Good Practice
What To Do When … you want to attract more SMEs into the bidding process

As we come into the holiday months, when we have a little more time our hands for reflection, reading, and thinking about all the soft skills we never have time to address, what we don’t want to be doing is searching around for help, ideas, or tips. So, we’ve done it for you … we’ve trawled our best practice posts from our resident experts from the past year to pick out what we think will be most valuable to you. So, continuing our series of best practice advice for your summer holiday reading, today we look at SMEs and how we can get them more involved in the bidding process.

We are all aware of the possible advantages of inviting smaller firms to tender, and of certain regulations encouraging contracting authorities to do so. So how can we make it easier for small firms to enter the procurement phase? This is not about giving smaller potential suppliers special treatment, it’s about making sure we are not accidentally making it harder for them to compete, or even get into the core procurement phase.

The following is a synopsis of the key points taken from our earlier series on the subject: if you have time to read the whole thing you will find it here, here and here, but for your easy-read this season:

–  Don’t define the specifications too tightly: Sometimes we exclude bidders because of this, even creating monopolies because so few firms can meet the requirements. By keeping our specifications as open as much as we can, maybe with output-based specs, bidders have more opportunity to offer alternative solutions, and that drives innovation too.

–  Broad measures at pre-qualification stage can also deter smaller firms that could actually carry out the work capably. Insisting on a turnover of three times the contract value, for example, is one of these demands at often adds no real value and restricts competition.

–  Requesting multiple references and examples of similar work is fine if you are a dominant existing player, but it will rule out a lot of smaller firms. So long as they are capable, there’s no need to exclude them so early in the process.

–  The complexity of the bidding process is a deterrent in itself. Some very good small firms don’t bid for public contracts when they see a PQQ with 75 questions or the tender documents amounting to hundreds of pages. A balance needs to be struck between doing a thorough procurement job and keeping the workload for bidders proportionate.

–  Giving clearer guidelines on how responses will be judged and evaluated will help bidders. Openness and transparency will help the less experienced suppliers put forward their best possible proposal.

–  Try to express not just your wants in a proposal — but your needs too — there’s a difference, and suppliers may well come up with alternative solutions you weren’t expecting.

–  Provide enough response time — a month is often right but it needs to be appropriate to the tender. Smaller firms do not have large bid teams waiting for things to do!  Also consider time of year issues (holidays, user conferences, proximity to end of quarter).

–  Engage with suppliers upfront, the more equipped and knowledgeable they are about your requirements, the more likely they are to respond. (But be careful to do this on a level playing field.)

–  It’s good practice for buyers to provide feedback on an unsuccessful bid, it helps SMEs for the next time they see an opportunity. It’s just as important for the successful bidder too – and can form the basis of good contract management.

Further reading you may find interesting:

Working With Small Suppliers Is Good for the Public Sector

Conversely

Why Supporting SMEs May Be Bad for Europe

and

Some Tried and Trusted Lessons on How To Get What You Want