Large firms' changing purchasing requirements and local suppliers: toward a new initiative in northeast England

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Abstract
Northeast England, an old industrial region with higher than average unemployment, also contains state-of-the-art manufacturing plants, many owned by multinational companies. A recent project undertaken for the Northern Development Corporation by Segal Quince Wicksteed, found a very high level of interest among these firms in increasing local purchasing. For many, this was linked to the greater autonomy they had recently gained. Adaptation to competitive pressures and the need to control costs had led to much greater emphasis being placed on quality. This could be achieved only by working with a small number of key suppliers. Much local collaboration was already evident, and there was considerable interest in increasing this if suppliers could be found with the right capabilities and attitudes. In economic development terms, scope was found for new initiatives that could provide highly selective information on possible collaborators and support the development of these large firm: supplier relationships by publicizing the opportunities available and encouraging changes in expectation and attitude. This article describes the outcome from a project commissioned by the Northern Development Company with funding from the Department of Employment's Regional Enterprise Unit. The project identified current purchasing practices within the northeast of England, in order to identify the scope for new initiatives that would increase the likelihood of large firms buying from locally based suppliers. It was undertaken during the first half of 1988 by Segal Quince Wicksteed, economic and management consultants, with the support of Durham University's Small Business Center.

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