Firm Growth and Supply Chain Partnerships: An Empirical Analysis of U.K. SME Subcontractors

This paper examines the performance of a sample of 211 U.K.subcontractors to evaluate whether differences in how they manage their supply chain relationships are associated with differences in (sales and employment)growth rates over two consecutive 3 year periods from 1993 to 1999.We identified 34 firms that had close partnership relationships with members of their supply chain. Our empirical findings indicate that firms with inter-firm partnership arrangements with members of their supply chain experienced significantly higher growth rates. These results suggest that inter-firm partnerships may facilitate more rapid and sustained SME growth,though further research is required to determine the role played by partnerships and the extent to which this may vary to reflect differing owner-manager motivations and growth opportunities.