01 Apr
The Challenges of Chemical Regulations and Bureaucracy in the Paint and Coatings Industry The European paint and coatings industry is facing mounting challenges due to increasingly stringent chemical regulations, outdated workflows, and resistance to digital transformation.
Companies are struggling to comply with complex legislation like REACH (Registration, Evaluation, Authorisation, and Restriction of Chemicals), CLP (Classification, Labelling, and Packaging), and OSHA’s Hazard Communication Standard (HCS) revisions, while trying to compete with manufacturers from India and China who benefit from lower regulatory costs and streamlined processes.
This regulatory burden is not only eating into profits but also creating inefficiencies within companies that are reluctant to modernize their workflows. The result is a fragmented approach to compliance, operational inefficiencies, and an increasingly difficult global competitive landscape.
The Financial Impact of Regulations on European Companies European companies in the chemical industry spend billions annually on compliance with regulations aimed at protecting health and the environment. These costs stem from audits, substance evaluations, labeling updates, documentation requirements, and penalties for non-compliance.
REACH Chemical Compliance Costs:
- REACH fees are set to increase by 19.5% starting April 2025, with annual expenses expected to reach €33–34 million between 2025–2028.
- The cumulative costs of EU chemical legislation were previously estimated at €9.5 billion annually, with the paint and coatings sector among the hardest-hit industries.
- OSHA’s HCS Updates (U.S.): • The updated OSHA Hazard Communication Standard (effective July 19, 2024) aligns with GHS Rev. 7, introducing stricter hazard classifications, labeling requirements for small containers, and expanded precautionary statements.
- Compliance deadlines extend to January 19, 2026 for substances and July 19, 2027 for mixtures.
These increasing compliance demands are placing European and US manufacturers at a disadvantage compared to competitors in India and China, who operate under less restrictive frameworks. They can offer significantly lower prices due to reduced compliance costs and cheaper production methods. This competitive disparity puts additional pressure on European firms.
Data Fragmentation:
A Major Obstacle in Digitalization One of the biggest challenges within European companies is the reluctance to adopt centralized systems for managing data. Many firms still rely on Excel spreadsheets or legacy systems like SAP—despite SAP’s dominance as Europe’s largest software company with €315 billion in revenue. Its UI and UX have changed, but they remain complex and expensive.
The business SaaS model for chemical compliance is stuck in the past. Customizing monolithic systems for every client is an outdated business model.
A real-world example highlights the issue:
At a European Coatings Show, three R&D employees from one company revealed that their 14-person departmentmanaged formulations in individual Excel files. If someone is unavailable, project progress stops because no one else has access to the data.
This siloed workflow increases regulatory reporting risks, delays product development, and blocks collaboration. Despite the promises of digitalization, many companies remain trapped in outdated processes.
How Digital Solutions Are Transforming Chemical Compliance To address these challenges, platforms like Chemius, Allchemist, and Parser AI are automating processes and centralizing data into accessible, efficient systems:
Chemius: • Automates SDS creation, regulatory updates, and label generation in seconds • Centralizes compliance data for company-wide access • Reduces manual work by up to 70%, cutting time and cost.
• Offers digital tools for formulation management and regulatory tracking
• Integrates all formulation data, preventing data silos
• Accelerates adaptation to REACH or OSHA HCS changes
Parser AI* by BENS Consulting:
• Extracts data from PDF safety data sheets in 10 seconds
• Transforms unstructured info into structured formats for Chemius
• Eliminates manual entry errors and boosts workflow speed
These solutions resolve inefficiencies caused by data fragmentation while ensuring compliance with REACH, CLP, OSHA*, and GHS Rev. 7 standards*.
* Note: These tools are internally developed and will be available to end users in the coming weeks/months.
The Benefits of Centralized Data Management Centralizing chemical data into a single platform delivers:
• Improved Collaboration – Shared access to updated data
• Reduced Errors – Standardization limits inconsistencies
• Faster Compliance – Automated regulatory updates
• Cost Savings – Manual work is minimized, reducing expenses
The Future of Digitalization in the Chemical Industry Despite frequent talk of transformation, many European companies cling to legacy systems like SAP or rely on inefficient manual processes. Yet, small teams like BENS Consulting (25 employees) are proving that cutting-edge AI tools can drive meaningful innovation.
Platforms such as Chemius and Allchemist show how automation streamlines operations and reduces costs. Parser AI helps companies bridge the gap between compliance complexity and modern workflow.
If European chemical companies want to compete globally, they must move away from fragmented systems and embrace 21st-century technology focused on collaboration, automation, and efficiency.
And if you’re ready to make that shift, we can help. https://www.allchemist.net/roi-calculator/ you can try our ROI calculator to see where you stand and where you should stand.
Contact us at info@bens-consulting.eu for more details.
