IntroductionIn the conditions of the modern market and competition on the market in order to achieve success, it is important for enterprises, organizations, and institutions to quickly adapt to change and provide services or sell products that are better than its characteristics are higher than those of its competitors. The globalization of the economy and competition forces enterprises to stimulate production both quantitatively and qualitatively, taking into account demand in the market, as well as their own capabilities. In in conditions of limited resources (raw materials, material, financial, labor, etc.), for the effective operation of a forest sector enterprise, it is necessary to develop, implement and track the main indicators efficiency.As you know, the competitiveness of a region is determined bythe level of competitiveness of the most effective types of economic activity and the activation of new economic opportunities in order to ensure a balancedusing the existing and potential competitive advantages of the region, itsadaptation to external and internal challenges and threats, increasing the role and place of the region in the country's economic space [1, 2]. On the one hand, it is formed under the influence of economic, political, structural and other factors and is a generator of economic opportunities for the region. On the other hand, improving the competitiveness of the region is impossible without a balanced growth of priority areas, sectors of the economy, or types of economic activity, including forestry production.Forestry production as a special branch of the national economy has the following features: the need for large production areas; the relationship of the processwork with biological processes of growth and development of woody plants; variety of forest products; seasonality, etc. [3]. In addition, forestry products are both subject to final consumption and are used in other industries.Thus, it belongs to one of the leading economic sectors, provides raw materials for various production structures and performs other task Thus, in a market economy one of the main sources of formation of competitiveness of domestic entrepreneurial systems, their development and strengthening becomes the intensification of innovative activity.Objects and materialsThe object of the study is the timber industry complex of the Ural Federal District, aggregate indicators and information on the functioning of more than 60 different enterprises. The main methods used were analysis, statistical and mathematical planning, modelling, forecasting, etc., which can be used in other developments.Results and discussionDeveloping a concept to improve the company's competitiveness is a complex problem. Its solution cannot be standard even for two very similar businesses operating in the same market and setting identical goals.Therefore, depending on the action of environmental factors, internal factors, strategic tasks, and individual characteristics of the enterprise, the concept of increasing competitiveness can include many different elements: organizational and managerial, technological, marketing, financial, and investment. The main problems that hinder the successful implementation of competitive advantages of Russia enterprises are, first of all, the technical and technological backwardness of companies and the presence of an unfavorable business climate in Russia. National factors are the main determinants of influence on the current model of competitiveness of Russia enterprises: the natural resource potential of the region contributes to the development of such industries as ferrous metallurgy and chemical industry, geographical location determines the development of export of transport services, and the availability of fertile land resources is the key to the successful development of Forestry [2]. The Russian Federation is the world leader in timber reserves. Its territory contains more than 20% of the planet's forests, many times more than those of the Scandinavian countries, the US and Canada. At the same time, Russia's share of the global timber market is only about 3%, with more than 50% of exports being round timber and sawn timber, i.e. low value-added products. When it comes to high value-added forest products, Russia lags behind.For example, its share of pulp exports is only 4%. In order to compete with more developed countries, Russia's timber industry needs to develop at an accelerated pace. Russia, having a powerful forest resource base, is inferior to a large number of countries in the efficiency of its use, which is caused by a set of problems: organizational, economic, technical and psychological [1,2]. In order to change the situation, structural changes concerning the approaches to the principles of development, enterprise management systems, state regulation of the industry, technical re-equipment, transformation of the mental characteristics of business management, etc. are necessary [3]. It is the radical restructuring of many aspects in the industry that will allow the transition from the economic mechanism of functioning (essentially - survival) to the mechanism of development (expansion of the range and markets, involvement of the population and key partners in planning activities, production of innovative products, participation in research, etc.) of the timber industry complex [6]. In a highly dynamic market environment, the implementation of effective economic activities requires maintaining a high level of competitiveness - one of the main components of the successful functioning of enterprises, and both in domestic and international markets. The term "competitiveness" is applied to goods or products, to producers or service providers, to regions and even to individual countries and national economies [1; 2; 3]. The leading role in shaping the essence of the concept of enterprise competitiveness is played by research by M. Porter, who highlighted the theory of competitive advantage, according to which the competitiveness of an enterprise is measured within groups of enterprises that belong to the same industry [4; 5].The analysis of Russian industries carried out by the researchers showed some trends in the Russian economy. Firstly, the forecast of world prices for basic commodities, in particular forestry raw materials, indicates their rather low level, low value added and is not forecasted above the 2015 level prices. Second, there is an increase in the cost of technology and financing (including credit), which significantly reduces their availability to industrial enterprises. Third, there will be a decline in revenues, including due to higher capital expenditures, input costs and the rise in the cost of the latest technologies. Fourth, a decline in the level and serious shortage of qualified personnel in the timber industry, which will affect the staffing of enterprises and the cost structure in terms of wage increases and insurance premiums. Here, in addition to the demographic decline, the lack of human resources in specific specializations also affects it, which encourages enterprises to abandon highly qualified personnel, training specialists in order to reproduce them [7,14,19]. We can also predict an increase in the cost of extracting forest raw materials due to wear and tear, poor infrastructure of forest roads, especially in Siberian territories, seasonality of harvesting, tightening of environmental standards and applied technologies for the products produced, especially those exported to developed foreign markets.An important step in introducing innovation is the implementation of change. The main task here consists in the consistent implementation of measures for the direct introduction of the innovation. The implementation of changes is carried out in accordance with the adopted programme. The delivery of the results of the change is no less important. At this stage, which completes the process of introducing the innovation, the values of the obtained indicators and characteristics, chosen earlier to determine the effectiveness of the innovation, are evaluated. A preliminary analysis of the priority direction of innovation development is advisable on the basis of economic-mathematical methods, which creates the possibility to identify internal opportunities to reduce irrational costs.For example, when carrying out a financial sustainability analysis and analysing the production and investment capacity of an organisation. Based on the financial sustainability analysis, the type of liquidity or its internal instability of economic inability to absorb the underlying technologies is confirmed.The final stage of implementing innovations is monitoring the results of changes and analysing the errors in the results of changes. Specific principles for evaluating the competitiveness of specific objects are formulated on a case-by-case basis based on the complexity, characteristics and importance of the object. Rational use of resources from the position of innovation management can be presented, first of all, as a return on implementation of advanced techniques and technologies and stimulation of innovative behaviour of business entities [15,16,17].The sequence of innovation formation is presented as:the goal of a new solution;development of scientific research;the output to serial production;sales organization;implementation of the innovation;segmentation in new markets,increasing the competitiveness of the product.As a rule, inventions and discoveries are the basis for scientific and technological progress. When inventions are put to practical use in an area of human activity, they lead to the creation of a new product or new technology (i.e., a product manufacturing process). This means that the idea behind the invention has become an innovation (3, 5, 7).It is necessary to distinguish such areas of development as product improvement and changes in the production cycle from the position of rationality. If we analyse by type of innovation, we note that product innovations usually affect only specific market niches, while technological innovations occupy a larger share of markets and not only individual segments, but also large areas and at the same time provide economic security.Enterprise management systems must assume that the direction and timing of technological progress can be determined almost entirely, and technology is a kind of core capital of the enterprise team. Ultimately, investment has a huge role to play here, namely its role in shaping the economic development strategy of the company in the format or with the support of the state and various private entities. Improving the competitiveness of an organization is the key to increasing the competitiveness of a country. Competition is defined as an activity of individuals who seek to achieve the benefits that others want to gain at the same time and in the same conditions. Its essence is based on the elimination of competitors operating in the same industry and taking over their customers. Competition in individual markets may refer to one of the four basic models: perfect competition, oligopolistic competition, monopolistic competition, pure monopoly. The branch which is perfectly competitive consists of many competitors offering the same product and service. Because of no product differentiation, the price is the same for all competing companies.Oligopolistic competition consists of several companies producing the same or partially differentiated product. This diversity can affect the level of quality, special features, style or service. The company, which manufactures the same product cannot determine the prices of their products at a higher level than the market, unless it wants to attract customers [8,10,11,12]At the same time, increasing competitiveness concerns all levels of its hierarchy: products (goods and services), enterprises, industries, regions and the country as a whole, but also the competitiveness of the enterprise as the main link of the economy is of particular importance. Despite the large number of factors affecting the competitiveness of the forest sector, we will highlight the fundamental factors reflecting the specifics of the industry. Among the most significant we will note the seasonal nature of work, innovations of modification (in particular, in sawmilling). Let us consider that capital is the value that brings surplus value through production and economic activities based on voluntary exchange [1,5,6,9]. The concept of "forest capital" implies a theoretical analysis of the basic concept of "capital". Different attitudes to this concept are known in theory. From the position of forest management, capital is not just a value, but a self-generating value, taking into account natural and climatic, ecological, innovative and investment parameters. Investments play an important role in this. According to the authors, it is reasonable to study such concepts as competitiveness and competitive advantages of forest resources use. As a result, an initial model is formed for grouping not individual factors, but systems of competitiveness and identifying the significance of each factor in the priority areas of forestry complex development from the position of rational use of not just natural resources, but on the basis of innovation. The availability and condition of forest capital is studied on the basis of the factor of time - discounting, taking into account such factors as forest ripeness, logging turnover. Further, on the basis of the strategic level of ensuring the competitiveness of forest capital, the degree of implementation of the strategy to ensure the competitiveness of forest capital is determined in two ways: 1. Competitiveness of forest capital by traditional technologies. 2. The competitiveness of forest capital based on innovations. The achievement of a competitive advantage is possible through sustainable development as a factor of economic stability. The structure of the forest management process includes progressive elements based on a balance between the growth and depletion of natural resources. In spite of the abundance of indicators, the indicator "Estimation of the incremental value of forestry capital" is proposed to assess the competitiveness of forest capital. The calculation of this indicator, according to the authors, should be defined as the ratio of the financial flow in the form of the sum of net profit and depreciation to the value of the assets.The following results were obtained for the forest sites studied.