How easy is it to win public sector contracts?

[victorialamb]

Hi everyone,

My name is Vicky and I'm a journalist for Better Business magazine.

I'm writing an article on what the main barriers are for small business owners when it comes to tendering or winning public sector contracts and was hoping to gather some experiences from you on how you have found the process in the past.

If you have any experiences of or opinions on the tendering process for small firms, whether good or bad, I'd love to hear from you.

If you'd like to contact me directly I can supply my details on request.

Thanks in advance

Vicky

 

[OssianTV]

Its a complete nightmare winning government contracts if you're a small business owner because their PQQ (pre qualification questionnaire) weighs heavily on the size of company finances and business size.

 

[Mpg]

The red tape needs to be sorted in order to give SME's a chance at saving the goverment some money.

 

[jncc]

We have tried to get in to working with the local council, even, and found it very hard to even get someone to hear us. But it's much the same with any very large "business" we try to approach, to be honest.

 

[Rufford]

There are companies out there that will do PQQ's for you as a service together with the tender document itself but generally for the small business the price is high - typically £20k in some instances. A company I am involved in has just completed one tender involving three weeks work to answer the PQQ's and write the tender document itself.

Trouble is too - don't bother if you haven't a strong balance sheet. The whole procedure is not for the faint of heart.

-- what is it someone said "don't bring your need to the marketplace, bring your skill. If you don't feel well, tell your doctor, but not the marketplace. If you need money, go to the bank, but not the marketplace".

The marketplace is self-cleaning and also self-healing and in this present one; only the people|companies with innovative ideas and methodologies together with strength will survive. Small businesses must work together

 

[dharm999]

It is an art to write PQQs and ITTs effectively. We used to do it ourselves, not very well in all honesty, but found a third party company to write them for us and the success rate has increased significantly. If you already have written policies and procedures in place, then completing a PQQ is relatively straightforward, it just looks daunting. We dont pay anywhere near five figures for a PQQ, in fact its only three figures, and well worth the money, given the work we have won as a result.

Overall I dont believe its difficult, inherently, for a small company, to win a public sector contract, of a certain size, but the larger ones always go the larger players. my belief is that the process is more complicated than it should be, but once you master it, completing PQQs becomes a matter of routine. Most of them ask for similar information, so c80% of each PQQ is the same, with 20% being specific to the organisation you are trying to get work from. However that 20% is what wins you the contract.

As an aside aren't the government trying to make it easier for SMEs via the supply2gov site?

 

[Piqueperfumes]

Having assessed ITTs and PQQs for large local govt contracts in a previous life I would agree with all dcharm999 says. In addition the number I have seen, even from large companies, that were incomplete, did not enclose crucial documents, were badly laid out etc was alarming. We never went looking for information or made assumptions, if it was not there they were rejected.

So the message is check, check and check again before sending something off. Local govt contracts can often be won by a consortium of small businesses that jointly have the expertise, diversity and resources to make a good bid and deliver an excellent service.

I would definatetly pay for PQQ and ITT services from reputable experts.

 

[Minuteman Press]

Olympic tenders are even more ridiculous. We were excluded because we were not within 8 miles of the location! 'Had to reduce the extraordinary volume of responses somehow'!!!

 

[OssianTV]

But the question here is whether small business are able to equally compete for tenders against large companies

regardless of ability to complete the PQQ - the design of the PQQ more or less disqualifies small companies and completely excludes start-ups - of which could be more than capable, with a dynamic and energetic fresh new approach.

There is too much emphasis on finances, rather than ability and real value for money. I think scrap the financial bit altogether and questions about company size and just ask about solvency/bankruptcy - have you met all your obligations etc. For the vast majority of contracts this is just not needed.

 

[dharm999]

Olympic tenders are even more ridiculous. We were excluded because we were not within 8 miles of the location! 'Had to reduce the extraordinary volume of responses somehow'!!!

They cant exclude you on the grounds of how far away you are. Under EU procurement laws its illegal to do that, as the tenders are open to anyone across the EU, so to say a company has to be within x miles of the contract location cant be used to select companies.

 

[dharm999]

But the question here is whether small business are able to equally compete for tenders against large companies

regardless of ability to complete the PQQ - the design of the PQQ more or less disqualifies small companies and completely excludes start-ups - of which could be more than capable, with a dynamic and energetic fresh new approach.

There is too much emphasis on finances, rather than ability and real value for money. I think scrap the financial bit altogether and questions about company size and just ask about solvency/bankruptcy - have you met all your obligations etc. For the vast majority of contracts this is just not needed.

My view is that they can, if they are prepared to put the groundwork in - they have to ensure they have all the relevant policies and procedures in place. They also need to ensure they complete the PQQ/ITT correctly. To increase their chances of success they need to be selective about the size of contracts they go for - we do the same as we find we get excluded from the really large contracts because we are too small. I agree that the emphasis on finances/accounts is too high as it overshadows ability to deliver.

 

[OssianTV]

Legal or not, I also saw that prerequisite

 

[OldWelshGuy]

the public sector is one of the most crooked, and badly run areas of national Spend.

The dumb systems they have in place in sel2wales, asell2gov etc are pathetic as most of the individuals placing the information for tender don't even get the categories right.

When you Do get notification of anything, the paperwork needed to tender for something as simple as a few grands worth of work, would make a philly lawyer squint.

And then, to top it all off, the contracts are awarded to someone they know anyhow.

The corruption within the public sector procurement sytem beggars belief, and I think this government could probably allow the police a free reign in there and they woiuld no doubt recoup any loss of funding the ploice were likelt to have suffered.

I know of literally dozens of businesses who have simply given up trying to get work from the public sector, partly due to the red tape, partly due to toal incopetence by those gathering tenders, and partly down to what appears to be corruption.

 

[victorialamb]

Hi everyone,

Firstly, thanks so much for taking the time to reply to my thread. Your experiences and opinions are really interesting and seem to echo the general opinion of small business owners and those involved in the tendering process.

I've now written a feature on public sector tenders for Better Business magazine (I can send a free copy to anyone who would like one!).

In short, I found that many small business owners find the PQQ process a bit of a nightmare. One interviewee said they had once received a 30-page PQQ document! However, this is the first hurdle of the entire process and unfortunately this is where small businesses are scuppered. As Dharm999 mentions, anyone looking to tender must be prepared to put in the hours.

Also, one person I interviewed said there is a growing trend of small business owners joining together and forming consortia in order to improve their chances.

OldWelshGuy - I completely agree about the crookedness of the entire system! Although I couldn't be too explicit in my article, it appears that contracts (especially the lower value ones) are awarded with a nod and a wink. It's not what you know, but who you know sometimes!

But there may a glimmer of hope - the ConDem manifesto contained a pledge to award at least 25% of all public sector contracts to small and medium-sized businesses. But saying that, the forthcoming public sector spending cuts (25% from every department) might mean there are far fewer contracts to bid for!

 

[Zeno]

But there may a glimmer of hope - the ConDem manifesto contained a pledge to award at least 25% of all public sector contracts to small and medium-sized businesses.

I don't really see this as a good thing. Wouldn't you prefer that the sucessful company was awarded the contract on the basis that they will do the best job or provide the best value for money rather than how big the company is?

Of course, in many cases the small/medium company might be the best option but any sort of "positive" discrimination is a recipe for disaster in my book.

 

[victorialamb]

I don't really see this as a good thing. Wouldn't you prefer that the sucessful company was awarded the contract on the basis that they will do the best job or provide the best value for money rather than how big the company is?

Of course, in many cases the small/medium company might be the best option but any sort of "positive" discrimination is a recipe for disaster in my book.

Yeah, I agree that any sort of positive discrimination would not be not be very helpful. The glimmer of hope is that the new Government has recognised the significant problems small firms face in the public sector tendering process and it appears to want to improve the situation.

It's such a shame that public sector organisations often opt for larger firms because of the economy of scale. The big boys can offer goods and services at a much lower cost, which throws up the contradiction - the Government wants to cut public spending but also wants to improve access to public contracts for small businesses. How can they square a circle?!

 

[dharm999]

the public sector is one of the most crooked, and badly run areas of national Spend.

The dumb systems they have in place in sel2wales, asell2gov etc are pathetic as most of the individuals placing the information for tender don't even get the categories right.

When you Do get notification of anything, the paperwork needed to tender for something as simple as a few grands worth of work, would make a philly lawyer squint.

And then, to top it all off, the contracts are awarded to someone they know anyhow.

The corruption within the public sector procurement sytem beggars belief, and I think this government could probably allow the police a free reign in there and they woiuld no doubt recoup any loss of funding the ploice were likelt to have suffered.

I know of literally dozens of businesses who have simply given up trying to get work from the public sector, partly due to the red tape, partly due to toal incopetence by those gathering tenders, and partly down to what appears to be corruption.

OWG

Our experience is a mixture of sheer incompetence, and what on the face of it appears to be favouritism, without being too explicit about it. The number of times public sector bodies make mistakes in the process is astounding, mainly down to ignorance of the correct policies to follow.

That for us the frustrating part, we know we can do a good job, our references are always excellent, but no matter how hard you try, the decision goes against you. If a public sector body wants to award a contract to a favourite supplier then it will, the scoring system they use can be skewed to fit the result they want.

At the end of the day it becomes a numbers game, the more you apply for, the more you win, but the quality of the submissions improves, and the success rate also improves.

 

[CKG_]

The thing is how do you define who the 'big boys' are and at what point are you one of the big boys.

A business on the upper end of the small scale (10-50 employees) would seem like a 'big boy' compared to my business

And a business on the upper scale of medium (250 or less) is gigantic by my standards.

I think the issue here is how can micro businesses crack the public sector. Or is it even cost effective to have lots of micro businesses doing lots of work?

I run a business that has won public sector contracts, and yes, once your in and have proven your worth a lot does start to come your way on a nod and a wink because you have a proven track record of doing it right.

Does that make me one of the corrupt big boys? Or just a safe bet for the person who needs something doing?