Increasing Subcontracting and Investments by Companies in Eastern Finland in the Metal and Wood Industries and the Development of Company Services in the Republic of Karelia and St. Petersburg
Funded by Euregio Karelia Neighbourhood Programme 2001-2006

Objective of the project

The goal of the project was through training, consulting and guidance to provide support and assistance to metal and wood industry companies in Eastern Finland that are planning on starting operations or marketing in the Republic of Karelia or St. Petersburg areas. The goal was also to plan and research future operational models, services and opportunities for JOSEK’s companies in the surrounding areas, provide information in Finland about the operational opportunities in the Republic of Karelia and St. Petersburg and also to relay information regarding Finnish wishes and requirements in the Republic of Karelia.

Main activities

• Company-specific consulting, • Seeking partnerships, • Assessing funding alternatives and environmental impacts when necessary, • Trial orders and contract counselling, • Training and handling of customs issues, permits and certifications.

Achievements

In a change from the original plan, eight medium-sized metal industry companies participated in the project. The metal industry companies had a great need and desire for more cost-effective subcontracting. The wood industry subcontracting, however, was of a different nature and the companies did not see a need for extensive company specific services. The project assessed, in cooperation with the SME Foundation, the functions of the companies and analysed their Russian operations. In addition, the SME Foundation studied the needs and requirements of Finnish companies in detail via interviews and used the obtained information to seek potential partners for the businesses from the St. Petersburg area. A total of 17 partnership reports were created. The SME Foundation also organized and attended the business meetings in St. Petersburg. The Ministry of Economics of the Republic of Karelia identified the metal industry companies in its jurisdiction and assessed their ability to act as subcontractors for Finnish companies and the available metal industry operational facilities for the potential future need of Finnish companies. In addition, the suitability of products from individual companies for subcontracting work in Russia was assessed together with the Onega tractor factory. The companies did not have a need for assessing funding options. Among other materials, brochure texts, price lists, letters and websites were translated into Russian as part of the project. One trial purchase was made during the project. In association with the JOSEK Ltd operational plan directed at Russia, the business service organisations in the Republic of Karelia and the services they offered were assessed. The report was included on the JOSEK Ltd website. The project generated valuable information about and experiences of metal industry subcontracting for the participating companies and JOSEK Ltd that could be shared with other businesses interested in subcontracting in Russia.