As an older industrial city, Newark continues to rebuild and reimagine its economy. The large anchor organizations headquartered in the city are a tremendous asset. They are the largest employers and have made significant investments in real estate. Anchors also drive economic growth by purchasing goods and services from local businesses. Prior research finds that directing a larger share of these procurement opportunities to local businesses would spur firm growth and the creation of local jobs in Newark.
The Initiative for a Competitive Inner City (ICIC) was engaged by the Prudential Foundation in 2014 to analyze the size and nature of local procurement opportunities in Newark. We analyzed procurement data from six anchor organizations and interviewed 70 individuals from organizations that directly and indirectly support small business development in the city. Our efforts were guided by a local advisory group comprising 30 organizations. This report highlights significant findings from our research and provides a set of recommendations for the city to implement to support a robust buy-local initiative.
Newark has the opportunity to develop a successful anchor procurement initiative built on the realities of its anchor and small business landscape. It will require long-term commitments, changes in policies and procedures at anchor organizations, focused and coordinated small business development efforts, and sustained leadership that represents a coalition of anchor, small business and community partners.
This report identifies an opportunity for Newark anchor institutions to shift over $425 million of procurement toward local purchasing. In addition to targeting local procurement strategies in high expenditure areas, anchor institutions could target local procurement contract opportunities so as to build the capacity of small firms to scale up for future contracts.
