The volume of public sector contracts being won by SME suppliers has increased dramatically this year, according to the government.
Speaking at The Crown and suppliers: A new way of working, procurement conference in London, the government’s chief procurement officer John Collington said that in the past, there were not enough SMEs winning business through the usual procurement channels.
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Things are changing, he said. According to the government’s latest figures 44% of government contracts signed in September were with SMEs. This compared to 5% in January.
Technology SMEs find it particularly difficult to win government business as buyers revert to the safe option of buying from the big incumbent suppliers.
Collington referred to the cultural barriers that must be overcome if SMEs are to contribute more to the government. He said the phrase “no one ever got sacked for buying IBM” does not hold true today.
Collington said government procurement policies must support SME growth. This involves reducing the length and cost of procurement processes as well as training government staff to give them better commercial know-how. This will stop buyers just awarding contracts to big suppliers and asking them to manage other smaller suppliers involved in the projects. “We are investing in improving procurement people and supplier management internally,” he said.
Collington also said the government needs to be more open about the projects it is planning to help suppliers prepare to bid. The government is now publishing contract pipelines and will update this every six months.