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Identifying drivers and barriers for market growth within the industry producing wooden multi-family houses: Land allocation process for future growth
Linnaeus University, Faculty of Technology, Department of Mechanical Engineering. (Industriell ekonomi, Industrial Engineering)
2019 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

At present, Sweden is experiencing a housing shortage, which Swedish authorities expect to continue until at least 2025. Producers of wooden multi-family houses have a relatively small market share compared to those who use traditional building materials. Limited ability to meet the increased building demand restricts possibilities for development regarding innovation, bio-economy and sustainability.

 

Swedish municipalities are responsible for planning the building development in their regions based on their projected requirements and strategies. Combining this with a desire to develop sustainable building solutions based on wood increases complexity in the public procurement process. Currently, public building developments are achieved through the Public Procurement Act or land-allocation activity, depending on the development strategy. This normally involves developing local strategies regarding, e.g. design, material choice and geographical development. Identifying drivers and barriers in the industry and market enables improved market entry activities related to public building initiatives using wood-based solutions. Hence, improving transparency in land-allocation activity generates possibilities for companies to respond successfully to requests from municipalities. This knowledge is used to better understand the required strategic development for companies, the government and municipalities to increase use of sustainable building materials such as wood in Swedish multi-family housing projects.

 

Results show that the industry experiences barriers associated with municipalities' actions and knowledge related to wood as a building solution. Further, concrete’s strength as a building material is an issue, since municipalities tend to opt for familiar solutions. Furthermore, the way in which municipalities manage land-allocation activity is perceived as insufficient, with limited information, a subjective evaluation process, and uncertainties regarding their roles in the process. These factors contribute to ambiguity and sub-optimisation for developers proposing wood-based building solutions.

Abstract [sv]

Sverige är just nu inne i en bostadskris som enligt de svenska myndigheterna förväntas fortsätta fram till 2025. Tillverkare av flerfamiljshus i trä har en relativt liten marknadsandel jämfört med de traditionella byggnadsmaterialen. Den begränsade byggkapaciteten av träbyggnation hindrar även möjligheterna till innovation, bioekonomi och hållbarhet med fokus på miljömässiga och hållbara byggnadsmetoder.

 

Svenska kommuner ansvarar för att planera en lämplig bostadsutveckling som bygger på krav och strategier i relation till bostadsförsörjningsplanen. Komplexiteten ökar när man kombinerar den ökade efterfrågan med en önskan att utveckla hållbara byggnadslösningar baserade på trä, vilket för närvarande uppnås genom offentlig upphandling eller markanvisning beroende på kommunens utvecklingsstrategi. Detta kan även inkludera lokala strategier beträffande t.ex. design, materialval och geografisk utveckling. Genom att analysera industrins drivkrafter och barriärer kan förbättringsfaktorer identifieras och kunskap om dessa kan bidra till en marknadsutveckling av träbyggnation relaterat till kommunernas behov av bostadsförsörjning. En ökad tydlighet medför förbättrade möjligheter för företag att framgångsrikt svara på kommunernas förfrågan gällande bostadsutvecklingsprojekt. Denna kunskap kan även användas av företagen, regeringen och kommunerna för att bättre förstå det strategiska utvecklingsbehovet relaterat till hållbart byggande av flerfamiljshus med trästomme.

 

Resultaten i denna avhandling visar att industrin upplever hinder som hör samman med kommunernas agerande och dess kunskapsnivå avseende till träbyggnadslösningar. Den nuvarande marknadsdominans för betong som byggmaterial är ett problem då kommunerna ofta tenderar att välja välkända lösningar. Industrin upplever att kunskapsnivån bland de kommuner som hanterarar markanvisningar är otillräcklig, med subjektiva bedömningar av de presenterade byggnadslösningarna, samt kombinerat med otydliga roller inom markanvisningsprocessen. Dessa faktorer bidrar till osäkerhet och suboptimering för de byggherrar som föreslår en bygglösning baserat på trä.

Place, publisher, year, edition, pages
Växjö: Linnaeus University Press, 2019. , p. 187
Series
Linnaeus University Dissertations ; 345
Keywords [en]
Wooden multi-family houses, Industry structure, Land allocation activity, Public procurement process, Company drivers, Market barriers.
National Category
Other Mechanical Engineering
Research subject
Technology (byts ev till Engineering), Forestry and Wood Technology
Identifiers
URN: urn:nbn:se:lnu:diva-84503Libris ID: z86dn7ppwwhjd0szISBN: 978-91-88898-42-5 (print)ISBN: 978-91-88898-43-2 (electronic)OAI: oai:DiVA.org:lnu-84503DiVA, id: diva2:1319790
Public defence
2019-08-28, N1017, Växjö, 10:00 (English)
Opponent
Supervisors
Available from: 2019-06-04 Created: 2019-06-03 Last updated: 2019-08-30Bibliographically approved
List of papers
1. Assessing corporate economic distress: a study of the wood construction industry
Open this publication in new window or tab >>Assessing corporate economic distress: a study of the wood construction industry
2017 (English)In: Pro Ligno, ISSN 1841-4737, E-ISSN 2069-7430, Vol. 13, no 4, p. 594-601Article in journal (Refereed) Published
Abstract [en]

Wood buildings are considered as a viable option to support the effort minimizing the current housing shortage in Sweden. Companies trying to develop into this industry are needed to increase the use of prefabricated wooden elements, volumes or modules in an industrialized way. Suitable companies to make this development could be found amongst firms producing wooden single-family houses. These companies currently act on a highly competitive market with many companies offering relatively homogeneous products or services. Therefore, differentiation towards the wooden multi-family house industry could be considered as a long-term strategy, minimizing the economic distress and improving the survival of the company.The study is aiming at describing the development of economic distress and market concentration ratio in the Swedish industry for wooden single-family houses, for an eleven-year period from 2005 to 2015. The companies could be helped to understand, if and how the market concentration ratio and the economic distress are connected, linking company size to economic stability and efficient resource utilization. This will be conducted by applying Altman’s Z’-score model, grouping firms into a risk, a grey or a safe zone, combined with calculating the industry structure by means of the concentration ratio model. The required data were collected from the annual reports of the 51 relevant firms in the industry.

Place, publisher, year, edition, pages
PRO LIGNO Foundation, 2017
National Category
Wood Science Building Technologies
Identifiers
urn:nbn:se:lnu:diva-69660 (URN)
Projects
wooden single-family houses; industry structure; concentration ratio; economic distress; Z-score model; wooden multi-family houses.
Available from: 2018-01-10 Created: 2018-01-10 Last updated: 2019-09-06Bibliographically approved
2. Identifying drivers facilitating product development within the industry for wooden multi-family houses
Open this publication in new window or tab >>Identifying drivers facilitating product development within the industry for wooden multi-family houses
2017 (English)In: Pro Ligno, ISSN 1841-4737, E-ISSN 2069-7430, Vol. 13, no 4, p. 602-609Article in journal (Refereed) Published
Abstract [en]

Sweden is forecasted to grow its population with 1.1 million people over the next eight-year period, increasing the demand on the construction phase of housing units throughout Sweden. However, at present, 240 of Sweden's 290 municipalities show an existing deficit of available housing units in their regions, resulting in inherent difficulties fulfilling this demand utilizing the current production structure. Therefore, further utilizing wood as a building material could contribute to minimize the gap, as well as fulfilling the EU’s goals towards the Europe 2020 strategy and the EU forest strategies, focusing on development towards innovation, bio-economy, sustainable sourcing and use of raw materials. This study is aiming to identify drivers supporting the Swedish industry of wooden multi-family houses to enable market growth through competitive and sustainable strategies. The representatives within the building process identify drivers, how they perceive their effect on the companies’ abilities to develop based on long-term and short-term strategic impact. Thus, the goal is to find ways in which wooden multi-family houses could compete as a building solution, compared to established solutions, thereby increasing the market share in Sweden. The methods used in this study is surveys distributed to representatives from municipalities, developers, contractors, architects and real estate companies.The result identifies three change drivers influencing the industry development for wooden multi-family houses in Sweden: technological-, knowledge- and environmental- drivers. These drivers have an effect on the companies’ ability for successful new product development and for development of sustainable strategies towards market growth for wooden multi-family houses.

Place, publisher, year, edition, pages
PRO LIGNO Foundation, 2017
Keywords
industry drivers; wooden multi-family houses; sustainable development; competitive advantage; new product development.
National Category
Wood Science Building Technologies
Identifiers
urn:nbn:se:lnu:diva-69659 (URN)
Available from: 2018-01-10 Created: 2018-01-10 Last updated: 2019-09-06Bibliographically approved
3. Identifying market mobility barriers for wooden single-family house producers to enter the multifamily segment
Open this publication in new window or tab >>Identifying market mobility barriers for wooden single-family house producers to enter the multifamily segment
2018 (English)In: Social Influences, Forest Products Society, 2018Conference paper, Published paper (Refereed)
Abstract [en]

In the past decades, the housing shortage in Sweden accumulated to a level that led to acute problems for many people combined with continuously rising housing prices. The market for single-family houses, where wood dominates with 85 – 90 % of market share, is highly competitive with many companies offering relatively similar products or services. To serve the demand on that market, only 38 % of the existing companies were needed. One way to tackle the existing housing shortage, and to develop new business opportunities, could be to get more companies from the single-family house industry to produce multi-family houses. Current competence in prefabricated house production could be utilised, yet, other areas could act as barriers for these companies. The aim of this study is to identify potential market mobility barriers for Swedish companies currently producing wooden single-family houses to develop towards the construction of multi-family houses. This will be conducted by initial interviews with decision makers in those companies, combined with a survey-study covering companies within the industry. The results show that the main market mobility barriers are related to the strong market presence of traditional building materials, lack of knowledge by the market of wood as a suitable building material and the importance of governmental guidance and actions.

Place, publisher, year, edition, pages
Forest Products Society, 2018
Keywords
Wooden single-family houses, Market mobility barrier, Wooden multi-family houses, Industry analysis, Market development strategies.
National Category
Other Engineering and Technologies not elsewhere specified
Identifiers
urn:nbn:se:lnu:diva-76230 (URN)
Conference
Forest Products Society 72nd International Convention - Forest Products: Key To A Sustainable Future,June 11-14, 2018, Madison, USA.
Note

Ej belagd 180903

Available from: 2018-06-20 Created: 2018-06-20 Last updated: 2019-06-03Bibliographically approved
4. Barriers in the Public Procurement Process: Restricting Long-Term Sustainable Construction of Wooden Buildings
Open this publication in new window or tab >>Barriers in the Public Procurement Process: Restricting Long-Term Sustainable Construction of Wooden Buildings
2019 (English)In: Scandinavian Journal of Public Administration, ISSN 2001-7405, E-ISSN 2001-7413, Vol. 23, no 2, p. 13-32Article in journal (Refereed) Published
Abstract [en]

The municipalities control the planning of new housing projects in Sweden, basing their decisions on the general requirements and future strategic expectations. The activity is managed through the Public Procurement Act or the land allocation process depending on their development strategy. It involves the development of local strategies regarding design and geographical development, as well as the development of suitable procurement methods. Therefore, having the ambition to develop sustainability by increasing the use of wood building solutions imposes new challenges on the procurement process performed by municipalities in Sweden. The aim of this study is to identify ways to overcome barriers in the public procurement process for new building developments based on land allocation projects managed by Swedish municipalities, enabling an increase in wooden multifamily houses in Sweden. The study is based on direct participation at a municipality performing this activity, combined with interviews including municipalities and developers involved in the procurement process using land allocation. The result shows discrepancies in how the municipalities and developers perceive the land allocation activities. Furthermore, national standards, equal evaluation methods and a defined procurement process have been identified as drivers towards an efficient activity, which currently acts as a barrier to the development of wooden multifamily houses.

Place, publisher, year, edition, pages
School of Public Administration, 2019
National Category
Other Mechanical Engineering Public Administration Studies
Research subject
Technology (byts ev till Engineering), Industrial economy
Identifiers
urn:nbn:se:lnu:diva-85341 (URN)
Available from: 2019-06-14 Created: 2019-06-14 Last updated: 2019-08-27Bibliographically approved

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Doctoral Thesis (Comprehensive Summary)(9196 kB)104 downloads
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