Research On Container Liner Shipping Pricing Based On Option Theory

Container liner shipping is the main mode of transportation in international trade,carrying the shipping services of the vast majority of goods.In recent years,with the increasingly fierce market competition,the liner shipping industry has a low point,where its monopoly characteristics slowly fade.Meanwhile,the liner has become a passive receiver of the market price from the price controller.The profit of liner mainly comes from freight of containers.However,due to the limitation of the ship’s total capacity and its strong timeliness,the pre-sale container is a powerful way to deal with the risk of container utilization,and it can avoid the risk of freight rate fluctuation.As a result,the liner gradually focused on the combination of forward and spot markets.Pricing strategy based on option theory has become an important way to stabilize business.In order to increase the carrier’s revenue and improve the utilization rate of container,this paper mainly takes two measures:(1)On the basis of slot allocation,forecast the demand of contract market,and the remaining slot capacity of the liner company in the spot market is obtained.According to the difference of the remaining slot capacity,appropriate price measures are taken to improve the utilization rate of slot;(2)Design the sea freight option,for getting better margin through guiding more actual shippers to order through carrier rather than freight agents.On the basis of market segmentation,this paper divides customers into contract customers and ordinary customers,and completes the demand forecast on the historical data of contract customers.Based on the option theory,with the carrier as the leader and the shipper as the follower,this paper sets a Stackelberg game model for the carrier pricing decision and the shipper booking process,analyzing the best actions of the carrier and the shipper.The results show that the options can effectively coordinate the supply chain,not only increase the revenue of the carrier,but also reduce the booking cost of the shipper,achieving a win-win situation.The more competitive the carrier is,the less the profit is given to the shipper on the options,and the less the option booking volume is.At the same time,it is found that different price distributions have influence on carrier’s pricing strategy.