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Container Shipping Is A Major Industry Today Commerce Essay

Container transportation is a major industry today. The past 50 old ages have seen the enlargement of transporting containers as the most of import manner of sea transporting sea cargo conveyance. These containers which are non unpacked at any point during their journey all have the same criterion design. This type of standard design allows fast and easy handling of containers at ports. The standard design besides makes the work easier for port terminuss and transportation operators.

Because container transportation services are increasing, ports have new jobs. All over the universe, port directions spend big sum of money in developing their engineering in order to manage the big figure of containers. However, containerized ports such as Ajman port have challenges with the addition in traffic and development in engineering.

The universe market is developing, so ports have to set excess attempt to last in this competitory market. Ports compete in many ways: Oceanic bearer and short sea cargo, land-based paths ( rail and truck cargo ) , transhipment clip, and speedy turnover.

The purpose of this Graduation Project is to measure larboard direction criterions and theories and compare them to the criterions used my rivals, measure the engineering used by Ajman port, construe the market state of affairs, and measure the engineering introduced by HAJT and how it will assist the company in cost decrease and effectual allotment of resources. The consequences will so be applied to the public presentation of Ajman port. Because of the strong planetary competition, it is of import that ports are effectual, well-organized and prepared with the latest engineerings. The engineering used by khalifa Port as stated in ( GULF, 2012 ) is the best illustration for latest equipment and machinery. Such engineering can let Ajman Port to serve a big figure of containerized vass. Ajman is in a good location since it is between the Eastern and the Western hemisphere. It can increase its volume of trade and net income if it can supply plenty and efficient installations for big scale operations. The research helps us to understand about the current degree of effectivity of Ajman port and gives recommendations to better its public presentation.

STATEMENT OF PROBLEM

Q: What is the impact of local economic alterations on port direction of Ajman port?

Q: What is the future analysis of Ajman port?

Q: How can Ajman Port become more competitory in the local and international Market?

The kernel of my survey will go around around these two inquiries. To farther lucubrate this construct it can be sub divided into the undermentioned inquiries.

SUB QUESTIONS

1. What are the strong and weak points of Ajman port ( Strengths and Weaknesses ) ?

2. In what country could Ajman Port invest so to better its public presentation and efficiency?

3. Make the other ports straight or indirectly affect the public presentation of Ajman port?

4. Who are the direct rivals of Ajman Port?

LITERATURE REVIEW

UAE INTERACT ( 2009 ) in their article “ Jebel Ali port voted best haven in the in-between E ” wrote that Jebel Ali port has once more been voted as the best haven in the in-between E for the 15th back-to-back twelvemonth in the AFSCA awards ( INTERACT, 2012 ) . Hong- kong based cargo intelligence Asia voted for the best acting companies in Asia conveyance and supply concatenation sector for assorted classs. The award is considered the most esteemed award for cargo and logistics services suppliers. The squad of Jebel Ali port was really much honoured having this great award. This Besides sends a message to all other ports in the middle- E that Jebel Ali port is a really tough rival so offering the best lading services to its clients all over the universe. Ajman port will hold to work really hard in order to vie with this Giant haven of UAE. The Jebel Ali port uses the latest engineering equipment to run into the demands of local and international transit ( CHAIN, 2006 ) . Therefore, Ajman port will hold to use the latest engineering every bit good in order to vie with the local and regional rivals of the GCC.

“ Jebel Ali to lend 20 per cent to Dubai ‘s economic system ” ( INTERACT, 2012 ) the writer states that Jebel Ali will lend around one fifth of Dh 300 billion economic system of Dubai. There are around 6700 companies based on the Jebel Ali free zone and employ about 170000 people. This gives an thought about the employment chances created by Jebel Ali free zone. They cater to around 12.82 % of the Dubai ‘s entire work force. About 61 % of the companies in the Jebel Ali free zone are in the machinery and equipment sector, and 18 % in the consumer goods sector. This shows that Jebel Ali has specifically targeted the machinery and equipment sector for trading activities.

METHODLOGY

My paper will look at the port direction industry in the UAE and will measure Ajman Port ‘s strengths and failings in that industry. The sort of research required for this undertaking is traveling to be qualitative research. The qualitative research will wholly be based upon the primary informations collected from the pot industry. Surveies and questionnaires will be used to garner the informations and prove the hypothesis. Iwill focal point on the concern environment of the containerized ports and I will besides measure the General Cargo terminus and warehouse installation plus how HAJT has incorporated new engineering into these systems. The RO-RO installation introduced by HAJT will besides be analysed. I will make an industry analysis utilizing Porters ‘ five forces theoretical account. Then, I will speak about the findings from the interviews that were done with Ajman Port forces. The information from the interview will assist to measure Ajman ‘s ain strengths and failings. I will so carry on a SWOT ( Strength, Weakness, Opportunities and Threats ) analysis for Ajman port utilizing the information I got from the interviews and the information on chances and menaces that I got from the literature reappraisal.

SWOT ANALYSIS

Strengths of Ajman Port

It is a portion of group of Hutchison Ajman International Terminals that has presence in more than 26 states and has 52 ports in these states.

It consists of big warehousing installations that make hive awaying big figure of containers and lading easy.

The port contains legion offices and edifices that can be rented out by agents and transporting lines doing entree easy.

There are separate ship docks for fix on the port doing it tranquil for the ship captains and crew to repair their ships and equipment.

The installation of lading consolidation and deconsolidation exist at this port.

Failings of Ajman Port:

Ajman Ports deficiency sophisticated engineering that is present on larger ports like Jebel Ali and Khorfakkan.

The client base of Ajman port is really little as compared to its rivals and in respects with its size.

Ajman port does non possess adequate forklifts or Cranes in order to pull off extra containers and lading.

Opportunities for Ajman Port:

It should capitalise more on its Free Zone undertaking that exist to supply transportation companies a 100 % revenue enhancement free environment.

The Cost decreases strategy of HAJT through debut of new equipment can be good.

With the latest tendency in Information Technology and sophisticated equipment, Ajman port can increase its efficiency by using this engineering.

There still exists a room for enlargement for Ajman Port in footings of operations and substructure.

Menaces to Ajman Port:

There are strong rivals like King Abdul Aziz Port in Dammam and the port of Jebel Ali that threaten it.

Emergence of the new Rivals such as the New port undertaking In Qatar can do a batch of jobs.

Investing made by Khalifa Port to better engineering as stated in ( GULF, 2012 ) can do a batch of jobs for Ajman port in the local market.

PORTER ‘S FIVE FORCES MODEL

The Porter five forces analysis of Jebel Ali is as follows.

EXISTING RIVALRY

Jebel Ali port has a batch of bing challengers in both the local and domestic industry. Khalifa Port of Abu Dhabi seems to be an ultimate rival for Jebel Ali in the domestic UAE market. But when looking at the overall rivals in the middle- E there exist many strong rivals such as King Abdul Aziz port ( Saudi Arabia ) , Shuwaikh Port ( Kuwait ) , Jeddah Seaport ( Saudi Arabia ) , Mina Salman Port ( Bahrain ) and Port Of Salalah ( Oman ) . All these ports are good established in their several states.

Menace OF NEW ENTRANTS

Jebel Ali haven does non confront any important menaces from the side of rivals because it is already a really established port. It has been awarded for the best port of the middle- E 15 times. And it has around 6700 companies situated on the port. And this makes it a really strong company for its rivals.

Dickering power of Suppliers

The bargaining power of the transportation companies varies from state to state. It all depends upon the figure of providers and the size of providers in the industry. As there are many ports in the UAE therefore the bargaining power of providers is higher with The Jebel Port.

Dickering Power of Customers

The bargaining power of clients is limited with regard to the Jebel Port because the port is really much established and has a batch of trade name trueness in the country of Dubai. It besides contributes 20 % of its financess to the GDP of Dubai which clearly proves that the port has a batch of influence on the economic system and on the clients.

Menaces from Substitutes

There are no important menaces for Jebel Port in the UAE except for Port Khalifa. With the beginning of commercial operations at Khalifa Port ‘s alone semi-automated container terminus, the kineticss of the port industry can alter a small. Therefore, Jemel Port will hold to be really much aware about the schemes employed by Khalifa Port. On the other manus international rivals like Jeddah Seaport, King Abdul Aziz port and the Shuwaikh Port can be possible menaces.

PORTER ‘S five forces Model.

SHUWAIKH PORT

SHUWAIKH Port Kuwait has been witnessing recent growing in the TEU ‘s over the old ages. The TEU ‘s handled have doubled since 2000 ( CHAIN, 2006 ) ( AECOM, 2012 ) . The Kuwaiti port is be aftering an investing scheme for the adjustment of future growing because they seem to hold no anxiousness about the hereafter.

Existing Competition

The Rivalry for Shuwaikh Port fundamentally resides in the international market. This is because it is the market leader in the domestic market. The Jeddah Seaport, Khalifa Port, Jemel port, King Abdul Aziz Port Salalah Port compete with Shuwaikh port In the international Market.

Menace FROM NEW ENTRANTS

The market for ports is already really saturated in the international market, but Shuwaikh port is ruling the domestic market in the port industry. Qatar is be aftering a new port Undertaking in Doha which can be a large job for Shuwaikh Port in the hereafter. ( AECOM, 2012 ) provinces, “ Specialists from AECOM ‘s industry taking planetary transit and plan direction patterns have been working with our local design professionals on this new-fangled port installation undertaking of all time since 2010. ” And this clearly depicts that Qatar is all set to come in the market with its new port Plan.

Dickering Power of SUPPLIERS

The bargaining power of providers in the Kuwait market is comparatively higher. This is because the shift costs for Shuwaikh are high in the domestic market. The figure of ports runing in Kuwait is lower as compared to other states. Therefore the Suppliers have a batch of say in the market.

Dickering Power of Customers

Looking at the TEU ‘s handled doubling in the market since 2000, it can be inferred that more and more clients prefer Shuwaikh Port for their lading and container services. Shuwaikh port has the required trade name trueness in the market so the bargaining power of the clients is non really high.

Menace From Substitutes

Menaces from replacements do n’t truly be for Shuwaikh because the company has been spread outing its operations over clip. Second Shuwaikh has a natural market for containerized merchandise imports to Iraq which are expected to increase farther with more rapid growing.

In the article by Arabian Supply Chain ( 2006 ) it is stated, “ Kuwaiti port is be aftering an investing program to excite future growing, ” which proves that Kuwaiti market is all set to spread out its operations to a higher degree.

PORTER ‘S FIVE FORCES ANALYSIS ( JEDDAH ISLAMIC SEAPORT )

JEDDAH Islamic haven is a really established sea port of Saudi Arabia and. It handles about two tierces of states entire import traffic ( CHAIN, 2006 ) . It is the largest chief port in the middle-east exterior of Dubai.

EXISTING RIVALRY

It has many local rivals. Some of the best include Dammam port and Dhuba port. The remainder of its rivals are international and competes a batch with Jebel port and Khalifa port. Shuwaikh Port is another possible rival in the middle-est.

Menace from New Entrants

There are no important menaces from new entrants in the local industry. But on the regional degree the New Port Project ( AECOM, 2012 ) of Qatar can be a large job. The latest engineering to be introduced by Port Khalifa as stated in ( GULF, 2012 ) can besides present menaces to Jeddah Seaport.

Dickering Power of Suppliers

The bargaining power of providers in the part is low because excessively many providers exist in the market is Saudi Arabia. Therefore, the Switching costs of Suppliers are expected to be low for Jeddah haven.

Dickering power of clients

The bargaining power of clients is besides really high. Customers have a batch of pick in Saudi Arabia because a batch of port companies are runing in diversified countries. Therefore the shift costs for clients are expected to be low.

Menace from Substitutes

Substitutes can non present a large menace to Jeddah haven on the local degree because the port is really much established and controls about two 3rd of state ‘s entire import traffic. Therefore the company is really much established.

PORTER ‘S FIVE FORCES ANALYSIS. ( AJMAN PORT )

The Porter ‘s five forces analysis for Ajman port is as follows

EXISTING RIVALRY

Many challengers exist for Ajman port in the UAE every bit good as the middle-east. Jebel Port and Khalifa port are the biggest rivals of Ajman. Currently they dominate the market and are in a good market place.

Menace FROM NEW ENTRANTS

There are no known new entrants be aftering to come in right now in the haven industry in UAE. But, Khalifa Port is be aftering a really heavy investing in latest province of the art engineering and is puting about $ 7.2 billion on their new undertaking. This can do a batch of competition in the local market and may ensue in heavy losingss for some rivals.

Bargaining POWERE OF SUPPLIERS

The bargaining power of Suppliers is expected to be low. This is because many ports exist in the UAE so there are many providers to provide to these ports. When the figure of providers increases their bargaining power lessenings and the clients gets an advantage in footings of pick. Ajman port has a opportunity to take best providers for their work.

BARGAINING POWER OF CUSTOMERS

Buying power of clients is expected to be high because the clients of Ajman port have a batch of other ports to take from. Therefore, Ajman port will hold to compromise on the monetary values in order to vie in this competitory environment.

Barriers TO ENTRY

The rival ports such as Jebel port and Khalifa Port use the latest engineering to provide to its clients as stated in ( GULF, 2012 ) . The engineering requires really heavy investing to come into this concern. Therefore the barriers to entry are well high. Ajman port will besides hold to put in latest engineering equipment to vie with its rival houses.

COMPETITIVE RIVALRY

There are a batch of local and international rivals for Ajman Port and the competition is really intense. The shift costs are besides really high which makes the industry highly competitory to last in. Local Rivals like Port Fujairah, Port Khalifa and Jebel Port are really good placed in the market.

COMPARISON BETWEEN DIFFERENT PORTS ACCORDING TO PORTER ‘S FIVE FORCES ANALYSIS

The comparing between different ports Tells us that the Jebel port is really much established in the UAE and the JEDDAH haven is really much established in Saudi Arabia. The Shuwaikh Port of Kuwait is besides spread outing its operations quickly, and is researching new trading options as stated in ( CHAIN, 2006 ) . The porter ‘s analysis of Ajman port looks weak as compared to some of the best ports available in the middle-east. It will hold to do many betterments in its mentality in order to vie in this intense market. The company should be ready to confront the un- awaited economic alterations and altering market kineticss over clip.

CONCUSION

The analysis tells us that Ajman port will hold to concentrate a batch on engineering, clients, location, storage capacity, providers, trading paths and Infrastructure. If the Ajman port managed to turn to these issues so it can decidedly place itself high in the market. the literature reappraisal tell us that Jebel Ali Port can move has a really unsafe rival for Ajman port in the hereafter because it is a extremely rated sea port of UAE and called by many as the gem in the crown Middle-East as stated in ( CHAIN, 2006 ) . The research thesis will concentrate on the ways Ajman port can better its place as compared to that of its rivals. How it can get the better of the failings and how it can improvize on the chances provided will besides be exhaustively addressed in the research paper.

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