Volume 7 | Issue 1 | Year 2004

As a company specializing in products that act to enhance the senses, Sensient Technologies operates with a keen sense of where it has been and where it is going.

Sensient knew where it had been; its food products had served a vital niche but its production base needed a boost into the 21st century. Seven years ago when he took the helm as CEO and President, Kenneth P. Manning formulated the plan for growth into an industry from which the company now derives its name and its mission – “to enhance sensory experiences through specialized ingredients, delivered through proprietary technologies.” Today Sensient provides colors, flavors and fragrances to a broad range of industries, including food and beverage, pharmaceutical, cosmetics, personal and home care, ink jet and specialty inks, display imaging and industrial colors.

It was a transformation that culminated a long road of strategic acquisitions and relationship building on the part of Manning, a retired rear admiral in the U.S. Naval Reserve, giving new meaning to tenacity and perseverance. Sensient Technologies had been known as Universal Foods until the name was changed in 2000 to reflect the company’s much broader range of products and more sophisticated technological edge. Founded in 1882 as a manufacturer of gin, the company was called the Meadow Spring Distillery; in 1887 it began to manufacture yeast as a natural outgrowth of the fermentation process; the product was called Red Star Yeast and its unit remained part of the company until 2001.

At the time the decision was made to overhaul the company’s strategic plan, Universal Foods was a commodity food business that had seen its day, in Manning’s opinion. For example, he explains, “When we sold the yeast business in 2001 the price of yeast was the same as it was during the Depression and today, it’s 20 percent lower.”

Growth through acquisitions
The biggest issue, he adds, was how to grow. “We had developed a matrix to complete our strategic picture,” he explains. “Sensient needed to make strategic acquisitions of companies that would complement its new direction.” Nearly 20 acquisitions and seven years later, Sensient has become a spectrum of innovative enterprises across the globe with expertise ranging from specialty inks for ink jet applications to colors, flavors and fragrances for food and nonfood products, such as cosmetics. All of these units now operate under the Sensient Technologies banner.

“I negotiated all the transactions myself,” explains Manning. “It took a lot of relationship building.” Among these relationships was one Manning was instrumental in nurturing with a cosmetic color manufacturer based in France. What was a $10 million business in 1997 when the company was acquired is now responsible for $50 million in sales; Sensient is now the largest company providing colors for cosmetics.

In the fragrance arena, Manning recognized the potential of a company in Granada, Spain, which also supplied businesses in France. Having an association with the French cosmetic color producer has been advantageous, relates Manning, in marketing the fragrance side of the business. Another milestone for Sensient was its acquisition of a company in Germany on the cutting edge of thermal transfer technology. “They produced photographic chemicals and had significant technological expertise in organic chemicals for light emitting diodes. It’s fourth generation technology for flat screen TVs – very leading edge,” Manning says.

Sensient has come a long way from its roots in the yeast business. Six years ago, a bakery was its largest customer. Now, Sensient counts a giant desktop inkjet print company as its largest customer. Manning adds that one of the biggest milestone of the last decade was the sale of Red Star Yeast. “It confirmed the new era of state-of-the-art technology and represented the end of the old era,” he recalls.

Enhancing the world
With corporate offices in Milwaukee, Wis., Sensient’s global reach encompasses the following: Flavors and Fragrances Group, 31 locations extending from Indiana to California to Ontario, and including Brazil, Belgium, Spain and Sweden; Color Group, 29 locations extending from New Jersey to Missouri to California, down to Mexico and including Argentina, Czech Republic, Germany, Italy, Poland, Romania and South Africa, and the Asia Pacific Group, stretching from Japan and China to Korea, Thailand and Australia.

Each of Sensient’s groups offers a high level of technology and research and development expertise. These complement an overarching philosophy to deliver on the company’s promise. “You have to give the customer what he wants, not what you think he wants,” remarks Manning. A corporate customer may demand, for example, a certain shade of lipstick with certain characteristics for a new lipstick line. Sensient is able to respond to such a request within days and can further compete against the bigger players through its diverse product line. “Because of our strategic acquisitions that broadened our product line, we’re now one of the few flavor companies that can also develop colors. “Sensient, he adds, has an enormous product library, with more than 30,000 formulas alone for the food and beverage industry and about 3,000 formulas in the color area. “With few exceptions, literally every product is a customized product and I can’t think of any place where you can’t find our colors and flavors,” Manning says.

The following is offered by Sensient in each of its product areas:
•Food and beverage: Sensient Food Colors provides a full spectrum of dyes, pigments and natural colors for the confectionery, beverage, processed foods, bakery, dairy and pet food industries. Sensient Flavors supplies custom-designed flavors and flavoring systems to the food, beverage, bakery, dairy and confectionery industries. Sensient Dehydrated Flavors supplies dehydrated vegetable products and flavor systems to the food industry, and Sensient Bionutrients provides high-quality bionutrients for fermentation and cell culture. Beverages, in particular, represent one of the top market segments for the use of colors. Carbonated, dry-mix, juice-based, new-age and sports-related beverages are among the many products Sensient helps formulate. Sensient also provides a full range of synthetic dyes, natural colors and custom blends which give the perfect shade, but can also neutralize many of the variables that can cause instability.

•Pharmaceuticals: Sensient Pharmaceutical Technologies is the pharmaceutical unit of the Color Group, a division of Sensient Technologies focused on enhancing customers’ products through the use of high-quality sensory additives. The Color Group of Sensient Technologies is the world’s leading manufacturer and marketer of regulated colors, offering the broadest range of natural and synthetic colors available for pharmaceutical use. Sensient offers a variety of color and coating systems to fit customers’ specific product needs, including Spectrablend(tm) and Spectracoat(tm). Sensient Pharmaceutical Technologies’ multinational customers include makers of prescription, over-the-counter and generic drugs, as well as vitamins and nutritional supplements. Among the coating systems the company offers are Spectrablend, Spectrafilm(tm), Spectracoat and Spectraspray(tm).

•Cosmetics: Sensient is the world’s leading supplier of synthetic and natural colors to the cosmetics industry and also supplies fragrances for perfumes. Its global reach has helped the company develop exclusive relationships with well-known cosmetic companies around the world. Sensient’s proprietary pigments and state-of-the-art color development techniques offer color stability and eliminate color bleeding. Innovative shades, hues and tints add to a growing selection of technically sophisticated color products available to Sensient customers. In addition, Sensient provides color solutions for products in which fading is a problem, such as cosmetic lotions, creams, lipsticks, powders and eye make-up. Sensient also supplies the cosmetic industry with the products used in manufacturing make-up, hair and skin care products, toiletries and fine fragrances. Examples of these products include sunscreens, light reflectors, active ingredients, products and skin texturing materials. All manufactured batches of color are subjected to exhaustive testing to guarantee consistency, purity and reliability and to ensure that a product’s shades, strengths, particle sizes and other criteria meet customers’ strictest demands.

•Personal and home care: Sensient manufactures and supplies ingredients used to make personal care, fabric care and home care goods. With its expertise in colors, specialty ingredients and fragrances, the company is able to provide combined manufacturing solutions for the personal, home and fabric care industries. Sensient’s technical and marketing team works together with customers to create winning brands.

•Performance Chemicals: One of Sensient Technologies’ primary strengths is its expertise in chemistry related to digital and analog printing. Sensient offers a full spectrum of products and capabilities for digital imaging, including finished inks, component dyes and pigments. Key digital printing applications include: desktop inkjet printing for home and office; photographic printing; wide-format printing for graphic and commercial applications; specialty printing for industrial and commercial applications. Sensient also produces the chemicals used in Organic Light Emitting Diodes for flat panel displays.

Sensing trends
Sensient now sees itself on the ground floor of exciting trends that have developed in its product areas, particularly relating to digital imaging and flat panel display technology. In the pharmaceutical arena, Sensient sees opportunity in China in producing coatings for pharmaceutical tablets, as well as in digital imaging, beverages and household products. Other promising growth areas are Eastern Europe and Latin America.

To capitalize on these opportunities, the company has launched major construction plans at facilities across the globe; these include construction of flavor and color plants in China and modernizing a cosmetic color plant in Brazil. “The days of outdated facilities are gone,” Manning notes. “We have modernized virtually all of our facilities.”

Manning points out that today two-thirds of the company’s employees are foreign nationals, whereas 10 years ago, they comprised under 5 percent of the employee base. “With a strong organization, we can execute a sophisticated strategy,” Manning says. Part of this strategy is to develop the company’s future leaders. “We are a widespread organization but I strive to keep in touch with all of my managers.”

As the future unfolds at Sensient, the company will continue to leverage core technologies, scientific expertise and state-of-the-art facilities to drive growth. It all comes down to having sense enough to make a turn toward global greatness.

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