Swot Analysis Of Shell Company

SHELL PETROLIUM

Company Profile: Royal Dutch Shell plc commonly known as Shell is a multinational oil and gas company. Royal Dutch Petroleum Company was registered in 1890 and Shell Transport and Trading Company registered in 1897. In 1907, both companies merged as Royal Dutch Shell plc because both companies were focused on Asian markets. Shell’s headquarter is in Hague, Netherland and its registered office in London, United Kingdom. It is the second largest company in the world in terms of Revenue (US$ 467.153 billion, 2012). Shell is vertically integrated and is active in every area of oil and gas industry like exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading etc. It has

Firms can only gain market by better quality and superior customer services e.g. oil change, car wash etc.

Bargaining Power or Suppliers: Major suppliers of oil and gas industry are Saudi Arabian Oil Company, E.N.I Pakistan LTD, Oil & Gas Development Company LTD, Pakistan Petroleum LTD, British Petroleum etc. As the suppliers are powerful, they have an influence on producing industry such as selling raw material at a higher price to capture some of the industry profits. They can integrate forward. Shell’s main suppliers in Pakistan are Pakistan refinery, National refinery and Attock refinery and Dhodak refinery. Thus, bargaining power of suppliers is very high.

New Entrants: There are very high barriers to new entrants because of high prices of petroleum products and instable prices and policies form government like taxes, fright margin, petroleum development levy etc. Those already operating in oil and gas industry have achieved the economy of scales, efficient ways of transportation and low cost operations. Thus, threat of new entrants is

They must improve the productivity and utilization of biofuel energy by continuous R&D with time. By these steps, first they’ll gain competitive edge and capture more market and secondly they’ll also contributing benefits to environment.

Shell’s existing strategy is to invest in the development of major growth projects, primarily in the upstream businesses of Exploration & Production and Gas & Power. Thus their current strategy is focusing on new oil and gas projects, gas opportunities; and continuing to unlock oil and gas resources. On the other hand, our strategy is to invest and focus in Biofuel to produce cost effective fuels.

The comparison shows that both strategy are in align with each other whereas Shell strategy is to invest and develop major growth project in Gas & Power while our recommendation narrow it down to Biofuel investment which is also Gas & Power. Their plan to focus on oil and gas project match with our recommendation to invest by region as Biofuel is an alternative energy that has high potential of replacing fossil fuels in those