Due to the fact that Multinational Enterprises (MNEs), who are continually present in the shipping sector, tend to get involved internationally on an increased level, this report is going to analyse ‘Evergreen’ who is one of the largest shipping container carriers in the world. Every company which is involved in international business operations and has the aim to both increase its competitiveness on a transnational level and also to extend its commercial activities will face specific issues in a global business environment. Particularly, so-called Multinational Enterprises, firms who operate across several borders, “have to take numerous strategic decisions” (Schmid, 2018) in order to achieve their main objectives as for example the maximisation of wealth for their stakeholder as well as shareholders.
First of all, this report is going to present an internal analysis of the company’s strengths and weaknesses with a main focus on the economy, plus the company’s competitive position. Above that, positive as well as negative factors of the country Taiwan where Evergreen is founded and headquartered will be shown. In addition to it, an external analysis will be carried out to locate new potential markets for an international expansion. All analyses will be supported by appropriate analytical frameworks. In the end, considering all the mentioned arguments and analysed aspects, a reasonable conclusion will be set up in order to provide a decision.
Table of Contents
1. Introduction
2. Main part
2.1 Internal analysis
2.1.1 Stenghts and weaknesses of Evergreen as a company (FSA)
2.1.2 Country home analysis
2.2 External analysis
2.2.1 Internationalisation factors - Chile
2.2.2 Internationalisation factors - Colombia
2.2.3 Internationalisation factors - Cameroon
3. Conclusion/Recommendation
Objectives and Research Themes
The primary objective of this report is to evaluate the strategic position of the multinational shipping enterprise 'Evergreen' and identify potential target markets for its international expansion. The study investigates the company's internal capabilities and external country-specific factors to provide a recommendation for future growth.
- Internal analysis of Evergreen's firm-specific advantages (FSA) and weaknesses.
- Economic analysis of the home country (Taiwan) and its impact on the firm.
- Evaluation of potential international markets: Chile, Colombia, and Cameroon.
- Application of analytical frameworks to assess market entry and investment risks.
Excerpt from the Book
2.1.1 Strengths and weaknesses of Evergreen as a company (FSA)
Strengths: A noteworthy advantage or firm-specific advantage (FSA) of the shipping company Evergreen is being a part of the worldwide operating ‘Evergreen Group’ which is a conglomerate providing a range of diversified services among others in the shipping sector, air transportation (cargo and people) storage of containers, and various other services (Evergreen Group, 2019) which represent correlative logistic benefits. Due to its diversification interest, the beneficially developed infrastructure, plus being a member of the ‘Ocean Alliance’ with other container carriers, Evergreen as a subsidiary can realise different synergy effects and the economies of scale which would result when as e.g. “multiple business units share distribution, marketing, and administrative costs” (Rosset, 2012, p. 29). Moreover, Evergreen owns several terminals at different ports (Evergreen Shipping, 2019) providing a significant geographical and operational advantage by accelerating the local freight circulation and facilitating the transport connection between the port and storage warehouses as well as industrial complexes.
Furthermore, another considerable strength is Evergreen’s focus on sustainability and CSR (Corporate Social Responsibility) which enhances its positive global reputation. In view of the internationally rising demand for CSR (Epstein-Reeves, 2010) from customers and various other stakeholders, companies are more required to meet these demands which by the way is a form of social investment that would not only increase the company’s positive reputation but is also “highly connected stakeholder engagement” (Amankwah and Taylor, 2016). According to Andersson et al. (2016), the transportation of goods via ships has heavily increased since the industrial revolution which also has not only resulted in higher emissions but is also generally a significant sign that the environment is being stressed. Therefore, Evergreen Line (2019) officially published and implemented a set of internal measures (‘Environmental Guardians’) in order to comply with the international regulations as well as reduce the negative environmental impacts.
Summary of Chapters
1. Introduction: This chapter outlines the global business environment, the role of Multinational Enterprises (MNEs) in the shipping sector, and defines the report's scope regarding the analysis of Evergreen.
2. Main part: This section provides a comprehensive internal analysis of Evergreen's strengths and weaknesses, followed by an external analysis of the economic and market conditions in Taiwan, Chile, Colombia, and Cameroon.
2.1 Internal analysis: This chapter examines the firm-specific advantages of Evergreen as a conglomerate and analyzes the macroeconomic home environment of Taiwan.
2.1.1 Stenghts and weaknesses of Evergreen as a company (FSA): This section details the operational advantages of Evergreen's diversification and CSR initiatives, while identifying risks associated with overcapacity in vessel investment.
2.1.2 Country home analysis: This chapter evaluates Taiwan's economic performance and its competitiveness pillars to understand the environmental factors affecting Evergreen's home operations.
2.2 External analysis: This chapter focuses on exploring potential international growth regions for the company using structured country analysis.
2.2.1 Internationalisation factors - Chile: This section assesses the attractiveness of Chile as a market, highlighting its GDP growth and renewable energy sector while noting political and educational challenges.
2.2.2 Internationalisation factors - Colombia: This section investigates the potential for business expansion in Colombia, focusing on its growing economy and natural resources, despite risks related to corruption and security.
2.2.3 Internationalisation factors - Cameroon: This chapter evaluates Cameroon's potential as an FDI destination, emphasizing its young labor force and natural resource wealth, while acknowledging the need for significant infrastructure investment.
3. Conclusion/Recommendation: The final chapter summarizes the findings and advises Evergreen to focus on expansion into Chile and Cameroon, while actively investing in local human development to mitigate risks.
Keywords
Evergreen, International Business, Multinational Enterprises, Taiwan, Chile, Colombia, Cameroon, Shipping, CSR, Foreign Direct Investment, Economic Growth, Market Expansion, Sustainability, Infrastructure, Global Trade.
Frequently Asked Questions
What is the core focus of this report?
This report analyzes the international business operations of the container shipping company Evergreen, assessing its internal strategic capabilities and potential new markets for growth.
Which countries are evaluated for international expansion?
The report specifically assesses the suitability of Chile, Colombia, and Cameroon as potential targets for Evergreen’s international expansion.
What is the primary goal of the research?
The goal is to determine a recommended internationalization strategy for Evergreen that aligns with its objectives of economic growth and CSR commitment.
Which methodology is applied?
The report utilizes analytical frameworks to conduct both an internal analysis of the company's firm-specific advantages (FSA) and an external analysis of host-country economic environments.
What does the main part of the report cover?
The main part covers an internal analysis of Evergreen, the macroeconomic environment of its home base (Taiwan), and a comparative study of internationalization factors for the chosen Latin American and African markets.
Which main keywords characterize this work?
Key terms include Evergreen, International Business, Foreign Direct Investment, CSR, and market expansion strategies in emerging economies.
What specific competitive advantage does Evergreen hold according to the report?
Evergreen benefits from being part of the diversified Evergreen Group, which provides logistic synergies, and from its proactive commitment to CSR and environmental sustainability.
Why is investment in vessel size identified as a potential weakness?
The report notes that over-reliance on massive vessels risks overcapacity, leading to lower freight rates and decreased profitability if ships are not fully loaded.
How does the report view the educational situation in the target countries?
The report highlights that both Chile and Cameroon face challenges with their educational systems, which creates a need for Evergreen to invest in local training centers to secure a skilled workforce.
- Quote paper
- Dimitri Tsiganovski (Author), 2019, Internationalisation Strategy for a Multinational Enterprise (MNE) in the Shipping Industry, Munich, GRIN Verlag, https://www.grin.com/document/511282
