Commonality of machine centers: Opportunities for product line extension

Document Type

Article

Publication Date

5-1-2007

Abstract

Comparative analyses of wood products manufacturing groups based on machinery and equipment are important to the growth of U.S. wood products manufacturers. Observed commonalities of machine centers between industry and product segments present an opportunity for manufacturing businesses to grow by extending their product lines. A company could enhance its market presence by introducing products that are technologically unrelated to the existing product line but that can be manufactured by leveraging existing machine technology. In this way, manufacturing businesses may achieve economies of scope as they seek to enhance their competitive stance. We examined the degree of commonality in machine use between six industry segments in the Louisiana wood products industry in 2005 to identify opportunities for line extension and analyzed the association between machine use and economic outcomes within industry segments. We found that eight specific machines were listed as the most commonly used across product categories. There was strong commonality in the use of machines between certain product segments, and significant differences between other segments. Within product segments we observed differences in machine use based on company size. We discovered a disparity between a ranking of most commonly used machines and those that were most significantly associated with sales classes within industry segments. This study provided insights into how training and development programs for the value-added industry sector might be effectively structured. This study also provides decision support for integrating machine technology into businesses in a way that creates additional value. © Forest Products Society 2007.

Publication Source (Journal or Book title)

Forest Products Journal

First Page

41

Last Page

49

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