Business Strategy in Post-crisis=20 Era
At the forum of shipping and = logistics=20 development on January 28th, experts and scholars of economy, shipping = and=20 logistics sectors discussed the business strategy in the era after the=20 devastating financial crisis.
Sun Jiakang, General Manager of =
COSCO=20
Container Line Co., Ltd. (COSCON) gives his pertinent comment, =
According to Mr. Sun, in the = post-crisis=20 era, shipping companies should adopt the following policies and=20 strategies:
Cooperation for win-win effect: = on one hand=20 the relationship among shipping companies will be closer. By = strengthening=20 cooperation, we can realize scale effect and mutual supplementation of = resource,=20 cut down operation risks and costs, improve route layout and explore new = market.=20 On the other hand, shipping companies should enhance collaboration with=20 suppliers including strategic partnership with fuel oil, port and land = haulage=20 service providers to play a =A1=B0positive-sum game=A1=B1.
Risk prevention: shipping = companies should=20 cautiously control the risk of overspeed of fleet expansion. Although = the=20 international shipping market will continue the trend of recovery with = solid=20 foundation, liner operators should be rational in operation and control = of=20 carrying capacity so as to cultivate a good environment for resurrection = of=20 liner market and increase of business revenue. Besides that, shipping = companies=20 should try the best to guarantee security of capital chain by tighter = credit=20 monitoring, prevention of potential risks and all kinds of financial = risks in=20 capital management and in the meantime positive exploration of financing = channels.
Cost control: by concept of cost = efficiency,=20 shipping companies should put emphasis on their systematic management = and=20 control of costs in operation practice so that consciousness of cost = control=20 could be part of enterprise culture and deeply rooted in routine work of = all=20 employees. It will still be a =A1=B0Golden Mean=A1=B1 to adjust and cut = down costs in 2010=20 under changeable market conditions.
Slow speed and emission = reduction: as=20 customary practice many liner companies announced to slow down the = service speed=20 of vessels to reduce carbon emission. We will probably to see more = vessels and=20 routes of lower service speed, e.g. expanded from current Far = East/Europe/Med=20 lines to other trade lines.
Improvement of comprehensive = transport=20 capability: facing the cutthroat competition in 2010, liner companies = must=20 provide better service to get more revenue. As the cargo source of = hinterland=20 areas swells up, liner companies will pay more attention to the = improvement of=20 combined transport.
Promotion of freight rate = recovery: with the=20 V-shaped tendency of world economy plus effective control of carrying = capacity=20 by liner operators, the freight rates of almost all the shipping routes = had=20 recovered more or less in the second half of 2009 but it still has a = long way to=20 go in 2010.
Development of emerging market = and domestic=20 trade market: we should try to grasp the opportunities on the new and = emerging=20 markets especially in Middle East, India, Brazil and Southeast = Asia.
Cai Guorong, a Chinese logistics = expert=20 summarizes the countermeasures of freight forwarders against industry = downturn=20 by four C-words, =A1=B0Confidence, Creation, Communication and=20 Cooperation=A1=B1.
At present, the freight = forwarding=20 enterprises should sharpen their competitive edge in the following=20 aspects:
Confidence consolidation: = confidence is=20 rooted in healthy financial status and teamwork spirit.
Cooperation strengthening: under = the=20 prerequisites of =A1=B0Honest, Standard, Supplementary and = Win-win=A1=B1, cooperation may=20 be carried forward sequentially from small to big, local to whole and = business=20 to assets.
Interior power: versatile = methods may be=20 applied like learning, training, summarizing, retrospection, position = exchange,=20 soliciting customer's opinions, seeking for exterior assistance, = etc.
Upgrading and mode conversion: = under the=20 market pressure, all freight forwarders must change their business modes = according to individual scales and characteristics, e.g. converted to = integrated=20 logistics enterprises, supply chain alliance, specialized subcontractor, = focus=20 on new markets in Africa, South America and Middle East as well as = China=A1=AFs=20 import market, etc.
But of course there are some = negative tunes=20 where Hua Min, Director of World Economy Research Institute of Fudan = University=20 utters some sensational voice like,
China Invests CNY1.8 Billion in = Harnessing=20 Yangtze River Fairway
In 2010, the Chinese Government = will invest=20 CNY1.8 billion in harnessing the shallow waters in the middle and lower = reaches=20 of the Yangtze River.
The fairway authorities will = dredge the=20 fairways of Anqing and renovate the terminals of Yibin, Yichang, Yueyang = and=20 Wuhan as well as acceptance check the digital channel of Nanliu section = and the=20 first-phase IT project. Meanwhile, the authorities will improve the = construction=20 and development planning of Yangtze River fairways in the twelfth = five-year plan=20 (2011-2015) with focus on harness of Yinbin-Shuifu section in the upper = reach,=20 key channels like Jinjiang River in the middle reach and some dangerous = shallow=20 waters or hinders to navigation in the lower reach.
It is estimated that till the = end of 2010,=20 1,000DWT ships may sail directly to Yibin; 5,000DWT ships may sail = upstream to=20 Anqing throughout the year and to Yichang in certain seasons; 8,000DWT = ships may=20 sail seasonally to Wuhai while 50,000DWT sea vessels can arrive at = Taicang Port=20 throughout the year and seasonally to Nanjing. After the harnessing and=20 optimizing of navigable waters, the potentials of Yangtze River have = been=20 greatly released.
Bao Steel and CSSC Sign = Strategic=20 Cooperation Agreement
Bao Steel Group and China State = Shipbuilding=20 Corporation signed strategic cooperation agreement on January = 1st.
According to the agreement, CSSC = will give=20 priority to Bao Steel in selection of steel plate while Bao Steel offers = priority to steel supply. Both parties will jointly develop supply chain = to=20 deepen cooperation and avoid market risks. Bao Steel will actively = assist CSSC=20 in r&d, manufacturing and supply of new business sectors like oil = tankers=20 above 250,000DWTs, offshore drilling platform, etc.; both party will = perform=20 strategic cooperation at a more profound level with better service and = more=20 stable cost to consolidate their respective advantageous position in the = industry chain.