South: SMEs not interested in public sector work

The public sector lets around £175 billion in contracts each year, yet 48% of firms surveyed by Business Link are “not interested in bidding for public sector contracts”.

In the last few days, business organisations* have called for the Government to adopt the recommendations of the All Party Parliamentary Small Business Group to help small and medium-sized firms (SMEs) to win more government contracts. Business Link in the South East has surveyed both public sector procurers and SME business owners to find out what the barriers are.

The research found that:

• 55% of SMEs in the region have never supplied good or services to the public sector;

• Of 49% SMEs in the South East interested in working for the public sector, 77% would consider seeking support.

Business Link has responded to this research by producing a 24 page Guide to Winning New Business which has a substantial section on public sector contracting. To get a free copy go to http://www.businessquestionsanswered.co.uk/newbusiness.

Popular comments from the public sector procurers interviewed, about why SMEs were unsuccessful when bidding for contracts, included:

SMEs need to make sure they fully understand what the contracting company requires and be proactive by asking questions if they are unclear;

Bidders sometimes don’t complete all parts of the bid or submit supplementary documents;

Firms should be aware that the contract isn’t usually awarded on price alone; experience is just as important which can be easily demonstrated through case studies.

However the research showed that SMEs felt the public sector procurers ask for too much irrelevant information and their tender documents are too long and complex.

SMEs suggested that the public sector should:

· Reduce the amount of information they ask for;

· Simplify the language, limit the use of jargon and reduce the length of tender documents. Ideally the tender documents should just be a short paper with key information and a checklist of documents to submit.

· Give reasonable deadlines for submission, because SMEs don’t have the same resources as larger companies to complete tenders.

Business Link was recognised in the survey as a key source of support. The help it offers to SMEs includes:

• free workshops on bid writing and tendering;

• referrals to suitable low cost, good quality and reliable tender consultants through their Supplier Matching Service;

• information about funding (up to £1,200) towards courses or employee learning opportunities to develop business critical skills involved in sales, marketing and tendering.

Business Link recommends that SMEs register on http://www.supply2.gov.uk which has over 3,000 new contracts added each month.