Case C, story of the enterprise and its product

The strengths of the entrepreneur of the building enterprise are the entrepreneurship of own parents and own long-term experiences as a shopkeeper. According to the entrepreneur, during that time was learned that “there was no line between home and workplace. Education and career as a building designer prepared for own entrepreneurship. With a colleague from the same designing agency, the plans for their own business were developed.¹¹” In the beginning, the entrepreneurs needed more information. The entrepreneurs had knowledge about the building of factory sheds from single consignments when the business acquired knowledge about construction with prefabricated units. In addition, it was needed to be capable to move from the building of large building towards the designing of smaller units.

Through experimental activities, for example, by building houses in 1997, a business model for the company was sought. Finally, the decision to specialize in building large sheds was affected by the fact that the builders received financial support for their investments. Building prefabricated houses would have required larger investments. The basis for building stables had been created through specialization.

FM-haus was established in 1995, and in the beginning it aimed at markets in Europe and especially in Germany because during that time in Finland the construction industry was taking a downward trend. The operating possibilities were investigated in the Finn Master (maisterwerk) project. The name Finn Master was already registered, so the company was named FM-haus. When building in Germany slowed down, the company returned to domestic markets. The company decided to build a 300 m² hall for a trade fair and the Rural Advisory Centre rented the hall for fair stands of the participants of the trade fair. As a result of this, several similar wooden halls were built the following year. The company built wooden sheds on farms until the investments stopped and building slowed down.

According to the interviewee, Germans are environmental-conscious and the company needed life cycle assessment analysis for developing business. The LCA would have been important in international competitive markets. The company received support for the analysis, but found no-one to do it. Building activities that consider the environment and environmental issues have been part of the business principles as well as saving material in production and pricing the products efficiently. The Häme Polytechnic Evo Unit has been an important creator of the production network. The company has slightly higher prices than its competitor and it has been experienced positively. The principles of sustainable development are implemented in the business. According to the interviewee, the raising of own awareness about environmental issues is important in developing the business. For example, the quality

11 “ettei rajoja kodin ja työpaikan välillä ollut. Koulutus ja työura rakennussuunnittelijana antoivat valmiudet omalle yrittäjyydelle. Samassa suunnittelutoimistossa olevan henkilön kanssa lähdettiin suunnittelemaan omaa yritystoimintaa.”

standards of the suppliers are considered in the production chain. In the entrepreneur’s opinion, the problem with voluntary efforts is that they are not valued. The entrepreneur doubts that the customers are willing to pay more for environmental activity, which is shown to customers in the quality of operations e.g. certificates.

The company has built the marketing and selling networks on its own. The advertising agency has been the same since the beginning and the agency produces all the marketing materials. Hence, the materials are not prepared by the company itself. The company has been satisfied with the solution. The advertisements underline the technique and the speed of building. The advertisement repeats same issues about ‘champion halls in farm building’

or ‘Finland’s fastest’ and ‘builder of versatile halls’. According to the interviewee, advertising functions best by using a big newspaper as a channel and repeating the advertisement. The goal of marketing is to promote the company’s products in a national newspaper: 80% of contacts come from the advertisements in newspapers and 20% through Yritystele. This has raised the awareness of the company most. What also came up was the issue about Internet and that the customers find information and material there and then contact the company. Business is not conducted online and personal selling has its own effect on sales. The interviewee has noticed that the customers have knowledge about using the internet. Portal links could be the future, but having own websites (www.fm-haus.fi) was considered important. The name would be added to search engines when needed.

In the beginning, the entrepreneurs thought that customers would buy the company’s product only once. Now the customers are repeating purchases and the company has invested in taking care of customer relationships. The company has a new customer database brought to use in 2002. The first customers have repeated purchases. There is no aftermarket for new customers. Knowing the competitors, partners and operations in the same field is important because the products are custom-made for customers. The company develops its products so that they are differentiated from the competitor’s offerings. Family relationships are not used in marketing.

FM-haus voluntarily uses the principles of sustainable development in their own business.

It has not been easy. In the beginning, pricing was problematic. A hall builder needs different suppliers and the prices for different components should have been agreed upon more precisely. As this was not done, the prices could change during the production season. In profitable business, the content of the yearly supplier contracts and detailed pricing and contents of specific installation work and prices need to be considered in advance. On the other hand, all the expenses cannot be forecasted because, for example, the price of timber might change rapidly. The company’s products have been priced higher than competitors because of differentiation and steady growth are pursued by pricing.

According to the interviewee, locality and employment possibilities in Häme have not been used in marketing. The company has received an entrepreneur of the year in Jokioinen –award so the company’s activities have supported the community. The entrepreneur acknowledges ecoproductization as an asset in competition but it is not being illustrated in marketing. During the interview, it was also noted that the timber needed in building of stables is mainly certified but the company purchases the timber from several suppliers so use of only certified material was perceived as a remote issue. The strategic aim of the company was steady growth by small enhancements. The marketing activities are used according to

demand. FM-haus will among other things take part in trade fairs also in the future. For example, the farm fairs were considered to be a very concrete marketing place where the company’s customers can be reached personally. The changes in the company are not big even though the new hall is a visible change. The reasonable growth rate for the company for 2003 was expected to be 15-20% from 2002, because investments had been made and are being made. The company has its own mentor who affects the business strategy of the company.

Story of the product C: Stables

FM-haus far commercialised its products such as heat insulated stable and defined a structure of stable building that was profitable for business and ensures that the company is able to compete and there is demand for the products. The goal of business was set to be steady demand according to the needs of agriculture and building of business buildings. The stable as a company product supports the business and helps the company in realizing its goals. In the construction of stables, the share of timber is 80%; the share of work is 15% and tin roof 5% of total costs. The current producer of timber supplies certified timber. Timber is being bought from other timber mills as well. The market area for stables is Southern Finland.

According to the interviewee, the border of the market area is the road between Hanko and Hyvinkää.

During the interview, the issue about the variety of the buyers of stables and their needs came up. The horses in a farm need different kind of product than trotter horses. The customer’s activities, wishes and price define the content of the product. The customer’s images about a stable have caused problems. While the images can be realized, they can raise the price. The interviewee ponders how the customer’s image can be realized in terms of economy. The educational level of customers is highest in agriculture in comparison to racehorse owner customers. Even so, the environmental issues are not well-known in farms.

On the other hand, well-educated people consider environmental issues and the awareness of environmental issues are raised when moving towards a metropolitan area. Horse riding customers are environmentally aware, which helps the negotiations about the contents and quality of timber stable. The company wants to be involved in building farms or stables that fit into the Finnish landscape.

According to the interviewee, the long-term planning of business is important for business strategy. The entrepreneur wishes that the customers perceive the company as adding welfare to animals as well as people. The images of a horse stable will define what kind of stable the customer buys because the purchase decision is not made by what kind of wood the stable is made of. The company could develop service packages for customers that explain the collecting of wood with horses and other issues about horses. For now, the customers are not interested in the environmental operations of the business; it is the environmental features of the end product that count.