Dow Corning's Platinum Index Pricing Strategy Meets With Success
January 09 2007 - 1:00PM
PR Newswire (US)
MIDLAND, Mich., Jan. 9 /PRNewswire-FirstCall/ -- Dow Corning
Corporation, a leader in silicone technology for the global
pressure sensitive industry, took a bold new tack in the battle
against rising platinum prices last July when it implemented an
innovative index-based pricing system for its global pressure
sensitive product line. Now, six months later, Dow Corning says the
strategy has successfully allowed the company and its customers to
better manage swings in commodity platinum metal pricing, which has
more than tripled since 1999. Dow Corning's model, based on a
quarterly average platinum metal cost index, establishes a base
product price and then separates out the commodity portion as a
discrete line item. Index-based pricing is common to many
industries that are sensitive to commodity costs. "Index-based
pricing provides transactional transparency -- customers clearly
see that Dow Corning is not using the price of platinum for
financial gain," explains Norm Kanar, Americas marketing manager
for Dow Corning's Pressure Sensitive Industry. "If the cost of
platinum goes up, it's reflected in the price. But when the cost
goes down, we pass those savings along as well." Kanar adds that,
as a case in point, Dow Corning plans to reduce the platinum
component of its product pricing in Q1 2007 to reflect recent
declines in the cost of the metal. The shared risk and reward of
index pricing is just one way that Dow Corning has been very
effective in supporting the pressure sensitive industry. The
company offers many products and capabilities to help customers
reduce their platinum needs. For example, Dow Corning's Syl-Off(R)
Advantage Series Solventless Silicone Release Coatings require less
platinum catalyst to achieve good cure than conventional coatings.
In fact, the company's newest additions to the Advantage Series
line have the lowest platinum requirements in the industry,
offering good cure at platinum levels as low as 25 ppm. In addition
to reducing platinum requirements, the Advantage Series also
provides improved line speeds and more efficient release
performance control. Customers worldwide have responded
enthusiastically: over 60 coaters in 20 countries now run Advantage
Series products on their lines. To learn more about the Advantage
Series and all of Dow Corning's pressure sensitive solutions, visit
http://www.dowcorning.com/psi. For more information about the
platinum commodities market, go to
http://www.platinum.matthey.com/. DATASOURCE: Dow Corning
Corporation CONTACT: Nancy Collins, of AGP & Associates,
+1-989-839-5800, Web site: http://www.dowcorning.com/
http://www.platinum.matthey.com/
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