Entrepreneurship in the Pulp and Paper Industry: A Research Report

This research report explores the landscape of entrepreneurship within the pulp and paper industry. It begins with a description of the industry, detailing its evolution and current challenges, including the shift towards digitalization and environmental concerns. The report then identifies significant issues faced by entrepreneurs in this sector, such as capital intensity, government regulations, technological advancements, and competition from digital alternatives. It analyzes the level of entrepreneurial activity, noting the capital-intensive nature of the industry and the limited scope for innovation, which discourages new ventures. Furthermore, the report outlines key factors influencing the probability of success for new ventures, including innovative ideas, strong leadership, effective teams, adequate capital, and strategic planning. The report concludes by summarizing the key findings and emphasizing the complexities and challenges inherent in the paper industry.

Research Report
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Table of contents
Introduction ....................................................................................................................................3
Description of industry sector .........................................................................................................3
Coverage of significant issues facing entrepreneurs in the sector ..................................................4
Discussion on level of entrepreneurial activity in the sector ..........................................................5
Factors which influence the probability of new venture success ...................................................6
Conclusion ......................................................................................................................................8
References .....................................................................................................................................9
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Introduction
In the modern world, papers serve as a major need of people. From newspapers to shopping bags
all are produced under one roof. Therefore the report has taken up this specific industry to be the
centre of the project. The following research report includes a description of the pulp and paper
industry, some significant issues that entrepreneurs face in this sector, discussion on level of
activity of entrepreneurs in this sector and lastly the factors that influence probability of new
venture success.
Description of industry sector
Papers used to be an integral part of human living at a certain period. But unfortunately now the
industry is facing some problems in retaining the profit margins due to the limited use of paper.
The pulp and paper industry uses wood as the raw material and produce pulp (the fibrous
material prepared by chemically or mechanically separating the cellulose from the wood), paper
and other products that are cellulose based products (Kantur, 2016). The pulp is fed in the
machine where it forms a paper web and the water is removed by pressing it hard and drying it
using air or heat.
Papers started to evolve in the early 6th century and saw its growth in the Song dynasty. Today
China is one of the biggest paper producing industry. Though papers are an integral part of our
living the environmental factors have squeezed down the use of it largely in recent times (Stam
& Spigel, 2016). The government is on high alert and has restricted deforestation as this is a
serious issue. The clear-cutting has made things to a dip though the industry can maintain with
the help of forest management and afforestation.
Coverage of significant issues facing entrepreneurs in the sector
Every entrepreneur faces issues that are common to each and every business. These issues are as
follows:
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· Developing a unique vision and business idea
· Raising capital and finding investors for the business
· Finding the appropriate location for the business
· Assembling a great team for the business
· Finding the perfect employees
· Facing unforeseen challenges and expenses
· Dealing competition
· Keep up with trends in the market
· Determine exit strategy
· Dealing with overconfidence
· Having a passion and purpose for the business
· Keep calm and focus
All the above mentioned are the issues which are common to every entrepreneur but in addition
to these the particular industry, burden the shoulder of the entrepreneur significantly. The issues
for an entrepreneur in the paper industry are a little different (Stam & Spigel, 2016).
Initially the paper industry was a slow labor-intensive process but now it is a capital-intensive
process with high tech machines. Millions of people use paper daily but the government is
pressurising the industry to tap down the production as it effects the global resource and bio
economy (Acs et al., 2016). Breakthrough technologies needs to be employed and updated at
minimal intervals to reduce water consumption and heat generation. Paper is the one thing that is
highly recyclable but with modern technology and appliances people are deviating and reading
from mobile phones, kindles etc. Increased DE carbonisation and energy efficiency is another
issue to be faced in the industry. The printing is also a concern as the ink is costly and the
demand for raw materials such as wood and cascading the use of woods is another challenge.
Again the export duties and taxes for wood and the always increasing fuel prices are another
issue for the entrepreneur (Simón-Moya, Revuelto-Taboada & Ribeiro-Soriano, 2016). The use
of chemicals and acids are a concern for the biosphere and are limited for the use. These are
some significant issue that an entrepreneur have to face in the paper industry. Summarising the
facts, other than the basic issues to be handled there are a lot more issues to be faced in the pulp
and paper industry.
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Discussion on level of entrepreneurial activity in the sector
In the era of digitalisation people are inclined towards reading newspapers from appliances than
from newspapers, use plastic bags for packing material (though it is getting restricted nowadays)
which restricts the use of paper. Though some things such as currency notes, paperboards will
maintain its presence in the near future. Therefore the entrepreneurial activities are limited in this
sector as they know it is a capital-intensive industry with limited room for innovation. On top of
that the expenses are huge but the profit margins are low. Saving the bio economy is the goal of
people and it requires least natural resource consumption which is a tough job in the paper
industry (Boschma, 2015). The government de-escalate the use of natural resources by renewing
laws. Additionally, people are aware that the bio economy is hampered by extensive use of the
natural resources therefore, they are preferring digitalised paper.
Entrepreneurial activities are high in those sectors where there is a scope for value addition to the
business. This industry is a place where there is least scope for improvement, investments are
high compared to the returns. This is one of the most risky industry in the current generation and
therefore entrepreneurs fear in venturing the same (Lazzarini, 2015). Until there is a solid
technology and great idea to excel, stepping in the industry is a huge risk with an expectation of
debts and loss. Therefore the entrepreneurial activities are least in the sector and people dread in
venturing into the same.
Factors which influence the probability of new venture success
The first few years are especially difficult for an entrepreneur as the expected and unexpected
challenges all comes in a wave. In spite, behind the success stories, there ought to have the
following factors which are strong and saves the business in most difficult conditions.
· An innovative idea: It is a universal fact that in the long run the most innovative and
unparalleled ideas get the credit and earns popularity (Pätäri et al., 2016). Being most
unique can make it stand high alone in the market, though substitutes may interfere.
· Inspiring leadership: The goals and visions are set by the leader and an influential, skilled
leader will help and guide the team to perform best in the market. The wise and effective
decision maker always outperforms.
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· Best team: When entrepreneurs deliver ideas, teams accomplish the ideas fighting all
kinds of challenges. The most responsible people having innovation and ability to
perform comprise the best team.
· Capital: When it comes to startups and ventures investment is one of the main factors as
investors criticise every nook and corner of the venture to employ their resources (Jolly &
Raven, 2015). Though risk is associated even after having investment as one wrong move
can ruin the whole plan.
· The foolproof plan: Just delivering the idea is not the end of the game. The whole process
needs to be blueprinted in order to make things go smoothly (Yang & Danes, 2015).
Goals, operations, supplies, workforce employment and challenges needs an extensive
research to tune things correctly in future.
· The perfect execution: Writing down the plans and executing them are two whole
different stories. Perfectly executing the plans can serve being a challenge. When these
challenges overcome in the best ways success begins.
· Timing: The time for entry of the venture is the most important thing amongst all the
factors. The best time would be the critical moment when the idea and its execution is
most required in the market.
· Response to crisis situations: Every business face a crisis at any point of time and the
kind of response the entrepreneur gives decides the future of the company. Fighting the
crisis situations effectively is the best way to overcome for gaining success (Jin et al.,
2017).
· Marketing: Another key factor that boosts the business all the time. The way products are
marketed is the spell for attraction of public which affect their buying decisions. Sales
can grow even if the products are standard and marketing or branding is unique and
exciting for the prospect buyers.
· Growth: A moderate growth graph play a significant role in the story of ups, downs and
eventually the end of the business. Therefore too fast or to slow growth is not the ideal.
The above mentioned factors though are jotted and planned by the entrepreneur, there may be
situations where the plans and the knowledge fail (Ughetto, 2016). Those situations require more
attention and instant presence of mind to fight and overcome. The more effective ways can make
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things grow and reach a different level for the business. Along with that the experience makes
extension of knowledge for the leaders.
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Conclusion
The project has briefly discussed the factors that are directly associated with the entrepreneurship
in the pulp and paper industry. The description of the industry deals with a concrete discussion
on the making process and evolution of the industry. Next are the issues that entrepreneurs face
in order to keep pace in the industry. Again the level of activities that entrepreneurs have in this
industry and the reason for such activities and lastly the factors that influence the success of a
new ventures.
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References
Acs, Z. J., Audretsch, D. B., Lehmann, E. E., & Licht, G. (2016). National systems of
entrepreneurship. Small Business Economics, 46(4), 527-535.
Boschma, R. (2015). Do spinoff dynamics or agglomeration externalities drive industry
clustering? A reappraisal of Steven Klepper’s work. Industrial and Corporate Change, 24(4),
859-873.
Jin, L., Madison, K., Kraiczy, N. D., Kellermanns, F. W., Crook, T. R., & Xi, J. (2017).
Entrepreneurial Team Composition Characteristics and New Venture Performance: A Meta–
Analysis. Entrepreneurship Theory and Practice, 41(5), 743-771.
Jolly, S., & Raven, R. P. J. M. (2015). Collective institutional entrepreneurship and contestations
in wind energy in India. Renewable and Sustainable Energy Reviews, 42, 999-1011.
Kantur, D. (2016). Strategic entrepreneurship: mediating the entrepreneurial orientation-
performance link. Management Decision, 54(1), 24-43.
Lazzarini, S. G. (2015). Strategizing by the government: Can industrial policy create firm‐level
competitive advantage?. Strategic Management Journal, 36(1), 97-112.
Pätäri, S., Tuppura, A., Toppinen, A., & Korhonen, J. (2016). Global sustainability megaforces
in shaping the future of the European pulp and paper industry towards a bioeconomy. Forest
Policy and Economics, 66, 38-46.
Simón-Moya, V., Revuelto-Taboada, L., & Ribeiro-Soriano, D. (2016). Influence of economic
crisis on new SME survival: reality or fiction?. Entrepreneurship & Regional
Development, 28(1-2), 157-176.
Stam, F. C., & Spigel, B. (2016). Entrepreneurial ecosystems. USE Discussion paper
series, 16(13).
Ughetto, E. (2016). Growth of born globals: the role of the entrepreneur’s personal factors and
venture capital. International Entrepreneurship and Management Journal, 12(3), 839-857.
Yang, Y., & Danes, S. M. (2015). Resiliency and resilience process of entrepreneurs in new
venture creation. Entrepreneurship Research Journal, 5(1), 1-30.
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