An SME is often managed in an informal way with focus on sales and production. Many SME are also financially vulnerable as they are strongly dependent on a few key customers and key products. As variation will always exist, SME should learn to deal with variation instead of try eliminating it. This paper hypothesises that structural flexibility in SME supply chains through horizontal collaboration leads to a regional environment of economical growth from which all active SME will benefit The hypothesis is examined through two case studies; a Swedish supplier network that has worked together six year and a freshly started Norwegian supplier network. The Swedish suppliers are cooperating; e.g. in case of low capacity, they are sharing production resources. Another benefit of cooperation, supported by Norwegian findings, is the sharing of knowledge amongst each other that lessens the economical strain of keeping up with the “latest”. Cooperation within supplier tier networks marks the emergence of a “collective strength” improving individual suppliers bargaining position towards their customers, e.g. when obtaining new orders, when lobbying for changes in regulations, or when developing and verifying new products. This evolution indicates the emergence of a “Lean Enterprise” within the house building sector.
Horizontal supply chain management, Construction suppliers, Collaboration, SME