An important driver to the shipping business is
competition. As in any competitive
business segment, the competing players bring about pressure on pricing, raise service standards and offer incentives that are hard to match in the short run. The competitors continuously push the business dynamism to edges by their short term and long term marketing and sales strategies.
The nature of 'competition' as a phenomenon is to remain changing in perspective continuously. So when players perceive competitive landscape as changing, they tend to change their service, sales, marketing, pricing and advertising strategies continuously. While this does not necessarily mean that the end users get best services for their money, it certainly causes the entire industry to experience a certain dynamism moving forward.
There will be situations when competition appears to be low and some sort of cartelization or syndication gradually taking shape. This could happen until regulatory forces start to play and some sort of self regulation also occurs. Now the competition again resurfaces and industry once again feels free market dynamism returning to its door step.
It is interesting to observe that shipping industry also has a cartel type price syndication known as shipping conferences, formed regionally. The goal of these conferences is to 'stabilize' freight rates and ward off any potential downward price pressures from large Multi-National Corporations s trying gain a foot hold in an otherwise 'local' market.
business segment, the competing players bring about pressure on pricing, raise service standards and offer incentives that are hard to match in the short run. The competitors continuously push the business dynamism to edges by their short term and long term marketing and sales strategies.
The nature of 'competition' as a phenomenon is to remain changing in perspective continuously. So when players perceive competitive landscape as changing, they tend to change their service, sales, marketing, pricing and advertising strategies continuously. While this does not necessarily mean that the end users get best services for their money, it certainly causes the entire industry to experience a certain dynamism moving forward.
There will be situations when competition appears to be low and some sort of cartelization or syndication gradually taking shape. This could happen until regulatory forces start to play and some sort of self regulation also occurs. Now the competition again resurfaces and industry once again feels free market dynamism returning to its door step.
It is interesting to observe that shipping industry also has a cartel type price syndication known as shipping conferences, formed regionally. The goal of these conferences is to 'stabilize' freight rates and ward off any potential downward price pressures from large Multi-National Corporations s trying gain a foot hold in an otherwise 'local' market.
