IDEAS home Printed from https://ideas.repec.org/a/eee/forpol/v115y2020ics1389934119301315.html
   My bibliography  Save this article

Typology of contractors for forestry services: Insights from Slovakia

Author

Listed:
  • Štěrbová, Martina
  • Kovalčík, Miroslav

Abstract

The forestry services market in Slovakia has begun to form in the early 1990s under unstable and changing conditions due to the restitution of forest property rights and the restructuring of state-owned enterprises. The transition of State Enterprise Forests towards outsourcing of forestry activities was completed in a relatively short time period, which was insufficient for an adequate formation of this sector. Therefore, it is weakly developed, undercapitalised and has a low competitive ability. On the other hand, at present, there is a high dependence on contractor firms, which carry out the most part of logging, silviculture and transport activities within the forestry. Nowadays, the forest business community consists of more than 10,600 contractors, 88% are self-employed persons and 12% represent business companies. According to the structure of revenues and cost items, the aim of the study was to identify and characterize the firm types of contractors in the forest service sector in Slovakia, with an emphasis on Limited Liability Companies. Methodologically, it is based on the analysis of basic economic data from a representative sample of 152 contractors and a vertical analysis of their income statements. A detailed analysis of revenue and cost items showed that the most significant part of total income of the selected companies comes from the sale of own products and services (58%). On the other hand, the highest value within the total expenses were found for production consumption (57.2%) and cost of merchandise sold (31.8%). Subsequently, five types of business strategies were identified and characterised. Business strategies of contractors are influenced by the current situation within the sector. Low prices for provided services and a lack of qualified workers in the labour market cause mean that it is not possible to apply the classic business strategies. Contractors try to apply their own strategies such as orientation to business or management of subcontractors. They mostly prefer the so-called „Classic strategy”, which focuses on providing services as well as trading activities to complement their business activities. We therefore expect an increased number of contractors who provide forestry services through their own employees. Another possible way is to allow contractors to implement new business strategies and innovations through a higher degree of the standing timber sale.

Suggested Citation

  • Štěrbová, Martina & Kovalčík, Miroslav, 2020. "Typology of contractors for forestry services: Insights from Slovakia," Forest Policy and Economics, Elsevier, vol. 115(C).
    • Handle: RePEc:eee:forpol:v:115:y:2020:i:c:s1389934119301315
    DOI: 10.1016/j.forpol.2020.102143
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1389934119301315
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.forpol.2020.102143?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Erlend Nybakk, 2012. "Learning Orientation, Innovativeness And Financial Performance In Traditional Manufacturing Firms: A Higher-Order Structural Equation Model," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 16(05), pages 1-28.
    2. Drolet, Steve & LeBel, Luc, 2010. "Forest harvesting entrepreneurs, perception of their business status and its influence on performance evaluation," Forest Policy and Economics, Elsevier, vol. 12(4), pages 287-298, April.
    3. Eriksson, Mattias & LeBel, Luc & Lindroos, Ola, 2015. "Management of outsourced forest harvesting operations for better customer-contractor alignment," Forest Policy and Economics, Elsevier, vol. 53(C), pages 45-55.
    4. Ruta Aidis, 2005. "Institutional Barriers to Small- and Medium-Sized Enterprise Operations in Transition Countries," Small Business Economics, Springer, vol. 25(4), pages 305-317, November.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Štěrbová, Martina & Stojanovski, Vladimir & Weiss, Gerhard & Šálka, Jaroslav, 2019. "Innovating in a traditional sector: Innovation in forest harvesting in Slovakia and Macedonia," Forest Policy and Economics, Elsevier, vol. 106(C), pages 1-1.
    2. Štěrbová, Martina & Výbošťok, Jozef & Šálka, Jaroslav, 2021. "A classification of eco-innovators: Insights from the Slovak forestry service sector," Forest Policy and Economics, Elsevier, vol. 123(C).
    3. R. Sandra Schillo & Ajax Persaud & Meng Jin, 2016. "Entrepreneurial readiness in the context of national systems of entrepreneurship," Small Business Economics, Springer, vol. 46(4), pages 619-637, April.
    4. Andrés Rodríguez‐Pose & Roberto Ganau & Kristina Maslauskaite & Monica Brezzi, 2021. "Credit constraints, labor productivity, and the role of regional institutions: Evidence from manufacturing firms in Europe," Journal of Regional Science, Wiley Blackwell, vol. 61(2), pages 299-328, March.
    5. Aparicio, Sebastian & Urbano, David & Audretsch, David, 2016. "Institutional factors, opportunity entrepreneurship and economic growth: Panel data evidence," Technological Forecasting and Social Change, Elsevier, vol. 102(C), pages 45-61.
    6. Kibeshi Kiyabo & Nsubili Isaga, 2019. "Strategic entrepreneurship, competitive advantage, and SMEs’ performance in the welding industry in Tanzania," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 9(1), pages 1-23, December.
    7. Bordunos, A. & Kosheleva, S., 2016. "High Involvement Work System from organizational and individual perspective," Working Papers 6445, Graduate School of Management, St. Petersburg State University.
    8. Richard PEK & Marcel RIEDL & Vilém JARSKÝ, 2017. "Innovative approaches in forest management - the application of a business model to designing a small-scale forestry strategy," Journal of Forest Science, Czech Academy of Agricultural Sciences, vol. 63(9), pages 393-400.
    9. Xuequn Wang & Leonard M. Jessup, 2014. "A Review and Synthesis of Entrepreneurship Research: Towards an Integrative Model of Dependent Variables," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 23(2), pages 163-199, September.
    10. Hernan G. Roxas & Val Lindsay & Nicholas Ashill & Antong Victorio, 2007. "Institutional analysis of strategic choice of micro, small, and medium enterprises : a conceptual framework," Philippine Review of Economics, University of the Philippines School of Economics and Philippine Economic Society, vol. 44(1), pages 151-186, June.
    11. Maribel Guerrero & David Urbano, 2020. "Institutional conditions and social innovations in emerging economies: insights from Mexican enterprises’ initiatives for protecting/preventing the effect of violent events," The Journal of Technology Transfer, Springer, vol. 45(4), pages 929-957, August.
    12. Ratnawati & Budi Eko Soetjipto & F. Danardana Murwani & Hari Wahyono, 2018. "The Role of SMEs’ Innovation and Learning Orientation in Mediating the Effect of CSR Programme on SMEs’ Performance and Competitive Advantage," Global Business Review, International Management Institute, vol. 19(3_suppl), pages 21-38, June.
    13. van der Zwan Peter & Verheul Ingrid & Thurik Roy, 2011. "The Entrepreneurial Ladder in Transition and Non-Transition Economies," Entrepreneurship Research Journal, De Gruyter, vol. 1(2), pages 1-20, March.
    14. Thomas Gries & Ha van Dung, 2014. "Institutional environment, human capital, and firm growth: Evidence from Vietnam," Working Papers CIE 83, Paderborn University, CIE Center for International Economics.
    15. Richard Woodward & Elzbieta Wojnicka & Wojciech Pander, 2012. "Innovation Systes and Knowledge-Intensive Enterpreneurship: a Country Case Study of Poland," CASE Network Studies and Analyses 0446, CASE-Center for Social and Economic Research.
    16. Pekka Stenholm & Zoltán J. Ács & Robert Wuebker, 2015. "Exploring country-level institutional arrangements on the rate and type of entrepreneurial activity," Chapters, in: Global Entrepreneurship, Institutions and Incentives, chapter 20, pages 387-404, Edward Elgar Publishing.
    17. Kuo-Jui Wu & Ching-Jong Liao & Ming-Lang Tseng & Pei-Jay Chou, 2015. "Understanding Innovation for Sustainable Business Management Capabilities and Competencies under Uncertainty," Sustainability, MDPI, vol. 7(10), pages 1-35, October.
    18. Stephan Hoffmann & Dirk Jaeger & Wu Shuirong, 2018. "Adapting Chinese Forest Operations to Socio-Economic Developments: What is the Potential of Plantations for Strengthening Domestic Wood Supply?," Sustainability, MDPI, vol. 10(4), pages 1-19, April.
    19. Yongseok Jang & Woo Jin Lee & Brandy Hadley, 2020. "Interactive Effects of Business Environment Assessment and Institutional Programs on Opportunity Entrepreneurship," Sustainability, MDPI, vol. 12(13), pages 1-18, July.
    20. Vlasova, N. Yu. & Kalganova, O. O., 2018. "Evaluation of economic security in the Ural region in the context of development of small and medium-sized enterprises," R-Economy, Ural Federal University, Graduate School of Economics and Management, vol. 4(3), pages 121-129.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:forpol:v:115:y:2020:i:c:s1389934119301315. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/forpol .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.