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Session 7 ic2011 hamner

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Session 7 ic2011 hamner

  1. 1. Identifying the Relevance of “Family Forest” Wood Product Origin for Oregon Industrial Customers and SpecifiersRebecca HamnerPh D StudentForest Products MarketingDept Wood Science & EngineeringForest Business Solutions
  2. 2. Road Map• Objective• Background• Methods• Results• Conclusions• Future Research www.allmaps.tk/about/street-maps-world/world-open-street-map
  3. 3. Objective• Evaluate the relevance of family wood origin to industrial customers and specifiers in the forest products industry.
  4. 4. US Forestland• ~751 million acres ▫ 56% is private ownership (~420 million acres) (USDA May 2008)• Private Ownership ▫ Forest industry companies ▫ Other businesses or corporations ▫ Partnerships ▫ Tribes ▫ Families www.rootcellar.us/wildflowers/conifers.htm
  5. 5. US Forestland http://www.nrs.fs.fed.us/pubs/inf/NRS-INF-06-08.pdf
  6. 6. Family Forestland• Family Forests “include lands that are at least 1 acre in size, 10% stocked, and owned by individuals, married couples, family estates and trusts, or other groups of individuals who are not incorporated or otherwise associated as a legal entity” -Bulter and Leatherberry 2004
  7. 7. Family Forestland • Private ownership ▫ ~420 million acres  62% is owned by families  ~260 million acres Owners • ~11 million private forest owners ▫ Over 10 million family forest ownersBulter and Leatherberry 2004; USDA May 2008
  8. 8. Oregon Ownership • 30 million acres of forestland in Oregon (2010) State of Other Public Oregon 2% 3% Private ~11 million acres 35% Federal 60%OFRI 2010
  9. 9. Family Forestland In Oregon ▫ 38% is family owned (~4.25 million acres) ▫ 141,000 family forestland ownersOFRI 2010 www.tonyvillelli.com/2020applications/propertylistings.asp
  10. 10. Oregon Timber Harvest Harvest Totals =3.79 billion bf (2007) •Private =3.3 billion bf •Federal =.30 billion bfhttp://oregonforests.org/assets/uploads//Fact_Harvest.pdf
  11. 11. Region or country of origin• Papadopoulos and Heslop 2002-Wine ▫ Countrys image has a direct influence on product evaluations.• Teas and Agarwal 2000-Business Calculators and Wristwatches ▫ Country-of-origin cue was found to have a significant main effect on the perceived quality for both of the product.• DeBono and Rubin 1995-Cheese ▫ When the same cheese was believed a product of country with a desirable image (France), product was more liked compared to a general product (Kansas).• Geisenheim 2006- Sparkling Wine ▫ Groups do perceive the attribute country-of-origin important for their purchase decision• Donovan and Nicholls 2003-Alaska Red Alder Table ▫ Alaskans are willing to pay a significant price premium for secondary wood products manufactured in the state  Reasonable to assume that consumers in other states may be willing to pay a price premium for locally produced wood products
  12. 12. Wood Originating from Certified Forest• Anderson and Hansen 2004-Wood CD Rack ▫ Environmental certification showed limited importance for typical respondents but is an important attribute of responses• Macias and Knowles 2010-Hardwood Flooring ▫ Oregon/Washington architects consider price and wood source the two most important; environmental certification found to be the least important• Spinazze and Kant 1999-Furniture, Flooring, Lumber and Paper ▫ Importance for products that originate from sustainably managed forests ▫ Willingness to pay 10% premium for furniture/ flooring/paper from certified forests• Bigsby and Ozanne 2002-Outdoor Wood Furniture ▫ New Zealand consumers view source of wood as most important, then type of forest sourced from, environmental certification , length of warranty and price was least important
  13. 13. Product Origin• With country of origin and environmentally certification being relevant to customers, will they also find relevance in family ownership?
  14. 14. Industrial Customers and Specifiers• Architects, homebuilders and contractors in Oregon www.brockbuildersinc.com/823/wood-frames-home www.aipcatania.com/wood-framed-homes• Purchased list from AllMedia, Inc ▫ Identified using SIC codes
  15. 15. MethodsConjoint Analysis Approach through a Mail Questionnaire ▫ SPSS 10.0 Conjoint Analysis ▫ Conjoint Analysis  Tool used to “model consumer preferences among multiattribute alternatives” (Green and Srinkivasan 1978)  Contains attributes with levels
  16. 16. Attribute Levels• Price ▫ $13,500 (-10% from base) ▫ $15,000 (base price) ▫ $16,500 (+10% from base)• Wood Origin ▫ Family: lumber processed from trees grown on family owned forestland ▫ Corporate: lumber processed from trees grown on corporate owned forestland ▫ Unknown: lumber processed from trees grown on forestland of unknown ownership• Certification ▫ FSC Ecolabel: the lumber displays a Forest Stewardship Council (FSC) ecolabel indicating the product comes from a well-managed forest ▫ Other Ecolabel: the lumber displays an ecolabel indicating the product comes from a well-managed forest (American Tree Farm System (ATFS), Canadian Standard Association (CSA), Programme for the Endorsement of Forest Certification (PEFC), Sustainable Forestry Initiative (SFI), etc.) ▫ None: no information regarding the forest management practices used for the product was provided
  17. 17. www.sslumbr.com/lumber.htmlCONJOINT CARDSScenario Imagine you are buying lumber to frame a 2,500 square foot singlestory house, below you are face with 9 alternatives. Each alternative is adifferent combination of the three attributes. Consider the features listed for eachof the following alternatives and then rank the alternatives from 1 – the one youmost prefer, to 9 – the one you least prefer. Alternative A Rank _____ Alternative B Rank _____ Alternative C Rank _____ Price: $13,500 Price: $16,500 Price: $13,500 Origin: Unknown Origin: Corporate Origin: Family Certification: None Certification: None Certification: FSC Ecolabel Alternative D Rank _____ Alternative E Rank _____ Alternative F Rank _____ Price: $15,000 Price: $15,000 Price: $13,500 Origin: Family Origin: Corporate Origin: Corporate Certification: None Certification: FSC Ecolabel Certification: Other Ecolabel Alternative G Rank _____ Alternative H Rank _____ Alternative I Rank _____ Price: $15,000 Price: $16,500 Price: $16,500 Origin: Unknown Origin: Unknown Origin: Family Certification: Other Ecolabel Certification: FSC Ecolabel Certification: Other Ecolabel
  18. 18. Characteristics• Firm Characteristics ▫ Profession ▫ Number of Employees ▫ Total Billings/Income• Respondent Characteristics ▫ Number of years in practice ▫ Gender ▫ Age ▫ Education
  19. 19. Mail Survey• Follow the Tailored Design Method by Dillman (2000) ▫ Mailed  Cover letter  Questionnaire  Pre-paid addressed return envelope ▫ 2 waves• Adjusted Response 20% ▫ (361 usable returned/(2174 sent – 383 nondeliverable))
  20. 20. Firm Characteristics Profession Architects 10% 39% Homebuilders 37% Contractors 14% Total Billing/Income Other Less than $250,000 $250,000-$999,999 $1 million-$9,999,999 $10 million or more 5% 16% 49% 30%
  21. 21. Firm Characteristics Number of Employees 1-19 20-49 50-99 100+ 5% 3%2% 90% www.entrepreneursoul.co.cc/2009/07/de http://www.joe-ks.com/archives_dec2003/UniqueEmployees.jpg sign-furniture-for-small-office-with.html
  22. 22. Respondent Characteristics Gender 7% Male 93% Female Age 7% 36% 18% 26-35 36-45 39% 46-55 56-65
  23. 23. Respondent Characteristics Education Less than high school diploma 17% 36% High school diploma 12% 2-year associate degree 35% 4- year college degree Advanced degree Average Range Number of years in 25 1-63 Practicehttp://www.phillyimc.org/en/america-no-longer-world%E2%80%99s-education-leader
  24. 24. Results Price Utility $13,500 2.037 $15,000 0.141 $16,500 -2.178 Wood Origin Utility Family 0.827 Corporate -0.055 Unknown -0.772 Certification Utility FSC Ecolabel 0.76 Other Ecolabel 0.23 None -0.989
  25. 25. Attribute Importance Certification 25% Price 52% Wood Origin 23%
  26. 26. Top Ten Scenario Preferences Rank Price Wood Origin Certification 1 $13,500 Family FSC 2 $13,500 Family Other 3 $13,500 Corporate FSC 4 $13,500 Other FSC 5 $13,500 Corporate Other 6 $13,500 Family None 7 $13,500 Other Other 8 $15,000 Family FSC 9 $15,000 Family Other 10 $13,500 Corporate None
  27. 27. http://www.writeawriting.com/writers/writing-conclusions//Conclusions• Price most important product attribute ▫ Certification and wood origin were least important attributes• Respondents prefer low prices, some certification and family origin• Results show some opportunity for family forest owners to market wood with a family origin
  28. 28. Future Research Plans• Evaluate relevance based on profession• Evaluate preferences of respondents based on firm size• Utilize other parts of questionnaire to evaluate environmental consciousness of respondents
  29. 29. Acknowledgements• Wood Utilization Research Centers (WUR)• Oregon Forest Resources Institute (OFRI)• Forest Business Solutions Group• Dept. Wood Science and Engineering

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