Integration in the forest industry of British Columbia
is a complex phenomenon. Its history is almost as long as
that of the industry itself. The industry is multi-faceted,
with many spheres of concern and activity, and the process
of integration has necessarily been a highly differentiated
one. Characteristically, it has developed at different rates
and to different degrees in and between each of the various
sectors of activity.
This thesis will examine the growth of integration in
the forest industry of British Columbia and will inquire into
the fundamental factors of influence in the development of
this phenomenon.
The terminology applied to the various types of
integration is reasonably standard and self explanatory. However,
for the sake of clarity and since the industry is a
complex one, it is appropriate to discuss the precise application
of these terms in this thesis.
There are four basic components of the British Columbia
forest industry—forestry, harvesting, conversion, and marketing.
Only the first of these functions remains substantially outside
the private domain, and in consequence of this, timber
control is generally treated as a function in itself.
Within each of these sectors one finds the process
of horizontal integration whereby like entities become
amalgamated. This is generally referred to as concentration
or as consolidation.
In the conversion or manufacturing sector, activity
is sufficiently differentiated by output that four major
product groups may be identified—lumber, shingles, plywood,
and wood pulp. Integration between these sectors is vertical
integration.
Integration between any of the four functions in the
industry (e.g. logging, conversion, etc.) is referred to as
vertical integration. It involves the inclusion of two or more
industry functions within a single corporate structure.
Not all integration is corporate however, and various
forms of cooperative integration are prevalent throughout
the industry. This is an extremely important aspect of
industry structure, and it is found in harvesting (contract
logging), conversion (log exchange, residue sales), and
marketing (consortium selling.)
The major environmental forces acting upon the industry
lie in three principal areas—the nature of the raw material
base, the activities of government, and the nature of the
market environment. Their influences upon integration have
always been a combination of pressure and facilitation.
Government, for instance, has introduced forest utilization
regulations and large-scale and semi-permanent tenures. The
former development has put great pressure on firms to integrate,
while the latter has facilitated the formation of large-scale
manufacturing operations. In marketing, competitive pressures
have stimulated integration of many types, while the consolidation
of channels and growth of markets have facilitated
forward integration into this phase of activity. / Business, Sauder School of / Graduate
| Identifer | oai:union.ndltd.org:UBC/oai:circle.library.ubc.ca:2429/41924 |
| Date | January 1971 |
| Creators | Robinson, Peter |
| Publisher | University of British Columbia |
| Source Sets | University of British Columbia |
| Language | English |
| Detected Language | English |
| Type | Text, Thesis/Dissertation |
| Rights | For non-commercial purposes only, such as research, private study and education. Additional conditions apply, see Terms of Use https://open.library.ubc.ca/terms_of_use. |
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