MORE than 1,300 international companies are based in Northern Ireland, and September's investment summit will certainly do much to continue to attract these important contributors to our economy.
With over 200 global investors in attendance and professional services firm EY announcing 1,000 new jobs, it was a real success in showcasing all that is good about our business sector and our highly skilled workforce.
It was also an important opportunity to also shine a light on some of our own successful indigenous businesses, those that have grown over the years and succeeded in the face of real uncertainty – historically and more recently with Brexit and the current 18-month stalemate at Stormont – challenges unrivalled in other parts of the UK or Europe.
Given that the spotlight was generally on these larger entities, was there really anything in it for our small and micro businesses? The short answer is – plenty. The event itself maybe not so much, but the long term impact is potentially enormous since much of the growth of our micro business sector revolves around the opportunity to supply to these global brands.
In fact it seems that this spillover from foreign direct investment (FDI) is greater here than the UK average. These opportunities will most definitely be directly impacted by the accessibility for our SMEs to the buyers and the buying operations of these global brands. It is a well-documented fact that the closer the centre of buying is to our companies the greater their success in securing contracts.
This could be as much about the confidence of our SMEs to bid for contracts as necessarily anything to do with the buying centres of the global brands. A local buying team, based in Belfast, seems more accessible and visible to our small businesses than, for example, a team in the Middle East, meaning our small businesses are more likely to bid for work, believing there could be greater success in securing a contract.
Given that global buying is also so much more competitive, this could well be the case. It is also well documented that when global brands buy goods and services at a local level, their supply demands tend to be at a scale that is more realistic and manageable for our micro businesses. There is a limit to the capacity and capability of our micro businesses to supply.
In order to make sure we continue to maximise any spillover opportunities from FDI to the micro business sector, we need to continue to negotiate for local buying centres when a global brand is establishing a local presence.
This approach will ensure a much more stable and sustainable small business economy making sure there is something in it for everyone.
:: Michelle Lestas is a turnaround small business specialist, keynote speaker, published author of “In Business with Yourself” and chair of the Association of Business Mentors (Ireland).
