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Non-industrial Private Forestry Service Markets in a Flux: Results from a Qualitative Analysis on Finland

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Abstract

Previous research on European forestry service markets is scarce and mainly focused on analysing external market environment and modelling of timber selling behaviour of non-industrial forest owners (NIPFs). In this study, we aim to create a broader understanding about business perspectives of forestry service markets covering the whole array of market and institutional based services offered to the NIPFs in case of Finland. The more specific empirical objective of the paper is to describe market drivers and underlying challenges in existing and potential service business models based on the concepts of service-dominant logic and dynamic capabilities. Using a qualitative approach and 22 thematic expert interviews in service organisations, we strive to analyse the drivers and opportunities for creating new services within the NIPF market and also build insight in possible barriers for new service value creation. According to our results, the ongoing structural changes offer new opportunities to change traditional mindsets and search for new types of offerings that support the renewal of this traditional forestry sector. As one of the major barriers for new innovations we identified the dominant role of established organisations securing their current positions, mainly driven by the forest industry timber procurement needs. From a managerial perspective, the changing institutional base of the current service organisations may facilitate new innovative business start-ups in addition to enhancing the strategic capabilities and competitiveness of the established firms in Finnish forestry sector.

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Notes

  1. From the strategic perspective of the firm, Kim and Mauborgne’s (1999) value creation concept would be, for example, another view to emphasize the key importance of information on customer needs in the process of firm value creation.

  2. Why we use the term SDL stems from a view that SDL was originally meant as an axiomatic argument as the basis of marketing theory where the service dictates the value and also drives the exchange. Whether in value creation it is a subjective psychological process, a dyadic process or a socially conditioned process, is not the issue. The realisation is that exchange is driven by the instrumental aims of achieving something else through that exchange (e.g. Berghäll 2003).

  3. The contact information of a forest owner has been available for marketing starting in 2012, if a particular forest owner does not actively prohibit it (Finnish Act… 2011).

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Acknowledgments

Financial support from FP-SERVE project funded by the Finnish Innovation Agency (Tekes) during 2010–2012 is gratefully acknowledged. We also thank for reviewers of this journal, as well as participants of the IUFRO 5.10 Conference on Forest Products Marketing in Corvallis, Oregon, USA (June 2011) and Scandinavian Society of Forest Economists in Hyytiälä, Finland (May 2012), for their constructive comments. All remaining errors are our own.

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Authors and Affiliations

  1. Department of Forest Sciences, University of Helsinki, Latokartanonkaari 7, 00014, Helsinki, Finland

    O. Mattila, A. Toppinen, M. Tervo & S. Berghäll

Authors
  1. O. Mattila
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  2. A. Toppinen
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  3. M. Tervo
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  4. S. Berghäll
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Corresponding author

Correspondence to A. Toppinen.

Appendix: Questionnaire for Thematic Interviews

Appendix: Questionnaire for Thematic Interviews

Organization

  • How would you describe the activities and background of your organisation?

  • From where and how did the business idea originate?

  • Are there similar organisations in the market?

  • How does the cyclicality of forestry affect the need for diversity and flexibility in your business?

  • What kind of changes has happened in your organisation recently?

  • What kinds of challenges have you faced?

  • What kinds of untapped opportunities/openings for networking can you imagine?

  • Who are your main customers and is there any segment you are not interested in?

  • Why are you the most interesting actor/organisation for a forest owner?

Services

  • How would you describe your service assortment offering(s), the origins of them and any recent changes?

  • What did you create first in the markets?

  • Who else are active in reforming services?

Demand

  • What kinds of changes have happened among forest owners and in demand?

  • How many opportunities are there for forest owners attending to service processes?

  • Are the changes more towards service packages or to tendering single transactions?

  • What kinds of changes are there in other service buying habits?

Networking

  • Who are the most important actors in your business?

  • What kinds of networking partners do you have and are there any excluded partners?

  • Who do you think would be an interesting partner?

  • Why would you be the most interesting one?

  • In what directions could you expand your customer base through networking?

  • How do you describe the power of the organisations currently in the market?

  • What kinds of opportunities that are there that are not dependent upon the wood trade?

  • What kinds of opportunities are there to expand or cooperate with actors outside traditional forestry?

Competitive environment

  • What are the most remarkable changes that have taken place in the competitive environment?

  • What are the reasons behind them?

  • What kinds of new players have emerged in the markets?

  • What are biggest challenges for your branch?

  • How would you describe the openness in the interaction between yours and other branches?

  • What should be changed in the markets or what would you change?

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Mattila, O., Toppinen, A., Tervo, M. et al. Non-industrial Private Forestry Service Markets in a Flux: Results from a Qualitative Analysis on Finland. Small-scale Forestry 12, 559–578 (2013). https://doi.org/10.1007/s11842-012-9231-1

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  • DOI: https://doi.org/10.1007/s11842-012-9231-1

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