Porter five force model for shipping port

Before global recession wholesale price index WPI inflation was high due to increase in commodity and fuel prices, with subsequent y decreased due to meltdown in global economy which has resulted in sharp decline of commodity prices. Literally speaking suppliers of these services hardly make any difference to shipping line, financially as well as socially.

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Industry growth is high, so the chance of exit from the industry is less. Businesses are increasingly catering to rational, practical and current cultural needs and are not based only on traditional models and offerings.

Porters five forces maersk

Bargaining Power of Suppliers Suppliers barely make any difference to companies involved in shipping line business, especially to the dominating shipping companies. Availability of the substitutes is high. A ship emits less CO2 per tonne of goods transported than transportation by train, lorry or plane. Tax rebates are also introduced if the investment is made in national health care, medical and infrastructure projects. Another supply which is related to loading of containers on third party vessels is very important here because this is the only supply where shipping lines have to face the brunt of suppliers. Another breakthrough in this field was implementation of Customs EDI system Electronic Data Interchange , which connected Indian customs with players in international trade electronically. We will see some of the benefits of technology which is revolutionising shipping industry. These e-business solutions has benefitted organisations by way of low costs, reduction in errors, short processing times, reusable data, real time information, less rekeying, saving of phone, fax and courier costs, secure solutions, seamless flow etc. It almost covers each and every aspect of rules and regulations required for international trade of goods and services in India.

Shipping business is based on two main core factors price and quality of service. Government has signed a memorandum of understanding MoU with Japan based on Public-Private-Partnership model to upgrade this shipyard to international level complied by standards of International Maritime Organisation.

porters five forces model pdf

In case due to the delay of service or quality become poor and at the same time the freight rates are also similar, then the customers will switch on to the new substitutes. Cost factor is primarily responsible for substitution while service specification comes secondary.

This announcement comes after months of labor negotiations and West Coast port congestion that has caused widespread shipment delays felt across the nation and across industries.

Five forces analysis logistics industry

In recent times, more encouragement is being given to new technologies which re environment friendly. Overall threat of substitutes is moderate to high. Another breakthrough in this field was implementation of Customs EDI system Electronic Data Interchange , which connected Indian customs with players in international trade electronically. In the past two decades, India has seen plethora of change, more so, as an after effect of globalisation. Although this principle of ship recycling may sound good but the working practices and environmental standards are much different than expected. Customers are also receiving web invoices and are making payments to shipping lines through online banking. It is sometimes bad because companies have to share hard earned profits with competitors and sometimes good because it gives opportunities to one company to stand in line with another in terms of quality of service, business strategy, job satisfaction etc. MSC on other hand has balance of advantages and disadvantages. Marriage is considered to be a thought for life and therefore divorce rate is extremely low in India.

Public authorities are required under the act to reply immediately or within 30 days of receiving request from any citizen which has forced them to computerising all their records for fast and easy dissemination.

Overall competition in the industry is high. Start-ups today have fresh innovative concepts and exciting working models which highlights the key socio-cultural trends in India.

Advantages of porters five forces model pdf

From view point of switching costs, buyers are not affected at all due to higher number of suppliers and freight forwarders available in market. It has reduced the paper work, operational time, costs drastically with increased data accuracy, security and management. The competitive rivalry can be summarized as follows: Number of competitors is high. Our own vessels are complemented by services with alliance partners and slot charter agreements that provide flexibility to adjust capacity and respond quickly to customer needs and new opportunities. So the government will give full support for the new entry. Maersk is the largest container operator in Kandla port but its own vessels are not operating from Kandla due to drift problem and therefore they hire the services of third party feeder vessels to load its containers till JNPT port in Mumbai, from where Maersk mother vessels are operating across continents. However inflation volatility in India was much better and stagnant compared to other countries of world. In the first year of the implementation of this act government received 42, applications of requests for information. Not all shipping lines own the vessel and therefore they hire the service of other companies, to load their containers for different destinations. Price refers to freight rate at which one container is decided by shipping company to transport from one place to another.

Bargaining Power of Buyer Buyer is one of the strongest factors in shipping line business. Inflation management therefore involve controlling demand and supply factors by various monetary and fiscal measures respectively.

Customer's ability for demand is high, because operators are in threat of losing customers.

porters five forces
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Porter’s five forces analysis on shipping industry Free Essays