H I L 3C GEORGIA FOREST RESEARCH PAPER 36 JUNE, 1982 A SURVEY OF FOREST PRACTICE VENDORS AND SERVICES IN GEORGIA BY ALBERT A. MONTGOMERY " ClORCIA " FORESTRY RESEARCH DIVISION Received MAY 30 1988 DOCUMENTS UGA LIBRARIES GEORGIA FORESTRY COMMISSION AUTHOR *M * Albert A. Montgomery, Ph.D. Senior Research Associate Contract Research Division Office of Services School of Business Administration Georgia State University. ACKNOWLEDGMENT The author is indebted to Mr. James D. Strange, Professor Robert L. Chaffin, and Dr. James E. Morrow who helped design the survey, and the many staff members of the Georgia Forestry Commission who did the field work and interviews. A SURVEY OF FOREST PRACTICE VENDORS AND SERVICES IN GEORGIA BY ALBERT A. MONTGOMERY While the outlook for the Georgia forest economy is generally optimistic, there is concern about the future adequacy of the pine timber supply. Even though the forest products industry will soon achieve a high level of sustained timber production on land it manages as pine plantations, the continued growth of the industry's manufacturing capacity is becoming increasingly dependent upon the future timber supply from private, nonindustrial landowners. Reflecting this, the market economy is currently calling for substantial annual investments in reforestation and improvements of existing pine timber stands found on non-industrial land. But the an- nual rate of improved forest management actually being accomplished by non-industrial landowners in Georgia is falling short of the economic potential. Consequently, the industry's continuing investments in capacity expansion are being subjected to an increasing risk of an inadequate future timber supply. If Georgia's forest economy is to con- tinue growing, non-industrial landowners must improve their existing timber stands and increase reforestation efforts. One of the main purposes of this survey is to focus on the extent of the forest management shortfall on Georgia's nonindustrial timberland. The study finds that Georgia's non-industrial landowners have been more responsive to the market opportunities for forest investment than has been generally believed particularly with respect to reforestation. In 1979, Georgia's non-industrial land- owners reforested some 58,000 acres to pine. But this substantial accomplishment was less than a third of the pine reforestation acreage that is annually justified by the market economy. Moreover, there is a greater lack of accomplishment in needed timber stand improvement and prescribed burning work. A second major purpose of the study is to determine whether this management shortfall is due to a shortage of forest practice vendors, equipment, labor, and other resources with which to do the job for non-industrial landowners. The study shows that the current situation in the vendor industry results in many problems for the individual landowners, especially in the state's Upper Piedmont and Mountain Regions. Unless the landowners are being assisted by a consulting forester or state service forest- er, vendors can be hard to find. Relatively few vendors advertise their forest practice services through the public media. If a landowner can find a vendor, not infre- quently, he may find that the vendor has gone out of business, or is inactive. Or, the landowner may be able to get his land site prepared, but can't find a vendor to plant the land or vice versa. But what the individual landowner is not apt to perceive is that his problems with the forest practice vendor industry are due largely to the fact that landowners generally are not giving forest practice vendors enough work. In 1980, 330 forest practice vendors listed themselves with the Georgia Forestry Commission. By the time this survey was taken in the winter of 1980-81, 55 of these firms were inactive or out of business. The lion's share of forest practices is being accomplished by a handful of large vendors while the large majority of vendors have very little work to do. This results in an under-utilization of the vendors' equip- ment and men. This creates labor and financial problems for the individual vendor that are reflected in the vendor's availability to perform forest practices and in performance quality. Therefore, the forest economy of Georgia does not have a problem with the forest practice vendor industry in general. This study concludes that the forest practice vendor industry must be count- ed among the major competitive advan- tages that favor continued growth of Georgia's forest economy. The survey solicited the opinions, not only of vendors, but of state foresters, private consulting foresters, and industry foresters, who work daily with non-indus- trial landowners and vendors. In the opinion of the large majority of these experts, the management shortfall, on nonindustrial land, is due mainly to a lack of landowner demand. It is the concensus of opinion that the supply of forest practices could be increased significantly if the market for these services was better organized and more stable. In support of these opinions, the study shows that the vendor industry could have reforested al- most as much additional acreage in 1979, with its existing personnel and equipment, as was actually accomplished on non-industrial land in that year. This ex- cludes the many part-time and inactive vendors who were not surveyed. A capa- city exists, as well, to perform more acreage of timber stand improvement and prescribed burning on a smaller scale. This abundance of real economic resources to do the job is explained, partly, by the fact that it is a legacy of the extensive landscape changes that have occurred in Georgia over the past 20 years. The investment in equipment, labor, and know-how for road construction, pond building, and land clearing for utility rights-of-way, agriculture, home sites, shopping centers and the like can be applied in site preparation work now that these original purposes are less demanding. The abundance of tree planting vendor resources is explained by the fact that Georgia's forests are intermingled with an agricultural economy that gives forestry the advantage of a local infrastructure of roads, equipment serving businesses, and labor but does not seriously threaten the use of the land for forestry. If forest management shortfall is due primarily to a lack of landowner demand, what are the reasons for it? What will it take to overcome the lack of will to make profitable investments? In the opinions of the foresters and vendors surveyed, the lack of landowner demand is primarily tied to investment cost. What would it take to increase landowner demand for improved forest practices? About a third of the foresters and vendors were of the opinion that higher stumpage prices would be necessary. But, the majority of both foresters and ven- dors indicated that further public initia- tive would be necessary, either by tax incentives or public sharing of the forest investment cost. These survey findings raise the question as to whether the public can afford the investment costs of substantially eliminating the management shortfall. First, while the individual landowner must wait a minimum of 15 years for the personal economic benefit from planting seedlings, there is an immediate economic benefit for the public. It gives industry the assurance of a future timber supply. Without this assurance, industrial invest- ments will not be made that are necessary to increase productivity, job opportunities, and income. Without continued industrial investment in new, more productive manufacturing capacity, forest products will cost more. Stumpage prices, timber transportation, lumber, paper, and paperboard manufacturing costs will be higher unless the forest management shortfall is substantially reduced. Thirdly, the real economic cost to the public would be much less than expected and non-inflationary in its impact on the economy. The resources to do the job already exist, and are substantially underemployed. Georgia's forest practice vendor industry has trained operators and equipment for the work. Planters and labor are there to plant on a scale comparable to that of the Soil Bank Program days. As a legacy of that earlier program, there exist state and industrial nursery facilities to supply genetically superior seedlings on a much larger scale than at present. The real cost of doing the job would be marginal to the public. The public outlays would be partly offset by savings in the rural cost of unemployment and poverty programs. The public economic benefit would be immediate and substantial while the public economic cost would be minimal. FOREST PRACTICES ACCOMPLISHED ON GEORGIA'S NON-INDUSTRIAL LAND The acreage of site preparation, planting, timber stand improvement (TSI), and prescribed burning accomplished in 1979 on Georgia's non-industrial timberland have been estimated from the survey re- sponses. Some non-industrial landowners may have accomplished management practices without forester assistance, and some practices will have been arranged by con- sultants who did not participate in the survey. This method of estimation has been checked against the reported acreage of practices accomplished by vendors participating in the survey. A total of 52,469 acres of site prepara- tion, 57,559 acres of planting, 16,327 acres of TSI, and 67,280 acres of prescribed burning were arranged by these foresters statewide (Table 1). REFORESTATION OF NON-INDUSTRIAL LAND-ACTUAL VERSUS POTENTIAL The planting of 57.6 thousand acres of non-industrial land in 1979 was a considerable accomplishment, but much less than needed. As existing stands of pine forest type are cutover, 180,000 acres of non-industrial land would be economically feasible for planting each year and some 70,000 acres could be annually regenerated with seed trees. Under recent market conditions, the planting of Georgia's non-industrial land in 1979 was only 32 percent of the economically feasible annual rate (Table 2). In contrast, it is estimated that industry's planting of land it manages in Georgia is proceeding at an annual rate that is slightly higher than would be necessary to sustain a plantation economy on 3.5 million acres of industry's pine land. Bas- ed on reported seedling use, industry planted from 100,000 to 120,000 acres in 1979 on land it owns or holds under longterm lease. This compares with a long-run annual potential of 95.2 thousand acres at recent stumpage prices and manage- Geographic boundaries GEORGIA SURVEY REGIONS Table 1 Forest Practices Arranged For Georgia's Nonindustrial Landowners in 1979 by Responding State Service Consulting, and Industry Foresters, By Region Region Site Preparation Acres (%) Planting Acres (%) Timber Stand Improvement Acres (%) Coastal Lower Piedmont Upper Piedmont-Mountain State 36807 11669 3993 52469 ( 70.1) ( 22.2) ( 7.6) (100.0) 36466 15900 5193 57559 ( 63.4) ( 27.6) ( 9.0) (100.0) 5827 4577 5923 16327 ( 35.7) ( 28.0) ( 36.3) (100.0) Prescribed Burn ing Acres (%) 43242 15791 8247 67280 ( 64.3) ( 23.5) ( 12.3) (100.0) State Estimated Percentage Work Done By Vendors (V) and By Landowners (LO) Site Prep. V-LO 96%-4% Planting V-LO 92%-8% TSI V-LO 85%- 15% Pres. Bum V-LO 77%-23% Table 2 Georgia's Reported 1979 Planting Versus Long-Run Economic Potential Reported Planting Acres Potential Planting Acres Reported/ Potential % Nonindustrial Land Coastal Lower Piedmont Upper Piedmont State 36466 15900 5193 57559 105400 46200 28500 180100 34.6 34.4 18.2 32.0 Industry Land State 100,000-200,000 95200 100.0+ Public Land State 5000+ 11700 42.7+ Reported nonindustrial planting from Table 1. Estimated industry planting from Southern Forest Institute seedling reports. Public planting as reported on National Forests. "Potential Planting estimated from economic model at recent market prices and management costs. Southeast Forest Resource: An Econo- mic Outlook , Montgomery, Robinson, and Strange. Table 3 Opinions Which Of The Following Is The Main Reason Why More Improved Forest Practices Are Not Being Accomplished On Nonindustrial Land In Georgia? Lack of Landowner Demand For Practices Or Lack of Vendors To Supply Practices Coastal Lower Piedmont Upper Piedmont And Mountain State Foresters % Vendors % Foresters % Vendors % Foresters % Vendors % Foresters % Vendors % Demand Supply No Responses Total Responses (No.) 73.1 25.0 1.9 100.0 52 87.5 5.6 6.9 100.0 72 72.7 24.2 3.0 100.0 33 90.9 9.1 0.0 100.0 33 69.8 23.2 7.0 100.0 43 93.7 6.2 0.0 100.0 32 72.3 23.8 3.8 100.0 130 89.8 6.6 3.6 100.0 137 Includes Out-Of-State Responses ment costs. As industry is cutting over existing stands of pine on land it man- ages, it is reforesting all of that land which has the potential of yielding a higher investment return from forestry than can be earned elsewhere in the economy. OPINIONS OF FORESTERS AND VENDORS Question 2. What are the major reasons for the lack of non-industrial landowner demand for im- proved forest practices? Foresters and vendors were given a choice of potential reasons for the lack of landowner demand, but were asked to volunteer their own reasons as well, rank- ing each reason in importance on a scale of one being the most important, two the next more important, and so on. Each respondent was asked the following questions concerning landowner requests for and vendor availability for forest management services. Question 1. Is it the lack of non-industrial landowner demand for improved forest management or the lack of vendors to per- form the management that is the main reason why more management is not being accomplished? Of 130 state service foresters, private consulting foresters, and industry foresters surveyed statewide, 72.3 percent responded that it was a lack of landowner demand, 23.8 percent that it was a lack of vendors, and 3.8 percent did not respond (Table 3). Lack of Dependable Vendors Only 3.1 percent of service, consulting and industry foresters responding statewide ranked lack of dependable vendors as No. 1 in importance, and only 12.7 percent ranked it as high as No. 2 in importance (Table 4). Can't Afford the Investme nt Cost Statewide, 68.7 percent of the vendors and 48.1 percent of the foresters ranked this reason as the most important. Lack of Knowledge or Interest in Economic Opportunities That landowners are not interested in the economic opportunities of improved forest management, or are simply unaware of those opportunities, was cited as the most important reason for the lack of landowner demand by 29.5 percent of the foresters and 19.8 percent of the ven- dors. Holding Land for Potential Non-Forest Uses That non-industrial landowners might be holding their land for real estate speculation, conversion to agricultural use, wildlife and recreational use was not frequently cited as the main reason for the lack of landowner demand for forest practices. Unwillingness to Bear Risks Neither foresters nor vendors very frequently cited landowner unwillingness to bear the risks of forestry (e.g. fire, insects, and diseases) as being No. 1 in importance. Other Reasons Virtually none of the vendors volunteered other reasons which they consider Table 4 Opinions What Are Major Reasons For Lack of Nonindustrial Landowner Demand For Improved Forest Practices? Percent of Responses Ranking No. 1 and No. 2 Respondents Coastal % of 1 's/2's Lower Piedmont % of 1 's/2's Upper Piedmont And Mountain % of 1 's/2's 1 State % of 1's/2's Lack of Knowledge or Disinterest in Economic Opportunities Foresters Vendors 34.6/28.8 19.7/30.7 30.3/25.8 15.2/48.4 23.8/28.6 25.0/25.0 29.5/28.6 19.8/33.6 Unwillingness to Bear Risks (e.g. Fire, Insect, Disease) Foresters Vendors 1.9/17.3 3.0/27.7 0.0/22.6 9.1/12.9 0.0/14.3 0.0/12.5 0.8/17.5 3.8/20.3 Can't Afford Investment Cost Foresters Vendors 51.9/28.8 71.2/20.0 57.6/22.6 72.7/16.1 35.7/28.6 59.4/31.2 48.1/27.0 68.7/21.9 Holding Land for Potential Nonforest Uses Foresters Vendors 5.8/7.7 6.1/20.0 0.0/6.5 3.0/22.6 23.8/7.1 15.6/31.2 10.1/7.1 7.6/23.4 Lack of Dependable Vendors Foresters Vendors 1.9/9.6 6.1/12.9 2.4/16.7 3.1/12.7 Other Reasons Foresters Vendors 3.8/7.7 0.0/1.5 6.1/9.7 0.0/0.0 14.3/4.8 0.0/0.0 8.5/7.1 0.0/0.8 Total Responses Foresters (No. I Vendors (No.) 100.0/100.0 49/48 66 / 65 100.0/100.0 33 / 31 33 / 31 100.0/100.0 42 / 42 32 / 32 100.0/100.0 129 /126 131 /128 Includes Out-Of-State Responses Table 5 Opinions Respondents What Would It Take To Increase Nonindustrial Landowner Demand For Improved Forest Practices? Percent of Responses Ranking No. 1 and No. 2 Coastal %of 1's/2's Lower Piedmont %of1's/2's Upper Piedmont And Mountain %of1's/2's 1 State %of 1's/2's Higher Stumpage Prices Foresters Vendors 25.0/16.7 28.4/12.1 31.2/31.2 42.4/20.0 40.4/23.8 37.5/12.9 Landowner Educational Programs 31.5/22.7 34.1/14.2 Foresters Vendors 14.6/8.3 10.4/18.2 0.0/21.9 9.1/16.7 14.3/9.5 6.2/9.7 Public Timber Crop Insurance 10.5712.2 9.1/15.7 Foresters Vendors 0.0/0.0 1.5/1.5 0.0/3.1 0.0/3.3 2.4/4.8 0.0/3.2 0.8/2.4 0.8/2.4 Public Cost-Sharing Foresters Vendors 25.0/22.9 37.3/22.7 21.9/12.5 39.4/20.0 Tax Incentives 14.3/19.0 34.3/22.6 20.9/18.7 37.1/22.0 Foresters Vendors 35.4/45.8 20.9/43.9 37.5/28.1 9.1/40.0 26.2/26.2 21.9/41.9 More Vigorous Vendor Marketing 32.2/35.0 18.2/42.5 Foresters Vendors 0.0/6.2 1.5/1.5 6.2/3.1 0.0/0.0 Other Factors 0.0/9.5 0.0/9.7 1.6/6.5 0.8/3.1 Foresters Vendors 0.0/0.0 0.0/0.0 3.1/0.0 0.0/0.0 2.4/7.1 0.0/0.0 2.4/2.4 0.0/0.0 Total Responses Foresters (No.) Vendors (No.) 100.0/100.0 48 / 48 67 / 66 100.0/100.0 32 / 32 33 / 30 100.0/100.0 42 / 42 32 / 31 100.0/100.0 124 /123 132 /127 Includes Out-Of-State Responses to be important in explaining the lack of non-industrial landowner demand for for- est practices. Question 3. What would it take to in- crease non-industrial land- owner demand for improved forest practices? Higher Stumpage Prices Statewide, approximately one-third of foresters and vendors cited higher stumpage prices as the most important factor that would increase non-industrial land- owner demand for improved forest prac- tices (Table 5). There is a distinct regional pattern with the importance of higher stumpage prices increasing from south to north. This reflects the existing pattern of stumpage prices in which prices decrease from south to north. Public Cost-Sharing and Tax Incentives Jointly, these two responses accounted for more than half of the foresters' and vendors' No. 1 and No. 2 rankings as the most important incentive for increased landowner demand for forest practices. Landowner Education and Other Factors Among the remaining responses, only landowner educational programs received as much as 10 percent of the foresters' and vendors' No. 1 and No. 2 rankings. Virtually none of the foresters and ven- dors gave much importance to the idea of public timber crop insurance. Similarly, neither group foresees much being accomplished by a more vigorous marketing effort by forest practice vendors. Question 4. What would be necessary to increase significantly the availability of vendors and vendor services in Georgia? I ncreased Demand for Vendor Services Statewide, 46.3 percent of the foresters and 38.1 percent of the vendors ranked increased landowner demand as the most important factor that would lead to an increase in the availability of vendors and services (Table 6). Higher Contract Pr ices for Vendor Services Large vendors, i.e. firms site preparing or planting more than 2,000 acres in 1979, cited the need for higher prices as the most important factor more frequently than the smaller vendors, 52.2 percent 10 versus 28.9 percent. Considering the forest practice vendor industry as a whole, these findings imply that there could be a substantial supply response to an improved market for vendor services without the necessity of a higher level of forest practice vendor prices. Technical Assistance to the Vendor Virtually no vendors considered technical assistance to the vendor in running his business and performing his services as an important requirement for increasing the availability of vendors and their ser- vices. Increased Supply of Well-Qualified Labo r Obtaining and keeping skilled labor was a frequently cited vendor problem. However, relatively few vendors ranked an increased supply of skilled labor as an important requirement for expanding the supply of vendor services. Assistance in Financing Vendor Equipment Few vendors considered assistance in financing of their equipment as an impor- tant requirement for increasing the availability of vendors and services. GEORGIA'S FOREST PRACTICE VENDOR INDUSTRY Each year the Georgia Forestry Com- mission compiles a list of forest practice vendors offering their services to non-in- dustrial landowners. The list may not in- clude all vendors operating in the state, some of whom will be limiting their busi- ness to the forest products industry (Table 7). From the list of known vendors, 55 firms were found to be inactive or out of business. Sixty percent of the 275 active firms on the list were included in the survey. Forestry Commission personnel interviewed 135 vendors, and 30 consultants; out-of-state, and industry vendors returned mail questionnaires. The vendors responding to the survey include virtually all of the known larger and active vendors and a large, but not complete, representation of the small and part-time vendors. FOREST PRACTICES REPORTED BY RESPONDING VENDORS The 41,505 acres of site preparation work done by independent vendors, on land owned or leased by the forest pro- ducts industry, is consistent with the re- lative use of contractors and company personnel and equipment reported for this work (Table 8). By Vendor Size Even considering that a substantial part of the forest practice vendor industry's site preparation and planting work is for industrial customers, it is remarkable that the lion's share of all forest practice acreage is accomplished by a few large vendors (Table 9). This pattern is seen to apply to the timber stand improvement and prescribed burning practices, as well. THE ECONOMIES OF LARGE SCALE REFORESTATION The economic explanation for the distribution of acreage between large and small vendors is well-understood in the forest practice vendor industry. Large vendors do more work because they can do the work more cheaply. There are substantial economies of scale for this capital-intensive industry. The minimum equipment investment for site preparation and planting is quite large. For example, it would appear that a vendor in the Coastal Region can site prepare as much as 1,000 acres a year with the equipment that he may be using only for 100 acres or less. Thus, the equipment investment cost per acre will be much higher if he site prepares only 100 acres as compared with full utilization of that equipment on 1,000 acres. As a practical matter, the high investment cost per acre of the small vendor would appear to be less of a factor explaining his cost disadvantage relative to a large vendor than his labor costs. Among the 156 vendors who listed their equipment in the survey, 124 indicated that they owned most of their equipment. Only 12 vendors indicated they leased most or all of their equipment. If the vendor's equipment has been bought and paid for, the investment cost is a sunk cost. By the same token, the sunk investment cost of idle equipment will not be a financial burden. Unless he has the opportunity to use the equipment in non-forestry operations, the fact that he does not have enough work to fully utilize his equipment will not, by itself, force him out of the forest practice vendor business. On the other hand, while the vendor can afford idle equipment, he cannot afford idle equipment operators, including himself. It is one of the more important findings of this survey that there appear to be econ- m * f4 : This heavy piece of equipment is used to chop forest debris in a site preparation operation. omies of scale for labor as weil as equipment utilization (Table 10). While more operator time is required to site prepare and mechanically plant larger than smaller acreages, the increase in operator time and labor cost is less than in proportion to the increase in acre- age accomplished. The increase in per worker acreage appears to hold through thousands of acres and thus, the produc- tivity of labor increases even as the equipment investment and labor force is increased by additional sets of tractors, planters, and operators. POTENTIAL FOR EXPANDED FOREST PRACTICE ACREAGE One of the important conclusions of this study is that the forest practice ven- dor industry is capable of expanding its reforestation acreage more than in pro- portion to the additional equipment that would be required. It can expand its acre- age with a less than proportionate in- A crease in labor. substantial increase in reforestation acreage could be achieved with no increase in equipment investment or employment. Each vendor was asked how many additional acres of each prac- tice he could have performed in 1979 with his existing equipment and personnel (Table 11). When these acreage totals are compared with those of Table 9, the percentage increases over the acreage that was done in 1979 are found to be 58.4 percent for site preparation acreage, 36.6 percent for planting acreage, 51.7 percent for timber stand improvement acreage, and 95.1 percent for prescribed burning acreage. Even the largest vendors of each prac- tice indicated a potential for additional acreage of each practice with existing per- sonnel and equipment. However, the potential additional acreage of site preparation by the vendors over 2,000 acres in size was relatively modest in comparison with the large planting vendors. More importantly, the large site preparation vendors indicated a potential for additional acreage that was much less than the 28,550 acres indicated by the smallest site preparation vendors. These small site preparation vendors indicated that they could have worked almost four times as much acreage as they did in 1979 with the same equipment and personnel. By the same token, the smallest planting vendors indicated that they could have accomplished more than two and half times their 1979 acreage with existing equipment and personnel. MINIMUM ACREAGE FOR FOREST PRACTICES There is a concern as to whether the forest practice vendor industry is inclined to provide services to small landowners. Vendors were asked what if any mini- mum acreage was required for them to offer services within their normal operating areas (Table 12). SEASONAL AND REGIONAL AVAILABILITY OF VENDORS The monthly availability of all but site preparation vendors exhibits distinct seasonal patterns (Table 13). VENDOR MARKETING METHODS A large percentage of vendors indicat- ed that most of their business was obtain- 11 Table 6 Opinions Respondents What Would Be Necessary To Increase Significantly The Availability Of Vendors and Vendor Services? Percent of Responses Ranking No. 1 and No. 2 Coastal %of 1's/2's Lower Piedmont % of 1's/2's Upper Piedmont And Mountain %of 1's/2's Higher Vendor Prices 1 State % of 1's/2's Foresters Vendors 4.1/12.5 31.8/25.8 6.2/21.9 36.3/35.5 11.9/4.9 31.2/21.9 Technical Assistance 7.2/12.2 32.8/27.1 Foresters Vendors 0.0/8.3 1.5/1.5 3.1/6.2 0.0/0.0 2.4/2.4 0.0/0.0 1.6/6.5 0.8/0.8 Assistance Financing Equipment Foresters Vendors 22.4/10.4 6.1/24.2 28.1/0.0 15.2/16.1 2.4/7.3 9.4/18.7 Increased Supply of Qualified Workers 16.3/6.5 9.2/20.9 Foresters Vendors 4.1/2.1 1.5/10.6 0.0/25.0 6.1/16.1 2.4/7.3 0.0/3.1 A Better Organized And More Stable Market For Vendor Services 3.2/9.8 2.3/10.1 Foresters Vendors Foresters Vendors 28.6/33.3 19.7/15.2 12.5/34.4 3.0/19.4 26.8/41.5 21.9/21.9 Increased Landowner Demand For Veindor Services 40.8/31.2 39.4/22.7 50.0/12.5 36.3/12.9 51.2/36.7 37.5/34.3 Other Factors 24.4/35.6 16.0/17.8 46.3/28.5 38.1/23.3 Foresters Vendors Foresters (No. ) Vendors (No.) 0.0/2.1 0.0/0.0 100.0/100.0 49/48 66 / 66 0.0/0.0 3.0/0.0 2.4/0.0 0.0/0.0 Total Responses 100.0/100.0 32 / 32 33 / 31 100.0/100.0 41 / 41 32 / 32 0.8/0.8 0.8/0.0 100.0/100.0 125 /123 131 /129 1 Includes Out-Of-State Responses 12 Table 7 Forest Practices Offered By Vendor Firms in Georgia, 1980 Firms Offering Site Preparation Timber Stand Planting Improvement Prescribed Burning Site Prep., Plant., TSI, P. Burn 12 12 12 12 Site Prep., Plant., TSI 4 4 4 Site Prep., Plant., P. Burn 9 9 9 Site Prep., Plant. 18 18 .. Site Prep, P. Burn 5 5 Site Prep. 185 .. Planting, TSI, P. Burn -- 3 3 3 Planting, TSI -- 23 23 Planting, P. Burn -- 2 2 Planting -- 71 .. TSI, P. Burn 2 2 Prescribed Burn 1 Total Firms 233 142 44 34 Separate Firms 12 4 9 18 5 185 3 23 2 71 2 1 335 Region Table 8 Georgia Forest Practices Accomplished By Respondiiig Vendors in 197S1, By Ownership and Region Site Preparation Acres % Planting Acres % Timber Stand Improvement Acres % Prescribed Burn Acres % Coastal Lower Piedmont Upper Piedmont-Mountain State 67794 17660 8031 93485 72.5 18.9 8.6 100.0 64766 24715 5672 95153 68.0 26.0 6.0 100.0 10871 1569 1870 14310 1 76.0 11.0 13.0 100.0 29020 11548 4824 45392 Coastal Lower Piedmont Upper Piedmont-Mountain State % All Owner Acres 30052 8378 3075 41505 44.4 72.4 20.2 7.4 100.0 Coastal Lower Piedmont Upper Piedmont-Mountain State % All Owner Acres 37742 9282 4956 51980 55.6 72.6 17.9 9.5 100.0 38215 14637 2622 55474 58.3 68.9 26.4 4.7 100.0 150 1350 1500 10.5 10.0 -- 90.0 100.0 N onindustrial Land -- 26551 10078 3050 39679 41.7 66.9 25.4 7.7 100.0 10721 1569 520 12810 89.5 83.7 12.2 4.1 100.0 1150 1403 592 3145 6.9 27870 10145 4232 42247 93.1 63.9 25.4 10.6 100.0 36.6 44.6 18.8 100.0 66.0 24.0 10.0 100.0 Industry land does not in elude acreage accomplished by i ndustry personnel and equipment but nonindustrial land includes acreage accomplished by industry */endors. 13 Table 9 Responding Vendors, Members and Forest Practice Acreage By Size of Vendor Acreage Site Preparation Vendor Size Vendors Acres (%) Under 500 Acres 57 500-999 11 1000-1499 6 1500-1999 5 2000 & Over 16 Total 95 10083 (10.3) 7084 (7.3) 6342 (6.5) 7900 (8.1) 66274 (67.8) 97683(100.0) 1979 Planting 1 Vendor: Acres (%) 1 36 7943 (7.2) 9 6350 (5.7) 4 4362 (3.9) 1 1800 (1.6) 21 90096 (81.5) 71 110551(100.0) Timber Stand Improvement Vendors Acres (%) 12 1560 (10.9) 1 550 (3.8) 2 2200 (15.4) 2 10000 (69.9) 17 14310(100.0) Prescribed Burn Vendors Acres (%) 15 3292 (7.3) 4 2600 (5.7) 3 3300 (7.3) 3 4700 (10.4) 9 31500 (69.4) 34 45392 (100.0) Includes out-of-state acreage by Georgia vendors. Table 10 Full-Time Equivalent Veiidor Employees and Acres Per Vendor, Acres Per FTE Employee, by Size and Type of Vendor Under 500 Size of Vendor (Acres) 500999 10001499 15001999 FTE Employees Per Vendor Acres Per Vendor Acres Per FTE Employee Number of Vendors 1.53 170.8 111.9 37 (Site Preparation Vendors) 3.03 616.7 203.7 6 4.00 1100.0 275.0 1 3.67 1500.0 409.1 2 FTE Employees Per Vendor Acres Per Vendor Acres Per FTE Employee Number of Vendors .81 208.7 258.3 10 (Planting Vendors - Machine) .80 680.0 850.0 5 FTE Employees Per Vendor Acres Per Vendor Acres Per FTE Employee Number of Vendors 1.27 193.7 152.5 4 (Planting Vendors - Hand) 6.58 1110.0 168.6 2 FTE Employees Per Vendor Acres Per Vendor 1 Acres Per FTE Employee Number of Vendors (S ite Preparation and Planting Vendors) 2.09 268.1 128.2 10 4.53 600.0 132.5 3 5.42 1121.0 207.0 2 6.37 1700.0 266.7 2 2000 & Over 9.45 4900.0 518.5 5 4.8 5287.0 1109.8 6 15.17 2250.0 148.4 2 11.88 3800.0 319.8 10 i The Larger of Site Prep, or 1 5 lant ing Acres where not the same. 14 Table 1 Additional Acres Of Forest Practices That Could H| 4- c S ^ -- e o CO "O ^ C CD CO > nnnnnnront^no ^^l-'3-^-'3-*d-'3-'3-^-'3- - a. CL D ^^nM^cooooooocooorN CD a.' J, CO c ho pE OOOOOiriCOCOCOCOCNCNlOCO cococo*j-oococoinmcocooo Q- co o a- O i- +j O CN CO - ' |o)CN ] ! j ! CN CN - I I I 1 I CN o c oo.* 03 co to Q. C *- O O DC > 00 Q- l/> CU l. o /Qi." -o c o t: ->-(oc)ivminincxi(o 00 CN < CQ C CD CM CN r- CN a. > c o --o co -a CNCNOr^CO-OOCOCNCNCN *~ g > CD oo o i^r^co^-rMCNCNCNCNLnnr^ TO c CO CO CN CN CO co Eo Q. -O icNnctnmo^c^ofco^cioDcinioicNicnoicnoicno co LO CO> o -ca CD > i_ < ^ _ Q. CD c 3 3 O Z Q > Q_ 4-" C_> o o 57 cd co > ed from direct contacts with landowners, as opposed to having the landowners referred to them by foresters and others (Table 14). MAJOR PROBLEMS Vendors were asked to identify what they consider to be their major problems in performing forest practices. Of 146 responses, 24 vendors indicated no major problems and 122 cited a total of 185 problems (Table 15). VENDOR REASONS FOR NOT PROVIDING PRACTICES Few vendors provided the full range of forest practices and many specialized in one of the two reforestation practices (Table 16). 17 Table 14 Vendor Methods of Obtain ing Business Direct Contacts With Landowners as Opposed to Referrals From Foresters and Others By Region Percent of Business from Direct Landowner Contacts Coastal Percent of Vendors Responding Lower Upper Pied. Piedmont & Mountain 100.0% 90-99 80-89 70-79 60-69 50-59 40-49 30-39 20-29 10-19 1-9 0.0 Total Responses 30.0% 21.3 5.0 6.2 3.8 16.2 1.2 6.2 5.0 1.2 3.8 100.0% 25.7% 11.4 5.7 17.1 2.9 11.4 2.9 2.9 11.4 2.9 5.7 100.0% 43.3% 3.3 10.0 3.3 3.3 10.0 3.3 23.3 100.0% State 31.7% 14.5 4.8 9.7 2.8 12.4 .7 1.4 6.2 6.2 1.4 8.3 100.0% Table 15 Vendor Problems Problem Getting and Keeping Good Labor High Fuel and Equipment Maintenance Costs Weather Poor Terrain and Site Conditions Insufficient Demand High Interest Rates and Capital Cost Equipment Break Down Small Tract Size Cooperation and Compliance With Government Collecting From Landowners Scheduling Work Insufficient Equipment Size Profit Margin Other Total Cited No Major Problems Times Cited 41 31 22 15 14 12 7 7 7 5 4 4 4 12 185 24 % Of All Problems Cited 22.1 16.8 11.9 8.1 7.6 6.5 3.8 3.8 3.8 2.7 2.2 2.2 2.2 6.5 100.0 18 3 2106 DM55M 2530 Table 16 Vendor Reason:, For Not Offering Selected Forest Practices Site Preparation No. %Of Responses Total Planting No. %Of Responses Total Timbe Stand Irriprov. No. %Of Responses Total Prescribed B urning No. %Of Responses Total Insufficient Demand 4 22.2 12 27.9 26 34.7 14 20.0 Equipment Or Investment Cost Too High Labor, Obtaining Or Problems Too Much Other Work Land Clearing Only Lack Knowledge & Experience --------13 Lack Time Or Too Time Consuming Not Profitable --1 --------72.2 --5.6 5 8 4 5 --3 1 11.6 5 18.6 10 9.3 4 11.6 5 --7.0 13 4 2.3 3 6.7 3 13.3 11 5.3 6 6.7 5 17.3 8 5.3 8 4.0 2 4.3 15.7 8.6 7.1 11.4 11.4 2.9 Liability Or Risk Business Would Be Too Large Seasonality of Work ---- ---- 2 1 4.7 2 2.3 1 9 2.7 2 1.3 1 12.9 2.9 1.4 Too Much Trouble State Requirements Contractors Do It Cheaper ---- 2 1 4.7 --1 1.3 --1.3 ----1 ----1.4 Total Responses No Equipment 18 16 --100.0 43 25 -- 100.0 75 26 --100.0 70 24 -- 100.0 Not Interested 3 11 22 29 19 GEORGIA FORESTRY A. Ray Shirley, Director John W. Mixon, Chief of Forest Research