The purpose of this study is to suggest a strategy to promote competitiveness of container terminals in the port of Busan. The port of Busan is currently facing several difficult challenges domestically and overseas. Its export-import container throughput has significantly reduced because of global financial crisis. Especially, recent rise of Chinese ports is posing a great threat to its container volumes from tranship. Chinese competitors are keenly expanding port facilities and improving productivity. They are attracting global liner carriers to call them directly.
Traditionally, the seaport had been viewed as a gateway through which exports and imports move on their way to the next stage of production or the final consumers. However, its role is rapidly changing as a trading and distribution center and the governments of major seaports designated the port logistics as one of their key industries.
As for the port of Busan, to acquire its competitiveness, it is necessary to expand its container terminals, to improve port business environments, and, most importantly, to develop the terminal operators into the Global Terminal Operators(GTO). Such strategies can have the port affordably, attract more transship volumes, and improve itself into value-added logistics hub.
This study concludes that terminal operators in Busan port have five main must-dos to transform themselves into the GTOs. First, they should set global strategy by recruiting experts. Second, they expand their business areas for the sake of economies of scale. Third, they need to innovatively diversify their business portfolio to become more profitable. Fourth, they should improve their service qualities, such as convenience, service accuracy, stability, to boost customer loyalty. Last, but not the least, they have to improve service productivity to reduce calling time of the carriers. This strategy can minimize their customers' opportunity costs and differentiate their services.