• Title/Summary/Keyword: Competition structure of shipping market

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The Impact of Abolition of the Shipping Conference on the Liner Shipping Market (해운동맹의 폐지가 정기선 시장에 미치는 영향에 대한 연구)

  • Choi, Kyoung-Hoon;Kim, Hwa-Young;Kang, Ki-Jung;Kim, Sam-Youl
    • Journal of Korea Port Economic Association
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    • v.33 no.1
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    • pp.89-110
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    • 2017
  • The organization of the shipping conference -an international cartel, was approved by countries that recognized it for stabilizing routes as well as preventing excessive competition among liner shipping companies and recognized the characteristic of the liner service that is regularly repeated in the international liner shipping market. However, due to competition in bulk transportation and development of multimodal transport through new entrants, power expansion and vessel enlargement of non-aligned shipping companies; the shipping conference started collapsing, and was eventually abolished. As the shipping conference played an important role in the liner shipping market, there were changes in the competition structure of the liner shipping market, and this accordingly drove research on the effects of the abolition of the shipping conference on the liner shipping market. The effects of abolition of the shipping conference on the liner shipping market was analyzed after surveying the factors related to abolition of the shipping conference, and through the use of correlation and multiple regression analyses. Subsequent to the abolition of the shipping conference, the liner shipping companies increased global containership bottoms. Consequently, this led to fierce competition of freight charges. As a result, profitability of shipping companies diminished. However, shipping companies with a dominating cost structure recorded profits, while shipping companies with an inferior cost structure started recording a loss.

Changes in Block Exemption Applied to Maritime Transport and its Implication

  • Pak, Myong-Sop;Yoon, Yu-Ri;Hong, Ran-Ju
    • THE INTERNATIONAL COMMERCE & LAW REVIEW
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    • v.48
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    • pp.57-76
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    • 2010
  • This study reviews maritime transport policy regarding liner conference and the changes in the liner market over the decades. Liner shipping industry has long been protected from competition by block exemption. To prevent excessive competition in punctual operation and its inelastic market structure, liner shipping companies formed conferences that are protected to fix the prices under the law. In the US, deregulation in transport sector began from 80's and continuing with OSRA 1998, conferences were dissolving. On the other hand, the EU with close conference system, Regulation 4056/86 contained block exemption remained in force for unlimited time without review clause. However, in Oct 2008, the EU has announced its removal, and conferences were no longer permitted to fix the price nor exchange information. Although OSRA 1998 has already broken up conferences by allowing individual service contracts, but the repeal of the immunity for price fixing will alter significantly the rule on cooperation in the industry since it is a unilateral move by the EU, especially in transatlantic lane. There are rapid changes in shipping market getting much more complicated, and with removal of 4056/86 allowing the market to be more competitive, opening up the industry with far more diverse strategic options. Hence this paper reviews on liner shipping industry and its changes of policies over the years from protected market to open competition market of today.

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Analysis of Fleet Capacity to Enhance the Competitiveness of Container Shipping in Korea (한국 컨테이너 해운의 경쟁력 제고를 위한 선대 규모 분석)

  • Park, Sunghwa;Kim, Taeil
    • Journal of Korea Port Economic Association
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    • v.33 no.3
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    • pp.105-120
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    • 2017
  • This study analyzed changes in the competitive structure of the global shipping container market and the appropriate capacity of the container fleet in Korea from three perspectives. The competitive market analysis applied the market concentration ratio and Hirschman-Herfindahl index, while the appropriate capacity analysis was based on the following three aspects: (1) Fleet capacity to secure competitiveness in the global shipping alliance; (2) Fleet capacity to increase national fleet coverage of domestic import and export container cargo; and (3) Fleet capacity analysis through the panel model considering the characteristics of the major shipping countries. Analysis of the global shipping container market reveals an oligopoly industry, and Korea's container fleet capacity is insufficient across all three analyses.

The Effects of Logistics Competence in Korea Overseas Shipping Industry (국제해상운송업의 물류경쟁력 영향요인)

  • 박영근;공덕암
    • Journal of Korea Port Economic Association
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    • v.21 no.1
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    • pp.45-58
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    • 2005
  • The purpose of this study is to consider the problem on pursuit of logistics strategy by our international shipping company in international shipping business under the said circumstance due to the open international shipping market and to suggest the logistics strategy for the consideration of the logistics competition under new international shipping circumstances. The results of empirical analysis are mentioned as follows; First, it shall be considered to maintain the size of company bigger than a certain capability so that it may obtain the superior competition of logistics. Second, as there are the plus correlations between the competition of logistics and the logistic support, it is necessary to pursuit the upgrade service with using EDI system and making up the complex shipping and integrated logistics system in general. Third, with the rationalization of finance policy and the profitable management of shipping company the ratio of net worth can be raised and it can be achieved to make the sound financial structure as reducing the excessive debt ratio. Fourth, it can be effort continuously to perform the investment for the infrastructure of logistics support & the institutional supplement so that it may achieve to increase the efficiency of logistic support at pier and to reduce the cost of logistic support.

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A study on competition of hinterland in Zhejiang Province between Shanghai Port and Ningbo Port

  • Li, Jia-Bin;Lee, Su-Ho
    • Journal of Navigation and Port Research
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    • v.34 no.7
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    • pp.567-575
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    • 2010
  • Ningbo Port develops quickly in recent years and with the combination of Ningbo Port and Zhoushan Port, it becomes another important port in the Shanghai International Shipping center. Competition between the two biggest ports in this area can't be avoided. The goal of this paper is investigating the competence of port from two angles, which are spatial structure of the ports cluster and neighboring ports' attraction to cargoes at conjunct hinterlands. The paper firstly uses the HHI index model and shift-share method to qualitatively and quantitatively analyze the data of container throughputs of ports in the shipping center, in order that investigates the spatial structure of ports cluster. Basing on above researches, the paper employs the location quotient to study Shanghai port and Ningbo port's hinterland distributions at Zhejiang province. The conclusion of this study:(I)the ports cluster of the Shanghai International Shipping Center is highly centralized, and undergoes a porcess of first centralization then decentralization since the mid of 90s, last century. (2)Hinterlands of Shanghai port includes: Hangzhou, Jiaxing, Huzhou and Quzhou districts; Hinterlands of Ningbo port includes: Ningbo, Taizhou and Zhoushan districts.

A Study on the Situation Analysis for Competitive Advantage Power of Korean Shipping Industry (우리나라 해운산업의 경쟁력 실태분석)

  • 이학헌;민성규
    • Journal of the Korean Institute of Navigation
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    • v.19 no.3
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    • pp.35-65
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    • 1995
  • The development of Korean shipping industry is maybe defined into three development stages-industry fixing stage, industry coordinating stage, industry development stage-. The development of shipping industry has been depended on the geovernment/authority role such as shipping policy, system, law, rules and regulations. In 1983, Korean shipping industry reorganization and coordination by shipping authority have made our shipping industry on the stable condition together with each company's efforts. Today's world economic environment such WTO/UR negotiation results get this government role limited. According to the being reduced government role, each company's competitive advantage power becomes more important. Besides, korean shipping industry is exposed into the entire and bitter world competition. In order to win and prevent the world shipping competition, it is necessary to look out the competitive advantage power of Korean shipping industry. The first purpose of this study is the situation analysis for competitive advantage power of Korean shipping industry. The second is to compare with our shipping policies with foreign ones concerned with ship, cargo, crew, tax and others. But in order to compare with foreign shipping, this study need their shipping statistics data, this study has some limit of the foreign data. This study has been carried on the basis of the following items. 1. Shipping environment, 2. Ships and ship acquirement(shipbuilding/purchasing), 3. Oceangoing cargo and ship's stowage rate, 4. Human factor in shipping-crew, 5. The incomes and costs in finacial statements. We have some conclusions as following through the this study. First, Korean shipping industry environment-competitive disadvantage situation- has changed rapidly due to the shipping market opening, free market entering of foreign shipping. Second, Korean shipping is disadvantageous due to the high tax rate and financing conditions in connection with ship acquirement. In order to improve the competitive advantage power, the shipping tax system and ship financing conditions should be reviewed to profitable for owners. Third, but both world and Korean oceangoing cargoes quantity have been increased annualy, Korean ship's cargo stowage rate is being decreased. This is serious situation but Korean shipping take well use of foreign vessel with hire. It is recommended to take use of owner's vessel and hired ones in the long range view, considering the world shipping management. But the number of crew has been decreased by 2, 000~3, 000 annualy, it is desirable that the long sea-experienced crew have been increased. Almost of owners usauly complain the crew cost is the main obstacles to competitive advantage power. Human factor is the most important firm's asset. All owners should pay attention to this though, and invest the proper budget to training, education, welfare as much as possible. In the long run this effects could be feedback to owners. Fifth, We must improve the financial statements structure, that is, the first step is to increase income, the second is to decrease cost, the third is to increase income on the same cost, the fourth is to decrease cost on the same income. It is essential to find out what the urgent investment is and what unnecessary cost is. At last, in order to competite world shipping race, each shipping firm must try for himself to retain the power. The government/authority is no longer dependable. I believe that each firm's power will be the industry's power, the industry's power will be the nations's power.

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A Study on International Competitiveness Analysis of Korean Ship Management Service (한국 선박관리업의 국제경쟁력 실태분석에 관한 연구)

  • Cho, Kyu-Seong;Ahn, Ki-Meong;Shin, Yong-John
    • Journal of Navigation and Port Research
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    • v.27 no.1
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    • pp.9-18
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    • 2003
  • This is a study for international competitiveness analysis if korea ship management service using the collected data from the fields in industry. making a comparison if ship management company between domestic ones in Korea and mutinational ones in international market is more suitable for it's purpose. but competitiveness level of korean ship management companies are too low to compare. Therefore in this study, ship management devision in Korea overseas shipping companies are selected as a target of camparision and the representative of Korea ship management industry. The analysis of competitiveness is divided by price competition and non-price competition. The former is consist of element likes as crew management cost, dry-docking cost, repair cos, stores & spares cost, lubricants cost and management free cost, The later os consist of element like as quality of sea & shore personnel, efficiency of company's organization, ability of management system. qualifications & certifications, know -hoe for the ship management, structure of control & support ship and office automation & IT system. According to this analysis the ship management division in korean shipping companied are superior to the foreign specialized ship management companies generally. So, it is necessary that korea ship management industry attempt level-up continously and expand into international ship management market positively.

A Study on the Performance Comparison of Container Terminal Operators in Busan Port and Shanghai Port (부산항과 상하이항 컨테이너 터미널 운영사의 경영성과 비교에 관한 연구)

  • Kim, AA-Rom;Ryoo, Dong-Keun
    • Journal of Navigation and Port Research
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    • v.40 no.3
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    • pp.139-146
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    • 2016
  • Due to the continuous increasement of the container cargoes, each container port market has been growing as well. Moreover, the competition among container terminal operators located in the same port is also growing in order to attract more container cargoes. This paper looked into the market structures, market conducts and market performances of container ports in Busan and Shanghai. The index which has been most widely used to measure market structure, the Hirschman-Herfindahl Index (HHI), is computed by squaring each supplier's market share, then adding the squared shares. This paper estimated the market performance as profitability (PCM, ROA), growth (total TEU, rate of the increasement of TEU) and examined the effects of the HHI on the profitability and growth in a container terminal operators in Korea and China. The major findings of this study is that the market structure has effects on market performance in Busan port (total TEU) and Shanghai port (PCM, ROA and total TEU). As a result of analysing this study, market structure has an effect on market performance in Busan and Shanghai port, but the power of influence can be changed by market concentration index and various market conduct of companies.

International Success the Second Time Around: A Case Study (제이륜국제성공(第二轮国际成功): 일개안례연구(一个案例研究))

  • Colley, Mary Catherine;Gatlin, Brandie
    • Journal of Global Scholars of Marketing Science
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    • v.20 no.2
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    • pp.173-178
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    • 2010
  • A privately held, third generation family owned company, Boom Technologies, Inc. (BTI), a provider of products and services to the electric utility, telecommunications and contractor markets, continues to make progress in exporting. Although export sales only equaled 5% of total revenue in 2008, BTI has an entire export division. Their export division's Managing Director reveals the trial and errors of a privately held company and their quest for success overseas. From its inception, BTI has always believed its greatest asset is its employees. When export sales struggled due to lack of strategy and direction, BTI hired a Managing Director for its export division. With leadership and guidance from BTI's president and from the Managing Director, they utilized the department's skills and knowledge. Structural changes were made to expand their market presence abroad and increase export sales. As a result, export sales increased four-fold, area managers in new countries were added and distribution networks were successfully cultivated. At times, revenue generation was difficult to determine due to the structure of the company. Therefore, in 1996, the export division was restructured as a limited liability company. This allowed the company to improve the tracking of revenue and expenses. Originally, 80% of BTI's export sales came from two countries; therefore, the initial approach to selling overseas was not reaching their anticipated goals of expanding their foreign market presence. However, changes were made and now the company manages the details of selling to over 80 countries. There were three major export expansion challenges noted by the Managing Director: 1. Product and Shipping - The major obstacle for BTI was product assembly. Originally, the majority of the product was assembled in the United States, which increased shipping and packaging costs. With so many parts specified in the order, many times the order would arrive with parts missing. The missing parts could equate to tens of thousands of dollars. Shipping these missing parts separately in another shipment also cost tens of thousands of dollar, plus a delivery delay time of six to eight weeks; all of which came out of the BTI's pockets. 2. Product Adaptation - Safety and product standards varied widely for each of the 80 countries to which BTI exported. Weights, special licenses, product specification requirements, measurement systems, and truck stability can all differ from country to country and can serve as a type of barrier to entry, making it difficult to adapt products accordingly. Technical and safety standards are barriers that serve as a type of protection for the local industry and can stand in the way of successfully pursuing foreign markets. 3. Marketing Challenges - The importance of distribution creates many challenges for BTI as they attempt to determine how each country prefers to operate with regard to their distribution systems. Some countries have competition from a small competitor that only produces one competing product; whereas BTI manufactures over 100 products. Marketing material is another concern for BTI as they attempt to push marketing costs to the distributors. Adapting the marketing material can be costly in terms of translation and cultural differences. In addition, the size of paper in the United States differs from those in some countries, causing many problems when attempting to copy the same layout and With distribution being one of several challenges for BTI, the company claims their distribution network is one of their competitive advantages, as the location and names of their distributors are not revealed. In addition, BTI rotates two offerings yearly: training to their distributors one year and then the next is a distributor's meeting. With a focus on product and shipping, product adaptation, and marketing challenges, the intricacies of selling overseas takes time and patience. Another competitive advantage noted is BTI's cradle to grave strategy, where they follow the product from sale to its final resting place, whether the truck is leased or purchased new or used. They also offer service and maintenance plans with a detailed cost analysis provided to the company prior to purchasing or leasing the product. Expanding abroad will always create challenges for a company. As the Managing Director stated, "If you don't have patience (in the export business), you better do something else." Knowing how to adapt quickly provides BTI with the skills necessary to adjust to the changing needs of each country and its own unique challenges, allowing them to remain competitive.

Spatial Structure of Hinterlands and Forelands of Pusan Container Export Port: the Cases of 3 National Flag Carriers (부산 컨테이너 수출항의 배후지와 지향지의 공간구조)

  • Cho, Su-Kyung
    • Journal of the Korean Geographical Society
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    • v.28 no.3
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    • pp.247-267
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    • 1993
  • According to developing international economy since the World War II, the increase and competition of the national business is so empha-sized tht both the interest and the necessity about marine transportation playing the impor-thant role of international transportation are increased. Today, the container transportation, as called the innovation of marine transport has been prevailed since the 1970's. The purpose of this paper is to grasp the spatial structure of the hinterlands and forelands, its object is export container cargo at Pusan Export Port, as known for the transportation node of modern containerlization. In this study, for the purpose of grasping the relation between hinterlands and forelands of Korean export container cargo, first, I researched the transition of carloading about container cargo, the bistribution channel of cargo, the change of the items of container and the carlo-adings about transport route, secondly, I used the cluster analysis so as to group hinterlands according to the items of goods and forelands. The object of the analysis is container cargo of Choyang Line, Hanjin Shipping and Hyundai Merchant Marine of National Frag Carriers. The source materials used in this study are Trucking Data of Hanjin Co., Container Ren-tal Data of Samik Transport Co. and Transpor-ting Present Condition Tables of Hyundai Mer-chant Marine. 1. There are two kinds of the transport classi-fied by its form: FCL and LCL. In Pusan Con-tainer Export, a lot of textile goods, clothings and furniture, compound, electric goods, and so on are dealed with but the rate of occupation of the transport is getting lower while that of occupation of equipment, papers and agricultu-ral, mineral and livestock industry higher. 2. In 1990, the transports of container cargo in Korea consist of 7 services and round-the world lines. We can list North America lines, East-South Asian lines, Japan lines and Inter European lines, in order of the quantity of tran-sport form the largest to the smaller. We can have another list that Japan lines, North Ame-rica lines and East-South lines in order of the rate participation of national flag carriers, be-cacuse Korean foreign trade lay disproportionate emphasis on East-South Asian lines. Japan lines among them is the biggest import-export market. Since the rationlization policy of marine tran-sport in 1984, each of national flag carriers have its own lines. Hanjin Shipping predominates over North America lines, Choyang Line over New Zealand, Inter European and Austria lines and Hyundai Merchant Marine over Center-South America lines, in terms of the volume of transport. And small-to-medium sized shippers are prevailing in lines which are adjacent to Korea, Such as Japan lines and East-South Asian lines. 3. In relation to hinterlands and forelands of Choyang Line, the light industry goods, electric goods and machinary produced in Seoul and Pusan are exported to the major ports in Europe and Japan, the same produces in Suwon, Ulsan, Kumi are exported to European Ports, and those in Incheon and Kwangju Austrian and Japanese ports, and those in the rest regions to the major port in Japan. 4. In relation to hinterlands and forelands of Hanjin Shipping, the light industry goods pro-ducing in Seoul and Pusan, the electric goods and machinary in Incheon and Pyeongteck, are exported to New York and Los Angeles. Electric goods and machinary Masan, Anyang, Cheona, Cheongju and Incheon, Electric goods machinary and light industry goods in Kwangju and non mental goods in Pohang, are exported New York, Los Angeles and Oakland. 5. In relation to hinterlands and forelands of Hyundai Merchant Marine, the region of Seoul, Pusan and Incheon closely related with the main ports in U.S.A. The rest regions with Montreal. The hinterlands of export container cargo can be classified by its export items into three kinds: the large city, industrial city and the rest city. Choyang Line's forelands are European lines, Japan lines and Austria lines, and Hanjin Shipping's forelands are North America lines, and Hyundai Merchant Marine's forelands are North America lines and Japan line. 3 National flag carriers' major forelands are determined by the size of port and the shipper's convenient use of the port terminal.

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