An independent report by accountants Grant Thornton looking at latest trends in Local Authority Trading Companies (LATCs) has named the Norse Group as the largest such organisation in the country.
There are 743 trading companies in England, Scotland and Wales, with the Norse Group the clear market leader in its field, with a turnover in excess of £280 million.
The report called ‘In Good Company’ acknowledges that the model has been pioneered by Norse (in places such as Daventry see image left) and goes on to analyse the Group’s commercial, operational and ethical approach:
It states: “Norse has a significant number of joint venture companies, most of which are 80% owned by the Norse Group and 20% owned by the partner council. Any profit share is 50/50 between partners.
“Norse has a low margin but high scale business approach with a focus on efficiency and growth to support the creation of jobs.
“They look to be competitive with private firms and constantly develop their commercial skills and demonstrate an ability to operate in a commercial environment.
“Norse has grown through partnering with other local authorities using their JV model, and has put its success down to a range of factors including:
Flexibility in approach
Recruitment from the commercial world leading to a change in the culture of the organisation
Rebranding – the opportunity to move away from being too closely associated with the local authority, improving perception of the company in a commercial world
Positioning itself as a commercial organisation rather than an LATC
Running the company’s own systems such as HR and finance rather than relying on the council’s
Awareness of the political environment – ensuring elected councillors support the rationale of the company.
The report also says that part of the reason for the recent rise of trading companies is the decline in popularity of outsourcing to the private sector.
Norse Group Business Development Director Geoff Tucker said:
The public-public partnership approach that is at the heart of the Norse model does away with the traditional, prescriptive supplier/client relationship by adopting mutually agreed and shared values, objectives and outcomes. It also embodies an ‘ethical commercialisation’ that truly works to the benefit of all stakeholders, including the human resources and supply chain.