Technical Report
 

Export marketing activities of small-firm lumber manufacturers

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https://ir.library.oregonstate.edu/concern/technical_reports/6682x873j

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  • Many wonder why U.S. companies are not more oriented toward exporting. Increased exports certainly would help alleviate such contemporary problems as the national trade deficit. Business Week (Anon 1987) estimated that if U.S. companies had maintained their 1980 share of overseas markets, the domestic industrial output would be some 8 percent higher today. Relatively few companies account for the majority of U.S. exports (Anon 1987). Smaller- and mid-sized firms play a minor role. Yet the more modest-sized firms produce more economic growth than do large firms. A Dun and Bradstreet study (Anon 1986) indicated that 63.8 percent of an expected three million new jobs in 1986 would be created by companies with 1 to 99 employees, compared to only 15.8 percent by the largest companies (1,000 or more employees). Small- and medium-sized firms generally lack an export orientation. Testimony before a Congressional Subcommittee indicated that about 20,000 U.S. firms considered capable of exporting were not involved (CSDEPP 1987). The limited export activity of smaller U.S. firms has been explained in various ways. Historically, domestic firms had little need to export. The U.S. market, by its very magnitude, amply served small manufacturers. Many small-business managers see exporting as both complex and risky, and therefore not worth the effort; they see only the risks in international trade--"informational gaps, unfamiliar conditions in markets, complicated domestic and foreign trade regulations"-­rather than the opportunities (Czinkota 1986). So they conclude that exports mean marginal business. Facing heightened international competition within the U.S. market, they are reluctant to attempt to compete also in international markets. This is unfortunate. Convincing domestic firms to overcome their fear of export­ing is important, not only for continued viability of individual companies, but also for the health of state and federal economies. Today the encouragement of exports is becoming a major objective of state and national economic planning. In the early 1980's, when domestic markets were in recession, international marketing became especially important to the Oregon economy and its forest products companies, especially to the smaller ones, many of which were lumber producers. These firms could supply export lumber of differing sizes, grades, and species in demand in Europe, the middle East, and the Pacific Rim; few, however, were doing so at the time. Consequently, a research project was designed to learn why many of Oregon's smaller lumber companies were apparently so averse to international trade.
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