Edited by Gry Agnete Alsos, Sara Carter, Elisabet Ljunggren and Friederike Welter
Chapter 6: Obstacles to the Development and Strategic Intentions of Forestry SMEs in Eastern Canada
Etienne St-Jean, Luc LeBel and Josée Audet This study focuses primarily on determining the existence of different types of SMEs involved in the forestry industry. We are also interested in finding out whether obstacles to business development and strategic intentions vary according to SME type. Results obtained from a sample of 535 forestry SME owner-managers reveal the existence of two types of forestry SMEs. The first, which could be referred to as large diversified enterprises, generates a large portion of its revenues from out-of-forest activities, as opposed to the small focused enterprises, which usually operate under a main contractor and whose activities are conducted exclusively in-forest. Small focused enterprises primarily point to economic uncertainty and operating costs as obstacles to development compared to the large diversified enterprises. Strategic intentions are also fundamentally different for owner-managers of both types of SMEs. Thus, despite the difficult economic climate currently affecting the forestry industry, large diversified enterprises claim to both pursue out-of-forest diversification as well as growth within the forestry industry, whereas small focused enterprises wish to pursue industry withdrawal strategies, such as selling the business or scaling back business activities. Considering that certain business development obstacles primarily affect small focused enterprises, a transition towards increasing the scope of forestry businesses as well as supporting diversification could be important avenues to consider in order to ensure their survival. INTRODUCTION Since the end of the 1970s, the forestry industry in Eastern Canada has evolved from a structure entirely controlled by large pulp and...
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