The government is working on making it easier for small and medium-sized enterprises (SMEs) to do business with it, both through direct and indirect contracts, according to the Crown Representative for SMEs, Emma Jones.
Speaking at the Digitech 18 conference in Leeds, Jones said the government is on track to meet its aspiration of spending one in every three pounds, or 33%, with small businesses by 2022.
Jones, who performs her job as Crown Representative one day a week, took on the role in 2016, succeeding Stephen Allott, who left in 2015.
Jones said that when she came into the role, there were three things she wanted to do: simplification, promoting the fact that government is open for business, and looking at how the government best buys innovation.
Speaking to business owners, many had told her the problem with being a small business is that “as the founder, I am the person who is completing the bidding document”, and the terms and conditions could be “quite onerous and quite a big commitment”, said Jones.
The Crown Commercial Service has done a lot of work to make this easier, through standardising terms and conditions, and platforms such as G-Cloud and Crown Marketplace, she said. The Digital Outcomes and Specialists 3 (DOS 3) framework was launched on 1 October, and 94% of the suppliers on it are SMEs, she added.
According to Jones, another way to win government business is through indirect contracts, in which large suppliers use smaller businesses further down their supply chain.
A large proportion of the government’s current SME spend is indirect. Figures show that in the 2016/17 financial year, central government departments spent £11.14m with SMEs – £5.2m in direct spend and £5.9m in indirect spend.
This means the government used only 10.5% of its total procurement spend directly with SMEs, while indirect spend stands at 12%.
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The way the government counts SME spending figures has been criticised by the likes of the National Audit Office, but civil service chief executive John Manzoni has previously said counting indirect spend is “fine”.
Jones echoed this sentiment, saying that for business owners who feel there is too much admin in selling to government, selling through strategic suppliers is a good option.
But there is still work to do here, she said. The government has brought together the group of large suppliers on a regular basis to discuss these issues, including their perception that they “find it quite difficult to find SMEs who are suitable”, she said, while there are “thousands of SMEs who would love to sell to government”. The two aren’t quite connected, said Jones.
All of these large suppliers now have an SME champion and the government is working closely with them on how to find SMEs and bring them into their supply chain, she said.
The government is also running a series of “meet the buyer” events, both physical and virtual, promoting the fact that the government is open for business, said Jones.
But it’s not all straightforward, she added. “The third thing which I have to say we haven’t been as successful on as I would have liked is looking at how government best buys innovation.
“I have lots of entrepreneurs who come and say to me: ‘I’d love to sell to government, but I have a product or service that government doesn’t yet know exists, and therefore there purely isn’t a procurement for my product or service’,” said Jones.
“So entrepreneurs are saying ‘we have got these innovative products and services’, and I have lots of government buyers who say ‘well, we’re looking for innovation’. What we haven’t quite perfected is how you connect those two audiences at the right time. The key challenge in that is knowing the pipelines of procurement at an early enough stage.”