University Business Report: Market and SWOT Analysis of CMA-CGM

This report offers a comprehensive market and SWOT analysis of CMA-CGM, a prominent player in the global shipping industry. It begins with an overview of the shipping industry, highlighting CMA-CGM's position as the third-largest container shipping company and its strong financial performance. The report then delves into CMA-CGM's strategic initiatives, including its digitalization efforts and investments in digital marketplaces. A detailed SWOT analysis is provided, outlining the company's strengths, such as its strategic planning and customer focus; weaknesses, including fluctuations in freight rates; opportunities, such as strategic partnerships and business expansion; and threats, such as trade protectionism and market downturns. The report concludes by emphasizing CMA-CGM's proactive measures to navigate challenges and leverage its strengths for continued success in the dynamic shipping market. The report is well-researched with proper referencing.

Running head: Market and SWOT analysis of CMA-CGM
Market and SWOT analysis of CMA-CGM
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Market Outlook
Shipping industries are one of the most reputable industries that are operated all
around the world. Among all the reputed organizations, CMA CGM’s reference is eminent to
occur in the lists of successful shipping companies. The former company has 750+ offices
and agencies around the world. According to the journal by Alix, Slack & Comtois 2016,
CMA CGM was recorded to be the third largest container shipping industry (globally), and
also topped the charts in the France’s market, offering services including port handling
facilities, shipping and logistics(Notteboom & Merckx 2016). The company has a strong
financial position, gaining net profit of $50 million inside the third quarter of 2016, and also
more than $610 million expansive profit in first nine months of 2017, with a prominent 57%
rise in net profit margin, in a yearly basis (Panayides & Wiedmer 2017). The company has
expanded its presence in Africa and European states, by opening new agencies and ground
transport services too. Also, the group had aimed to offer customers services in a digitalized
manner under visibility improvement requirements and dematerialization, and also
company’s improvement in operational performance. On 22nd of August, 2017, the company
further invested ($13 million) in the New York Shipping Exchange (NYSHEX), to enter the
first digital marketplace under the category of ocean freight contracts (Lam & Van De
Voorde 2018). The digitalization strategy was scoped on the internal, commercial and capital
partnerships and projects, under corporate deals and ventures.
Moreover, the container shipping industry is gaining low volume growth, while the
pressure is observed in the freight rates under multiple lines (for short period). Hence, the
group is continuously varying the capacity of adjustment for maintenance of load rates and
optimization of vessel usage, to secure themselves from the backdrops. The fright rates were
predicted to face low growth for the next 2-3 years, from the third quarter of 2015 (Frémont

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2018). However, the company was constantly taking appropriate steps to rebalance the
negative implications. CMA CGM officials also stated with respect to the continuance of
outstanding performance might include the leverage of factors like commercial dynamism,
disciplinary operation and presence in the global market.
SWOT Analysis
Strength: CMA CGM has continuously planned their steps with close attention to
the positive outcomes. The company has been recorded to enhance their position in the global
market, by inheriting multiple strategic goals. The organization anticipates their needs
according to the customer’s needs, by appreciating partnerships and corrective solutions for a
successful business environment. Also, the processes of transport and shipping, under the
supply chain network is constantly simplified and optimized to ease the business operations.
The company has been consistent in delivering excellent customer experience, by the
implementation of value-added services (Notteboom 2013), outstanding digitalization,
supporting start-ups, E-technologies and incubation. Altogether, the company has actively
motivated its employees to undertake initiatives and support innovation, as the talent of the
appointed expertises are immense.
Weakness: On September 5th 2016, the organization had hit a record low profits
under the weak freight rates. The numbers tumbled 94 percent ($24 million) in the second-
quarter sales before the depreciation, tax and other factors were implemented (Lai et al.
2017). Thus, the company responsively reduced their shipping costs by $1.1 billion dollars
for the next 1.5 year period. Moreover, factors were recorded to be fluctuation in margin and
unpredictable rise in costs and freight rates, and also due to impairments.
Opportunity: The Company has expanded their business in many ways. Officials at
the agency of Marseille have been the leaders of managing and monitoring the entire agency

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of CMA CGM’s network. The company has constantly found opportunity in their planning of
strategic partnerships and acquisitions with other profitable business sectors and digital
market partners. Also, the organization has expanded their business segments in different yet
related fields. The group has been identified to be a leader in making inroad goods transport
company in countries like India, Turkey, North Africa and more.
Threat: Risks and threats are part of every business sector, which is evolving and always
expanding for further growth. Thus, the involvement of the same issues are also predicted and
experienced in the CMA CGM’s business operations too. Moreover, the recorded events that
involve threat are unique. Firstly, the factors of increased trade protectionism codes have
significant effect on a business’s smooth sustainability. Also, accidents involving oil spillage,
mechanism defects, employee’s death due to irresponsibility and other vulnerable risks are
realistic to occur. There may also be downturn in the lifecycle of transportation and logistics
market, which in-turn, affect the performance of CMA CGM’s.

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References
Alix, Y., Slack, B. and Comtois, C., 2016. Alliance or acquisition? Strategies for growth in
the container shipping industry, the case of CP ships. Journal of Transport
Geography, 7(3), pp.203-208.
Frémont, A., 2018. Shipping lines and logistics. Transport Reviews, 29(4), pp.537-554.
Lai, K.H., Lun, V.Y., Wong, C.W. and Cheng, T.C.E., 2017. Green shipping practices in the
shipping industry: Conceptualization, adoption, and implications. Resources,
Conservation and Recycling, 55(6), pp.631-638.
Lam, J.S.L. and Van De Voorde, E., 2018. Scenario analysis for supply chain integration in
container shipping. Maritime Policy & Management, 38(7), pp.705-725.
Notteboom, T. and Merckx, F., 2016. Freight integration in liner shipping: a strategy serving
global production networks. Growth and Change, 37(4), pp.550-569.
Notteboom, T., 2013. Container shipping. The Blackwell Companion to Maritime Economics,
pp.230-261.
Panayides, P.M. and Wiedmer, R., 2017. Strategic alliances in container liner
shipping. Research in Transportation Economics, 32(1), pp.25-38.