House Small Business Committee Chairman Sam Graves (R-MO) today held a full Committee hearing on the added value, jobs and economic growth that come from large and small businesses partnering together. Between the anemic economy and demands of a global marketplace, large companies are increasingly creating alliances with smaller companies to benefit from their leanness, nimbleness and creativity.
Recent studies have shown that the top 500 global businesses have an average of 60 alliances each. Additionally, the typical U.S. multi-national corporation purchases goods and services from more than 6,000 small businesses; purchases a total of more than $3 billion in inputs from these small businesses; and relies on these small business suppliers for more than 24 percent of its total input purchases.
“An alliance with a larger company means more opportunity for that small business which in return equals job creation and growth,” said Graves. “As the economy attempts to rebound from the recession, partnering with large companies is a great avenue for small businesses to benefit from financing opportunities, mentoring programs, and a broader sales and distribution base.
“No matter what area a large or small company excels in, they are more likely to succeed if they partner with a company that does well in what they do not. Just as we heard from our witnesses today, these alliances help both large and small businesses remain sustainable and reach new heights for their company. Both of which are important to turn a struggling economy back into a thriving one.”
For additional hearing documents, click here.
Notable Witness Quotes:
Matthew Slaughter, Ph.D., Associate Dean for the MBA Program at Signal Companies Professor of Management at the Tuck School of Business at Dartmouth College in Hanover, NH, said, “Neither small business nor large business operates in a vacuum. Rather, each is deeply embedded in the overall U.S. economy—with extensive connections to each other in product markets, capital markets, and labor markets. One important link between small business and big business is time: small businesses of today can grow to become the big businesses of tomorrow. Many of America’s largest and most successful companies started small—indeed, as the quintessential person pursuing a dream from a garage or dorm room.”
Paul Blackborow, Chief Executive Officer of Energetiq Technology, Inc., in Woburn, MA, said, “The interaction between our small company, Energetiq, and large U.S. companies, notably Intel, has led to significant mutual benefits. We have been able to rapidly develop technologies needed by these large companies. In return, we have received expert technical and commercial guidance and financial support. The result has fueled our growth as a company and helped maintain the technical edge of our large-company partners.”
Robert E. Bruck, Corporate Vice President of Intel Corporation in Santa Clara, CA, said, “Energetiq Technologies, which also is testifying in this hearing, is a prime example of the mutual benefits of Intel’s collaboration with small businesses to develop critical technologies. As a result of the technical and investment relationship with a small company, two technologies critical to the manufacture of Intel’s present generation and future generation semiconductor chips have been developed and commercialized. Energetiq, for its part, has benefitted not only from the revenue generated by sales to Intel’s suppliers, but its relationship with Intel provides significant credibility with its customers, suppliers and other investors enabling it to enlarge its business.”