The Performance of Seaport Clusters - RePub - Erasmus Universiteit ...

Chapter 15 – Opportunities for Policy and Management in Seaport Clusters 215
intermediaries are ‘customers’ of seaports; they control substantial volumes of cargo.
Intermediaries generally speaking have limited assets, and can shift easily between ports.
However, most forwarders select one port as consolidation hub.
Attracting consolidation cargo from the intermediaries is predominantly an issue of
developing a sound price/quality package, because the price-elasticity of the demand of
intermediaries is very high. However, port authorities have no commercial relation with
intermediaries: they do not lease land, nor pay port dues. Thus, in Rotterdam, as well as in
the LMPC, intermediaries have become ‘the forgotten customers’ of the port. A form of
‘account management’ for intermediaries can improve relations with intermediaries and
provide the port authority with relevant management information. The port authority in
Rotterdam has recently developed a structure with account managers.
Forwarders obtain volume discounts, for instance from shipping lines and inland transport
firms. In the port, such discounts are not a common practice since forwarders have no
commercial relations with either the port authority or the terminal operators. Nevertheless
discounts can be justified with theoretical arguments (e.g. more volume, more purchasing
power). Therefore in ports where the absence of (activities of) forwarders is a weakness,
port authorities can consider developing a tariff scheme that allows for giving discounts to
actors that generate substantial volumes for the port 97 .
15.7 Opportunities to encourage leader firm behavior
Leader firm involvement arises when leader firms have both the ability and the incentives to
act as a leader firm. Leader firms generally have incentives to make investments with
benefits for other firms in the cluster, simply because they have a substantial market share.
97 This is an issue that deserves more attention in future studies. Central in the discussion is the
(marginal) effect of volume discounts on cargo volumes. In the current situation (in Rotterdam
and probably other ports as well), ship-owners get volume discounts, while intermediaries
(forwarders) do not. The question is: who of those two would bring more volumes to a port when
offered a volume discount. The current practice is only effective when ship-owners indeed react
much more to volume discounts than intermediaries. We have the impression that, especially in
‘destination ports’ (rather than transshipment ports) this is probably not the case.