Small and medium-sized enterprises (SMEs) play an essential role in the UK’s economy but face challenges in securing public sector contracts
The Crown Commercial Service (CCS), the UK’s largest public procurement organisation, supports SMEs by offering more effective guidance on engaging in the public sector bidding process.
CCS supports government buyers across central government and public sectors in purchasing various products and services, from healthcare staff and technology to vehicles and energy. Through its commercial agreements, CCS ensures that businesses of all sizes have opportunities to sell to the public sector, understanding SMEs’ vital role in creating a diverse, competitive supplier base.
Understanding the barriers for SMEs
One of the biggest challenges for SMEs in public sector procurement is the lack of resources.
Many SMEs don’t have the dedicated bid teams or financial backing required to navigate complex tender processes. Bidding can be time-consuming and costly, and with no guarantee of success, SMEs must carefully choose which opportunities to pursue.
Without sufficient access to market intelligence or buyer engagement, SMEs can struggle to understand what the public sector needs or how best to tailor their proposals.
This can reduce their chances of winning contracts, even if they can deliver high-quality services or products.
Market engagement
To help overcome these challenges, CCS emphasises the importance of market engagement, an early opportunity for suppliers to understand buyer needs and refine their proposals before submitting formal bids.
Through preliminary market engagement, buyers offer suppliers early insight into their requirements, which allows SMEs to adjust their strategies or improve their offerings based on customer feedback.
Market engagement is not only about giving suppliers information but also about fostering dialogue. SMEs can ask questions, raise concerns, and suggest improvements or innovations that could be incorporated into the final scope of the agreement.
CCS’s role in facilitating market engagement
CCS plays a crucial role in facilitating this process. The organisation conducts market research, including gathering customer and supplier feedback.
This early engagement ensures that the proposed commercial agreements meet the needs of public sector buyers while providing SMEs with clear, actionable insights into upcoming opportunities.
Before launching a new agreement, CCS first conducts customer market engagement to understand the priorities and requirements of public sector buyers.
Then, they go to suppliers for feedback, especially SMEs. During this phase, SMEs are encouraged to voice concerns or suggest innovative solutions that may not have been considered initially. This dialogue can have a significant impact, as it helps refine the scope of agreements and ensures that SMEs’ perspectives are considered.
For example, CCS has learned that many SMEs are interested in smaller contracts and capable of delivering larger-scale projects. This has led to a shift in how commercial agreements are structured, ensuring that they are not overly focused on smaller value opportunities but also include space for SMEs to compete for larger contracts.
The benefits of early engagement
By involving SMEs in the market engagement process, CCS provides them with a clear understanding of how agreements will be structured, what public sector customers are looking for, and how the procurement process will unfold.
Suppliers can access information on everything from the potential value of contracts to the expected tendering timelines. This early transparency helps SMEs assess whether a specific contract is a good fit for their business and enables them to decide on which opportunities to pursue.
The engagement process ensures that SMEs can provide feedback on terms and conditions, ensuring that social value clauses are non-discriminatory and accessible to all types of suppliers, including smaller businesses and Voluntary, Community, and Social Enterprises (VCSEs).
Inclusive procurement
With the Procurement Act 2023 requiring early market engagement for public contracts, CCS is committed to making the procurement process more inclusive and accessible for SMEs. The goal is to create a system where SMEs can confidently engage with the public sector, knowing they have a fair chance to compete for contracts.
By participating in market engagement activities, SMEs gain valuable insights and have the opportunity to shape how public sector contracts are structured.
This approach leads to a more inclusive procurement environment where SMEs can succeed, helping them grow while ensuring that the public sector benefits from small businesses’ diverse, innovative solutions.
