’s some tension in the relationships when you think about the wide array of suppliers that you have, the wide array of customers and how you select products that go to certain customers. Can you elaborate on that at all? What’s the process that you guys go through? Because again, that’s one of those mysterious parts of distribution. How do you strike that balance? 

What’s key there is just setting expectations really early at the beginning, right?

Aligning on what molecules and what solutions that supplier wants to take to the marketplace. I’ve found the best practices when I was in a distributor manager role within Pilot Chemical from some of the distributor partners are being aligned. Transparently setting those targets and having expectations with regular check-ins becomes so important. Setting those goals at the beginning of the year and checking in on a quarterly basis of how you’re doing with that from a leadership level, with the product management teams, with our technical teams that’s where success really ends up is if you have aligned targets and goals, you know which portfolios you want to push from the supplier base. 

A lot of times we have sales organizations and technical organizations that can be larger than our supplier base. So if we can take that message from our suppliers and take that out to the marketplace in the tier 2 and tier 3 customers, we’ve really provided a great service to our supplier base.

Makes sense. So I know you started alluding to this earlier Aaron, the role of distribution, how has it changed? You came into Univar Solutions having been with producer companies. So one, what surprised you when you got into Univar and then two, just how has the role of distribution changed and evolved?

Yeah, distribution is no longer just a logistics supplier. That’s an important core component of what we do. It’s really not the only thing. What I’ve seen in distribution, especially at Univar Solutions, is just the technical innovation that can happen.

I mentioned earlier the number of projects we have in each one of our solution centers. It’s 45 to 50 at each of these 70 global solution centers that we have. We can do performance testing, application development, providing the different natural and sustainable offerings. My view of distribution has really changed from where it was at in ACI in 2017 before I joined Univar.

Part of my discussions when I took the role were some of those questions of maybe the past 10 to 15 years that I had on distribution and how much it had changed. As part of the organization to win these dedicated market industries that we have in homecare, industrial cleaning, personal care, it’s really a unique view of how we go to the marketplace that we’re still a lot of times sharing our story for.

We’re only four and a half years old. Two years globally. So we’re still taking that message in terms of the technical support we can offer. I was traveling in Kirkland, Washington last week. Univar was founded in Seattle in 1924, we’re almost a hundred years old. So for that old new company, I would love to know what George Van Waters or Nat Rogers would think about the organization today because it looks a lot different. 

Also what I noticed at our Kirkland Washington facility is two things were very important. It was great to see the history and where Univar started. But despite all the innovation, and technical support that we offer, distribution still plays an important role at those distribution sites, and at those warehouses with that logistics piece. So Univar Solutions has the capability to bring both the technical service and the best in class logistics that a lot of our competition can’t.

That’s great. So what’s next for you and for Univar? What should we be looking for in the rest of 2023 and going into 2024? 

One of the big things we have coming up is what I call our global solution center days at our technical facilities or solution centers. We’ll have supplier presentations through leadership around tables.

We also have a session called Chemists Helping Chemists. So we’re bringing our customers and our suppliers together at these solution centers in Houston and Essin, Germany and Sao Paulo, Brazil and Mexico City. Just a great opportunity to talk about how we’re different, like we were talking about earlier.

How has distribution changed? I still think there’s a segment of our customers that have yet to see what Univar Solutions can do from a technical perspective in homecare and industrial cleaning. 

We’ll be launching something called Cleaning Around the World Kit. I was very fortunate because my travels have customers in Mexico asking what customers in Europe are doing, customers in Europe asking what we do in North America. So we’re putting this kit together to talk about some of those trends we were mentioning earlier to take to our customer base.

For me, I’m just personally excited to continue to build this HIC brand across the globe. I work with some great people and am very fortunate to lead a global team of really talented individuals. You’ll continue to see us invest, continue to bring on new suppliers and find other businesses that might fit our model.

Awesome. We’ll watch this space. There’s a lot going on in the world of Univar. Well, Aaron, thank you for joining us today on The Chemical Show. I’ve enjoyed having you here. 

Thank you, Victoria. 

And thanks everyone for joining us today. Keep listening, keep following, keep sharing, and we will talk again soon.

About Aaron Lee:

Aaron Lee brings many years of experience in the Homecare & Industrial Cleaning industry both in distribution and within the chemical producer community. He is currently the global vice president of the Homecare & Industrial Cleaning vertical at Univar Solutions. Within this position, Aaron is responsible for growing market share and driving profitability for HIC globally. Previous to this position, Aaron held leadership positions within Univar Solutions standing up the North American HIC team, leading the Chemical Manufacturing organization and standing up a product management horizontal responsible for surfactants and chelants. 

Prior to joining Univar Solutions, he held several key leadership positions at Pilot Chemical, including leading the Global sales organization, North American sales, and distribution channel. Pilot Chemical is a leading producer of surfactants and quaternary chemistries. Within these roles he was responsible for business across various industries including HI&I, Oil & Gas, Lubes & Metalworking, and Adhesives & Sealants. Aaron also held sales leadership positions at Velsicol Chemical / Eastman early in his career. 

Aaron has an MBA in Finance & Entrepreneurship from DePaul’s Kellstadt Graduate School of business and an undergraduate degree from Loyola University – Chicago. He also completed executive leadership training at the University of Chicago. He has held various leadership positions, including a member of the Future Leaders Board at the American Cleaning Institute. Pastimes and activities include running, cycling, exercise and coaching sports teams. His proudest achievement is being the father of two fantastic young men, Camden & Greyson.