Program Studi Transportasi Laut dan Logistik

Jurusan Teknik Perkapalan

Fakultas Teknologi Kelautan

INSTITUT TEKNOLOGI SEPULUH NOPEMBER

PORT COMPETITION
Oleh:

Firmanto Hadi
Murdjito

Port Competition
PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Main

factors determine port competition:

The Rivalry among Existing Competitors

The Threat of New Competitors
The Potential for Global Substitutes
The Bargaining Power of Port Users
The Bargaining Power of Port Service Providers

Jumat 23 Desember 2016

Rivalry among Existing

Competitors
PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Hinterland Market Access

Ability to Service Transshipment Trade
Regional Port Capacity and Demand
Ability to Create Competition within the Port
Stakes at Risk
Ability to Absorb Losses
Ability to Control Operations
Limits on Rivalry within Ports
Government Willingness to Subsidize Operations

Jumat 23 Desember 2016

Threat of New Competitors

PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Capital

Expenditure for New Port Facilities

New Distribution Patterns
Provisions in Operating Agreements
Natural Barriers
Magnitude of Switching Costs
Cost Advantages and Customer Loyalties

Jumat 23 Desember 2016

Potential for Global Substitutes

PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Other

global sources for products moving

through the port
Substitute product for exports and imports
Magnitude of Switching Costs for Substitution
Demand elasticity of exports and imports
Importance of port costs in total delivered
price

Jumat 23 Desember 2016

Bargaining Power of Port Users

PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Concentration

of port user power

Impact of changing business relationship
Presence of large value-adding tenants
Importance of port to the economy
Ability to replicate port services
Facility investment by port users

Jumat 23 Desember 2016

Bargaining Power of Service

Providers
PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Experience

and capabilities of service

providers
Participation in facility financing
Choke points in the port
Ability to absorb downtime
Interrelationships between providers and port
users
Rights and obligations conveyed by
contractual agreements
Jumat 23 Desember 2016

Port Management Structure and

Ownership Models
PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

A number

of factors influence the way ports

are organized, structured and managed,
including:
The socioeconomic structure of a country
Historical developments (for example, former
colonial regions)
Location of the port (urban or in isolated regions)
Types of cargoes handled (liquid and dry bulk,
general cargoes, or containers)

Jumat 23 Desember 2016

Port Management Structure and

Ownership Models
PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

From four main categories, the port can be classified into

four main models:

Public service port

Tool port
Landlord port
Fully privatized port

These models are distinguished by how the differ with

respect for such characteristics:
Public, private, or mixed provision of service
Local, regional or global orientation
Ownership of infrastructure (including port land)
Ownership of superstructure and equipment (particularly ship-toshore handling equipment, sheds and warehouses)
Status of dock labor and management

Jumat 23 Desember 2016

Public Service Port

PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Mainly focus on the realization of public interest

The number of service ports is declining
The port owns, maintain, and operates every
available assets
Usually controlled by the ministry of transport
Among the main function of a service port are cargo
handling activities
Strength:

Superstructure development and cargo handling

operation are the responsibility of the same organization
(unity command)
Jumat 23 Desember 2016

10

Public Service Port

PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Weaknesses:
There is no role or only a limited role for the private sector in cargo
handling operations
There is less problem solving capability and flexibility in case of labor
problems, since the port administration also is the major employer or
port labor
There is lack of internal competition, leading to inefficiency
Wasteful use of resources and underinvestment as a result of
government interference and dependence on government budget
Operations are not user or market oriented
Lack of innovation
No or limited access to public funds for basic infrastructure

Jumat 23 Desember 2016

11

Tool Port
PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

As a service port, tool port mainly focus on the

realization of public interest
The port authority owns, develops, and maintain the
port infrastructure as well as the superstructure
such as quay cranes and forklift trucks.
Port authority staff usually operates all equipment
owned by the port authority
Other cargo handling on board as well as on the
apron and the quay is usually carried out by private
cargo handling firms contracted by shipping agents

Jumat 23 Desember 2016

12

Tool Port
PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Strength:
Investment in port infrastructure and equipment (particularly
ship/shore equipment) are decided and provided by the public sector,
thus avoiding duplication of facilities

Weaknesses:
The port administration and private enterprises jointly share the
cargo handling services (split operation), leading to conflicting
situations
Private operators do not own major equipment, therefore they tend to
function as labor pools and do not develop into firms with strong
balance sheets. This causes instability and limits future expansion of
their companies
Risk of underinvestment
Lack of innovation

Jumat 23 Desember 2016

13

Landlord Port
PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Landlord ports have a mixed character and aim to strike a

balance between public (port authority) and private (port
industry) interest
Port authority acts as regulatory body and as landlord, while
port operations (especially cargo handling) are carried out by
private companies
Infrastructure is leased to private operating companies or to
industries
The lease to be paid to the port authority is usually a fixed
sum per square meter per year.
The private port operators provide and maintain their own
superstructures including building and also purchase and
install their equipment
Dock labor is employed by private terminal operators,
although in some ports provide by labor pool system

Jumat 23 Desember 2016

14

Landlord Port
PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Strengths:
A single entity (the private sector) executes cargo
handling operations and owns and operates cargo
handling equipment. The terminal operators are more
loyal to the port and more likely to make needed
investment as a consequence of their long-term contracts
Private terminal handling companies generally are better
able to cope with market requirements

Weaknesses:
Risk of overcapacity as a result of pressure from various
private operators
Risk of misjudging the proper timing of capacity additions

Jumat 23 Desember 2016

15

Full Privatized Port

PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Focus

on private (shareholder) interests

The state no longer has any meaningful
involvement or public policy interest in the
port sector
Port land is privately owned

Jumat 23 Desember 2016

16

Full Privatized Port

PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Strengths:
Maximum flexibility with respect to investment and port
operations
No direct government interference
Ownership of port land enables market-oriented port
development and tariff policies
In case of redevelopment, private operator probably
realizes a high price for the sale of port land
The often strategic location of port land may enable the
private operator to broaden its scope of activities

Jumat 23 Desember 2016

17

Full Privatized Port

PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Weaknesses:

Government may need to create a port regulator

to control monopolistic behavior
The government loses its ability to execute a
long-term economic development policy with
respect to the port business
In case the necessity arises to redevelop the port
are, government has to spend considerable
amounts of money to buy back the port land
There is a serious risk of speculation with port
land by private owners
Jumat 23 Desember 2016

18

PROGRAM STUDI TRANSPORTASI LAUT DAN LOGISTIK TEKNIK PERKAPALAN

Jumat 23 Desember 2016

19