The company Norse Group is a client of Business Reporter.
The Norse Group has emerged as the largest and most successful in its industry, thanks to its innovative partnership approach.
Reporter for Business: Norse Group
In the UK, there are over 700 companies owned by local authorities. These companies are created for various purposes, such as building houses or providing council services in a more profitable manner in order to support limited budgets. This type of business structure is referred to as a local authority trading company, or LATCo, and has been widely used for the past three decades. One particular company stands out among the others.
Norse Group is the biggest and most prosperous Local Authority Trading Company (LATCo) in the nation. It is fully owned by Norfolk County Council and was the first to realize the potential for growth beyond its local area by forming partnerships with other local authorities that wanted to adopt a more business-oriented approach to providing necessary services while maintaining their commitment to public service values.
In 1988, the organization (initially named Norfolk County Services) was established in reaction to compulsory competitive tendering (CCT), which had been implemented by the Thatcher administration. Led by founder Peter Hawes, the company initially focused on trading and competing for cleaning and catering contracts in the public sector in East Anglia.
The one-of-a-kind deal is driving expansion.
As the company expanded, additional services were incorporated, resulting in a significant increase in revenue. It was evident that there was a demand for a business with origins in the public sector, but with the ability to provide services at the same level as top private sector companies and also be competitive in terms of pricing.
In 2003, Norse’s initial partnerships were established, closely followed by a second one. It was at this time that the board recognized their distinctive offering for the local government sector.
In the following years, the emphasis changed to advocating for and enhancing the partnership approach while taking advantage of being the first in this industry. The rebranding to Norse in 2008 created a fresh image and solidified the company’s position as a business entity, separating it from its origins in the public sector and giving it more credibility as it expanded into new areas.
Currently, Norse Group collaborates with over 20 local authorities and functions across various regions such as the South West, Wales, Wigan, Leeds, London, Kent, and the South Coast. However, it remains rooted in its original home of East Anglia.
Norse now boasts a forward order book of £2.1 billion, an annual turnover in excess of £350 million, and a workforce of more than 9,000 people, putting it among the UK’s top outsourced service providers. The group comprises three primary companies:
- , Norse Commercial Services
Norse Commercial Services offers a range of services including environmental, highway, transportation, and facility management.
- , is
Norse Consulting, a company that specializes in property services, is.
- NorseCare, which owns and runs care homes in Norfolk
The government’s ownership of Norse reflects a strong dedication to public service values within the company. Instead of distributing profits to institutional shareholders, the company returns them to the public treasury. Over the last decade, Norse has given back more than £65 million to its council owner and local authority partners.
Prosperity through partnership
Currently, local councils nationwide encounter several issues: continuously increasing expenses and inflation rates, coupled with a decrease in income, are driving them towards Austerity 2.0; they also confront significant ambiguity as they navigate new procurement laws and stricter waste regulations; furthermore, their community members’ expectations continue to grow. Despite facing financial struggles, their determination to promote social value and reach Net Zero remains strong. How can they reconcile these conflicting goals?
Justin Galliford, CEO of Norse Group, believes that the partnership model used by Norse is the solution. He states that Norse’s ability to deliver cost efficiencies comparable to those of private companies, along with the added control and flexibility of co-ownership for councils, and their strong commitment to public service, make their offer more appealing than traditional outsourcing or in-house delivery.
“Our greatest advantage is the ability to engage in trade in outside markets, creating opportunities for new sources of income. Collaborations that operate as businesses and utilize Norse’s expertise and substantial resources can generate significant additional revenue through trade, and also provide partner councils with the potential for increased prosperity through profit sharing, a key component of all our partnerships.”
“While also safeguarding essential services, ensuring job stability, and generating necessary revenue for local government partners facing financial strain.”
Combining moral principles with business practices
Many corporations with a turnover of millions of pounds have the main purpose of generating profit for their shareholders, making the share price the top priority.
Over the past few years, the significance of social value has increased and it is now part of the broader concept of ESG. It is viewed as a means to boost profits while also contributing to society, particularly when doing business with the public sector.
Norse Group was built on the principles of public service and as the company has grown in commercial expertise, it has maintained its core values. The concept of “ethical commercialism”, termed by Jonathan Werran from the think tank Localis, embodies Norse’s approach and is gaining popularity among the public sector, which values social impact in the business realm.
and
adaptability
Sharing control allows for versatility and adjustability.
In today’s constantly evolving world, the public sector requires adaptability due to the potential impact of new laws. When essential services like garbage disposal or road upkeep need to be restructured due to changes, the ability to act swiftly is crucial. In a typical outsourcing agreement, this often results in prolonged contract revisions and, frequently, higher expenses.
A collaboration with a Norse company does not come with any difficulties: the joint venture organization is partially owned by the partner council, which includes representation on the board, allowing members to have direct control. This enables swift approval and implementation of any modifications to service delivery by the JVC board.
The distinctive blend of being attentive, having business expertise, and prioritizing public service has driven Norse to the top of the market, establishing the company as one of the greatest.
Please go to norsegroup.co.uk for further details.
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