Strategy - Individual Assignment With regard to the Meli Marine case (which has been illustrated in class) 1. What are the most significant factors affecting the attractiveness of the container shipping industry? Overview Macro trends affecting attractiveness of shipping industry regards 1. Overcapacity. In the next few years freight rates and margins will be challenged due to overcapacity and required investment to operate with larger ships might not be repaid. 2. Oil prices fluctuations. Government politics can affect oil prices have major impact on cost structure. In the future latest vessel with low oil consumption technology might became industry standard and could require lot of capex leading to further competitor consolidation. 3. …show more content…
Not relevant Governmental and legal barriers. Regulatory scrutiny had lowered cooperation among player Retaliation (actual or threatened). Threat of dumping in niche market by larger competitors POWER OF BUYERS – HIGH The importance of the product in the buyer’s cost structure. Not relevant Product differentiation. Not relevant The level of competition among buyers. Not relevant Size and concentration of buyers relative to suppliers. Freight forwarders and major retailers are very large customer with high level of bargaining power. In 2007 they accounted for 60% of total volume of Asia to North America trade routes. Switching cost. Very low Buyers’ information. High, not relevant Ability to integrate vertically (backward). Very low POWER OF SUPPLIERS – HIGH Ships outsourcer – limited power since they provide undifferentiated service Ships provider – High Oil supplier – High THREAT OF SUBSTITUTES – LOW Container shipping account about 90% of exported goods total volumes. Airplanes can be used but they have lower capacity and higher costs COMPETITION – HIGH Cooperation (“conferences”) had diminished putting downward pressure on prices Shipping service is undifferentiated. However Meli Marine seems to be able to offer some kind of unique customer relation service. This allows them to retain customer and prices Largest player are tempted to 2.What strategy does Meli Marine have for competing in this industry? Overview Meli Marine is the
One thing that is important to the veterinary technician that is taking the radiographs is the personal protective equipment to the tech. Being able to use all of the proper personal protective equipment (ppe) when taking x-rays will decrease the exposure of radiation to the veterinary technician. The things that a vet tech needs to wear when taking an x-ray are: lead-lined aprons, lead-lined gloves, thyroid shield, and lead glasses. I chose personal protective equipment because I feel that the ppe is the most important to the vet tech than anything else.
In the US Express Mail industry, the buyers fit into two segments: businesses and individuals. Express Mail has become the industry standard in some industries such as banking, consulting and financial services since the items inside the package had a high ratio of value to weight. Businesses needed to be able to track the packages and be assured that it arrives on time. That being said, businesses were often high-volume buyers since the shipping managers identified which firm to deal with and concentrate the high-volume of shipments to that firm for a particular project or for the time being. Sales representatives from the firms had to negotiate with stingy shipping managers who sometimes demanded the upwards of 50% or more discounts. The existence of many large volume buyers meant that the buyer power is high. Similarly, individuals also held high buyer power since the Big Three and other second-tier postal services offered largely undifferentiated services.
4) Should Ms Linn purchase the $39M capsize? Make 2 different assumptions. First, assume that Ocean Carriers is a US firm subject to 35% taxation. Second, assume that Ocean Carriers is located in Hong Kong, where owners of Hong Kong ships are not required to pay any tax on profits made overseas and are also exempted from paying any tax on profit made on cargo uplifted from Hong Kong. (75 points)
The nineteenth century introduced several great leaders into this world, many recognized by historians today. These men, Thomas Jefferson, Abraham Lincoln, and others, have all been honored and commemorated for their contributions. One such leader, José Martí, continues to remain anonymous outside the Hispanic community, and hidden in the shadows cast by these men. His name does not appear in the history books or on the tongues of many proud Americans, for he was neither a citizen of America nor an American hero.
Doctors also prescribe Selective Serotonin Reuptake Inhibitors(SSRI) to individuals suffering from depression, but the same ailment can be treated with amino acid supplements. Some examples of SSRIs are Prozac, Paxil, Zoloft and Celexa. SSRIs increase the amount of serotonin in the synapse by blocking its reabsorption, helping the symptoms of depression improve. According to the American Academy of Family Physicians, benzodiazepines lose their therapeutic anti-anxiety effect after 4 to 6 months of regular use. Dr. White, clinical psychologist and a certified neurotherapist, compares antidepressants to a foreign chemical. She is completely against the use of SSRIs because it blocks the reuptake of the serotonin into the neuron. In simple words,
Perhaps the easiest approach to the acquisition of BoatU.S. is to leave BoatU.S.’s current demand and forecast planning untouched and separate from West Marine’s planning processes. This would be inexpensive and non-disruptive to the current corporate culture. The drawbacks, however, could be a slow steady decline in profitability and reliability of the BoatU.S. brand, hence the reason for the acquisition in the first place.
Services: A host of services are provided to suit the needs to different businesses. Overnight shipping and next-morning delivery are most popular amongst other services like next-afternoon delivery and second day service. Same-day and early-next morning services are even costlier. Shipment volumes have risen over the decade
Per the case, technological developments in ship construction play a role in capacity, as newer ships are bigger, faster, and more fuel efficient, increasing the overall shipping capacity of a fleet. Accordingly the long-term decline in daily hire rates makes sense because technology
Wholesaler distributors. The current trend is the concentration in both wholesalers and retailers. In the case of USA, today the top 5 distributors control 33% of the market, and the top 10 control 45%. This high concentration supposes higher buyer power, as they buy larger volumes. In this scenario some producers have their own distributors, like Gallo. In other markets, this is also a trend, as Europe, where large firms, particularly the leading breweries, dominate the alcoholic beverage distribution. In this sense, the buyer power is high.
Porter (1980) emphasized that suppliers to an industry may be powerful if they are more concentrated than their customers and their customers do not command a significant share of their business because their customers do not represent a potential long-term or major relationship, for example, one-off or small customers versus regular or bulk buyers.
The cost of shipping goods has dropped in recent years. Part of this reduction is the result of improved efficiencies in shipping technologies. Also, tariffs on imports have dropped with the North American Free Trade Agreement and other international efforts to promote free trade this will make it easier for companies and corporations such as Nike to outsource the manufacture of their goods. [4]
Buyers are usually customers and customers if powerful have the ability to reduce prices, ask for high quality products and services. In the Indian airline industry, the bargaining power of buyers is high and is increasing as there are lots of airlines to choose from and there are hardly any switching costs. Moreover, there are lots of travel agents and customers can now buy ticket online from even intermediaries. Therefore, they do not really have to stick to one airline and this increases the power of the customers.
Another factor Service refers to fast processing of documents, bill of lading and prompt loading and movement of containers etc. It is rather difficult for customers to get better quality of service than getting competitive freight rates. In this world of technology every company is trying to adapt to new technology in their day to day businesses like e-processing of documents and fastest data entry to name a few. Maersk is so technologically advanced in this field that all its data processing is being done electronically by back office and customers are able to access all information relevant to shipment though dedicated space available on company website. Examples electronic processes are shipping bills, vessel certificates, freight invoices and bill of lading in encrypted format once the payment is done by customer either electronically or at Maersk local office. Companies like APL and MSC do have electronic processing systems but are not fully fledged and as a result much of the work is still being done manually.
Significant barriers to entry such as high regulatory and capital cost requirements and a fiercely competitive industry along with barriers to exit and the recent failure of airlines such as XL
Today, container ships are used as major transport method between countries, and most of products, which are called dry cargo such as daily products, processed food, timbers and metals, are transported by container ship.