Stuart Justice, Engineering Director at BAE Systems Naval Ships, used an address at the Scottish Defence Procurement and Supply Chain Summit in Glasgow to set out in practical terms how smaller companies can enter the defence supply chain, warning against cold calling senior leaders and urging SMEs to do their research before making an approach.

Justice told delegates that around 40% of the total cost of a ship was procured through the supply chain, and that BAE Systems Naval Ships worked with over 3,000 SMEs within its tier one supply chain alone, with that number increasing further down the tiers.

“We couldn’t do it without you. We firmly believe that SMEs are essential to keeping our supply chain healthy, agile, and vibrant. They bring flexibility, creativity, and specialist expertise that helps us respond to rapid change of demands.”

The first step for any company wanting to work with BAE Systems, Justice said, was to use the company’s SME supplier landing page rather than attempting to contact individuals directly. “If you’re not an approved supplier, we cannot contract you. It’s as simple as that. I might love your product, I might go, I want that — if you’re not an approved supplier, I cannot release a contract.” He said he received at least two or three unsolicited calls a week from companies trying to reach him directly, and that going through the proper route gave companies the best chance of being seen and assessed properly.

The quality of the initial approach mattered significantly, he said. “Be specific, avoid generic statements. Try and understand what we do. Don’t just tell us you want to work with BAE Systems, tell us which part of the business. More importantly, why? Take time to understand where your capabilities genuinely align, where you fit within the supply chain, what value you can bring.” He added that opportunities existed at every level, from nuts and bolts through to gas turbines and gearboxes, and that companies should be clear about where they sat in that ecosystem.

Justice set out the baseline compliance requirements any supplier needed to meet. ISO 9001 quality accreditation was non-negotiable, flowing down from BAE Systems’ own customer requirements. Public and product liability insurance of £10 million was the standard expectation, though lower levels could be considered on a case by case basis for smaller companies that struggled to obtain cover above £5 million. Counterfeit avoidance, cyber security to DEFSTAN 05-138, a robust business continuity plan, and full compliance with the Health and Safety at Work Act were all cited as requirements. Export control compliance was also flagged as essential given the nature of defence work.

He pointed to specific areas where BAE Systems Naval Ships was actively seeking SME support, including marine autonomy, modularity, DevOps, complement platform evaluation, process and analysis, commodities, and advanced tools and coatings. “These are the areas that we’re asking for assistance for now and today. If you have any interest or expertise in these areas, I’d be great to speak to you after this.”

Justice also set the supply chain challenge in the context of the wider hybrid navy programme, telling delegates that the pace of change in defence procurement was accelerating. “The expectations are changing rapidly. We need to deliver faster, we need to deliver better, and we need to deliver more cost-effectively, all while maintaining the same uncompromising standards of quality. Lead times that were once measured in months or even years need to be measured in weeks.” He said this represented both a significant challenge and a real opportunity for SMEs able to move at pace.

BAE Systems Naval Ships employs around 6,000 people on the Clyde and is currently building five Type 26 Global Combat Ships, with the sixth ship due to commence later this year. The company has invested more than £500 million in modernising UK shipbuilding capability and currently has over 850 graduates and apprentices in the business, growing by more than 200 every year.