Critical success factors for small and medium forest enterprises: A review

• Published in: Forest policy and economics Vol. 94; pp. 35 - 45
• Main Authors: Sanchez Badini, Olivia, Hajjar, Reem, Kozak, Robert
• Format: Journal Article
• Language: English
• Published: Amsterdam Elsevier B.V 01.09.2018; Elsevier Science Ltd
• Subjects: Business administration; business enterprises; business management; Clustering; Companies; Constraints; Critical success factors; Developing countries; Economics; Economies of scale; Efficacy; Enabling environments; Environmental law; Financial planning; forest industries; Forest management; Forest products industry; Forest-dependent people; Forestry; Forestry economics; forestry law; Forestry laws; Forests; income; issues and policy; Land use; Land use management; Land use planning; Law; law enforcement; LDCs; Literature reviews; Livelihood; Macroeconomics; Management; Markets; natural capital; Ownership; politics; Poverty; Small & medium sized enterprises-SME; Small and medium enterprises; Success factors; Tenure; Forests; Enabling environments; Poverty; Small and medium enterprises; Critical success factors; Forest-dependent people
• ISSN: 1389-9341; 1872-7050
• DOI: 10.1016/j.forpol.2018.06.005

Small and medium forest enterprises (SMFEs) are small firms in developing countries aimed at generating income from a diverse set of forest-related activities. They result in multiple dimensions of economic, social, and cultural prosperity in forest-dependent economies, and as such they constitute an important strategy for fostering prosperity. However, SMFEs face a number of barriers and challenges, including inhospitable or incompatible regulatory environments, difficulties achieving economies of scale, and insufficient access to technical and financial capacity to overcome these issues. Through a comprehensive literature review of scholarly research published on the subject of SMFE failures and successes, our study addressed the following question: what political, economic, and socio-cultural conditions are needed for SMFEs to thrive? In answering this question, we identified and characterized twelve (12) emergent critical success factors (CSFs) of enabling business environments: macroeconomic setting, regulatory frameworks, forest law enforcement, tenure and ownership rights, management and land use planning rights, markets, natural capital, financial capital, forest management capacities, business management capacities, organizational capacities, and clustering. The integrative enabling environment framework proposed in our study can be used as a tool by practitioners seeking to promote SMFEs through programs of support or policy reforms. By considering the various CSFs that act as the foundation for successful SMFE development, the efficacy of forest-dependent livelihood interventions aiming to achieve prosperity around the world can be meaningfully enhanced. •Individual small and medium forest enterprises (SMFEs) need external and internal critical success factors (CSFs) to thrive•External CSFs: macroeconomics, regulations, law enforcement, tenure, management rights, markets, and natural capital•Internal CSFs: financial capital, forest management, business management, organizational capacities, and clustering•CSFs have varying interplaying roles and impacts depending on context, and can be put in place by a wide array of actors•Collectively, they allow SMFEs to be pathways to prosperity for forest-dependent communities in developing countries