DANAOS CORPORATION SWOTANALYSISSWOT analysis or elsethe strategic tool meaning strength, weakness, opportunities and threats usedby top managers to organize and plan any kind of company. To be more specific,Danaos Shipping Corporation uses all along the SWOT analysis as a technique toevaluate the financial year passed, as well as setting new goals.
Needless tosay that Danaos as a company is one of the best leading organizations inshipping, having the preferred place at SWOT, renewing the process and creatingbusiness plans within diversed departments in such company. The obligatory onesthat need to be mentioned are the marketing, finance, operations, managementinformation systems and strategic planning. SWOT analysis’ context actuallyfocuses on the internal and external strategic factors. These kinds of factorsare divided into two categories each.
Thus, the internal strategic factors havetheir strengths and weaknesses, as well as the external strategic ones containopportunities and threats. To sum up, the above suggestions have conjured theSWOT analysis. Its purpose is to combine those four and be the best of all,alienating all competitors by specific strategies. Danaos shipping companybuilds and enhances strengths, resolves and reduces weaknesses, exploits andexpands opportunities and, finally, avoids and thwarts threats. STRENGTHS OF DANAOS CORPORATION-INTERNAL STRATEGIC FACTORS Danaos shippingcorporation varies quite the strengths, which allows it to expand in its andnew markets. Contradictionally, it has shown that over the years it can boostits own share market and at the same time explore and infiltrate other ones.Beginning with the strengths, representatives and distributors of Danaos showan important support to company’s products, investing on them in a way, inwhich every client can get astonished in the presentation and, also, staysatisfied beyond expectations.
Remarkable to mention that this corporationwishes to extract the best of itself, thus it gives great importance to thetraining of employees in the sales section. Financially speaking, the globalmarket shows huge competition among shipping industry and Danaos has achievedto come out of its shell with the automation of its activities. Therefore, thecompany has brought cohesion in the quality of products coming, degradingcompetition in the market. Furthermore, this coherence has already led to goodreturns on capital expenditure and has built new revenue steams and sufficientfree cash flow.
Besides, Danaos has shown a good face in novelty anddevelopment, which make them trustworthy to carry out any kind of projectupcoming. Moreover, it is widely known that Danaos has built a strong anddependable personnel and specifically its suppliers who exceed supplycongestions via the distribution network they have contrived to manage. Thepast years, Danaos has gained onsistent clients in containers, such as China Shipping, CMA-CGM, Hanjin,HMM, Maersk, MISC, TCC, Yang Ming, UASC, Wan Hai, and Zim Integrated ShippingServices. Lastly, it has made agreements for ten to twelve years with CMA-CGM,Yang Ming in time charter and two other accredited charterers for 19 contractedvessels and 18-year bareboat charters with an accredited charterer for itsother contracted vessels. WEAKNESS OF DANAOS CORPORATION-INTERNAL STRATEGIC FACTORS SWOT analysis canenable Danaos to overcome its problems or anything holding them back and createa schedule or else a strategy, which can improve its skills. Bad news have beenalready announced for Danaos corporation with the profitability ratio and netcontribution % being disputed, as it has reached a number aspiration. Furthermore,Danaos’ products have faced problems against competitors’ ones. An intenseconcern has been created, while its products are quite well and wanted, but atthe same time the sales position-proposition is not quite clear and determined.
Danaos Corporation is a prosperous company and has accomplished a great levelof conflation of small firms. Although, this case does not comply with themerging of companies with different culture. Additionally, one of Danaos’strong motos is Research and Development, and as we mentioned above it has alreadybuilt a developed training section, however not fully-advanced and able to becompared with other successful shipping firms. Danaos Corporation is not yetfully-integrated to compete with the best in the industry, as its corrosion inthe work force the past years does not let the employees raise their skills withineducational means, so as to work up new technological products. Last but notleast, the company has not shown up to recent times that it handles theirfinances the proper and yielding way. Current asset and liquid asset ratiosprove Danaos’ liquidity need to be spent more profitably. OPPORTUNITIES FOR DANAOS CORPORATION-EXTERNAL STRATEGIC FACTORS A wide road opens forfinancial recession and augmentation of customers following with bigger marketshare, due to chronic elaboration in the shipping industry. Likewise, newsurfacing comer market has been created with the signing of the governmentalfree trade agreement.
Forecasting for great profit says that according to newlow taxation and inflation rate, incoming business activities could be plannedwith the market stabilization and the reduction of interest rate. Latestresearch of the GE healthcare has discovered the finest of oil drillingmachines, leading to new abilities in the manufacture of products in different,but not dissimilar, sections. And as we talk solutions, one of the best forattraction of new clients is within advanced products ahead of time, sincetoday we are provided with the best revolutionary technological means.
Thus,debilitation of market’s advantage leads to increased competitiveness. THREATS DANAOS CORPORATION FACING-EXTERNAL STRATEGIC FACTORS Rare but not impossible to happen that even a slight change in the demandof highly profitable products will affect the company’s economy in theshort-term or long term financial period. As consumption concerns, a possiblethreat for Danaos Corporation could be the imitation of low-grade quality ofproducts among broader markets, along with the change in consumer’s behaviorvia online purchase towards the existing model of purveyance in materialproducts. Moreover, unstable political vibes and probabilities of Americanisolation trends trouble the government about the number of markets throughexchange rate fluctuations globally. In case of increased raw material, wageraise and, especially in risen prices, for instance the 15$ price in China, seriouspressure in the profitability of the company will be caused. Ultimately, thenew environmental rules under Paris agreement (2016) can lead to similarreaction in various product and field categories.
Zodiac Maritime, Seaspan Corporation, andCostamare are the basic shipping competitors in containerships. LIMITATIONSOF SWOT ANALYSIS FOR DANAOS CORPORATION Significant limitations areused in the SWOT analysis, despite its wider utilization as a strategic planningtool. Some of those limitations are the following.
Specifically, in case of anychange in the environmental regulations, the one and only way not to beconsidered as a threat for Danaos Corporation is to capitalize of the situationfor its advantage. To wit, it can examine the occurrence and producecommodities suitable and sooner than the competitors’, assuming, of course,that this alteration play in equal or, at any case, favorable for Danaos limitsof rivalry. In the SWOT matrix, are executed proposed tactics, in whichassessment window is given, while it should have been based upon animplementation plan of any competitiveness of Danaos Corporation. Remarkable tomention that the latinic term of status quo, meaning statistic evaluation,provides future modifications, such as circumstances, capabilities, threats andstrategies change and the dynamics of competitive environment.
During theconfiguration of strategies, internal or, and, external factors interact.Nevertheless, SWOT’s matrix does not point on those or on the discretion ofexpediency success towards competitors’.WEIGHTEDSWOT ANALYSIS OF DANAOS CORPORATION According to the above, for thatameliorative limitations of SWOT analysis-matrix, the company’s managers havedecided to evaluate the internal and external strengths and weaknesses ofDanaos Corporation and the possibility of facts, as well as their supposedimpacts to company’s potentials. This is the limitation of Weighted SWOTanalysis, as a better and more upgraded version of the old, simple SWOT method;the administrators of corporation manage and aim in crucial matters efficiently.
Its unique disadvantage: the centralization of factors in their single form andnot how they influence Danaos company collectively and holistically. DANAOS CORPORATION PESTEL & ENVIRONMENT ANALYSIS By PESTELanalysis, Danaos Corporation has the ability to examine the macro-environmentof the company. Not to mention that PESTEL means Political, Economic, Social,Technological, Environmental and Legal factors that can interact at any kind oforganization. Shipping can be affected by macro-environment elements,especially in the setup of strategic profitability and advantageouscompetitiveness. Thus, shipping organizations are unable to facemacro-environmental factors, in case political trouble shows up.
For thisreason, Danaos Corporation should be kept up to a consistent ascension thefinancial years following. POLITICAL FACTORS THAT IMPACT DANAOS CORPORATION DanaosCorporation does business in a global shipping market, specifically in morethan ten countries around. Its basic threat;facing the political system and itsenvironment.
Up to recent times, Danaos has achieved great accomplishmentsamong other companies around the globe in shipping industry, aiming to entervarious markets and gain big profits, examining their risks and background ofgovernmental regulations. The criteria to be thought and scrutinized are: · Political stability andimportance of Shipping sector in the country’s economy.· Risk of military invasion· Level of corruption -especially levels of regulation in Services sector.· Bureaucracy and interferencein Shipping industry by government.· Legal framework for contract enforcement· Intellectual property protection· Trade regulations related to Services· Favored trading partners· Anti-trust laws related toShipping· Pricing regulations – Arethere any pricing regulatory mechanism for Services· Taxation – tax rates and incentives· Wage legislation – minimumwage and overtime· Work week regulations in Shipping· Mandatory employee benefits· Industrial safety regulationsin the Services sector.· Product labeling and otherrequirements in Shipping ECONOMIC FACTORS THATIMPACT DANAOS CORPORATION As of now, we have met the macro-environment factors that influence in generalthe advantageous competitiveness, while the macro-economic ones affect theinflation, saving, interest and foreign exchange rate and economic cycle aswell. The macro-economic factors define the percentages in demand and supply ofthe industry and Danaos has shown interest in raising rates and inflation viacustomer’s consumption. Although, these wishes are in need of governmentalshipping economic rules and that advance happens forecasting:· Type of economic system incountries of operation – what type of economic system there is and how stableit is.
Government intervention in the free market and related Services Exchange rates & stability of host country currency. Efficiency of financial markets – Does Danaos Corporation needs to raise capital in local market? Infrastructure quality in Shipping industry Comparative advantages of host country and Services sector in the particular country. Skill level of workforce in Shipping industry. Education level in the economy Labor costs and productivity in the economy Business cycle stage (e.g. prosperity, recession, recovery) Economic growth rate Discretionary income Unemployment rate Inflation rate Interest rates SOCIAL FACTORS THAT IMPACTDANAOS CORPORATION DanaosCorporation is known for the appearance of understanding and the marketingPESTEL planning for their clients.
Danaos has achieved comprehension of cultureand society and confronts PESTEL as the tool to affect the company’senvironment for its benefit. Danaos leads at:· Demographics and skill levelof the population· Class structure, hierarchy andpower structure in the society.· Education level as well aseducation standard in the Danaos Corporation ‘s industry· Culture (gender roles, social conventions etc.)· Entrepreneurial spirit andbroader nature of the society. Some societies encourage entrepreneurship whilesome don’t.· Attitudes (health,environmental consciousness, etc.
)· Leisure interestsTECHNOLOGICAL FACTORS THATIMPACT DANAOS CORPORATION In recentyears, the technological industry has been transformed and formed magically ata rapid pace, without giving the chance to the consumer to espouse the newmedia and move forward with them. For instance, it happens in the everydaylife; till the time they decide which mobile to buy, the next model comes out.Not to mention the automotive sector with the automation, making its ownrevolution. As long as technology disturbs various fields rapidly, Danaosshould keep up with these technological means faster than its competitors, soas to gain earnings and solve any kind of situation in the quickest possibleway.· Recent technologicaldevelopments by Danaos Corporation competitors· Technology’s impact on product offering· Impact on cost structure inShipping industry· Impact on value chainstructure in Services sector· Rate of technological diffusion ENVIRONMENTAL FACTORS THATIMPACT DANAOS CORPORATION PESTEL has categorizedthe environment as well. Each country has its own environmental and taxationregulations and these should be considered before investing to any of them. Renewablesectors, based upon health, are way too different field, and that is why overtaxationis added. Danaos Corporation plays among various markets globally and as eachcountry has its templates; PESTEL helps the company to evaluate environmentalfactors.
These are: · Weather Climate change Laws regulating environment pollution Air and water pollution regulations in Shipping industry Recycling Waste management in Services sector Attitudes toward “green” or ecological products Endangered species Attitudes toward and support for renewable energy LEGAL FACTORS THAT IMPACTDANAOS CORPORATION What is acompany without its legal department? Noteworthy to say, any shipping organizationneeds expansion, and so does Danaos in practice. Danaos, by PESTEL, examinesthe any legal rules among diversed fields, so as the company safely invests onthem. Proper intellectual rights need to be concerned when wishing to pad themarket.
Naming a few:· Anti-trust law in Shippingindustry and overall in the country. Discrimination law Copyright, patents / Intellectual property law Consumer protection and e-commerce Employment law Health and safety law Data Protection