Strict public sector tender rules stifle innovation, say over 40% of SMEs

New research has revealed that over two fifths (41%) of British SMEs believe the parameters set out in public sector tenders are too proscriptive and they are stifling innovation in their responses. The finding is among a series of frustrations SMEs have with the tendering process which are actively discouraging them from pursuing public contracts.

The research carried out by AM Bid, creators of Ultimate Tender Coach – a new digital training platform designed to provide businesses with the skills required to secure public commissions – shows that this and other real and perceived challenges such as reaching arbitrary minimum turnover figures are among the most common complaints Britain’s SME bosses have when assessing qualification rules for public sector contracts.

Among the other most common frustrations, 46% of respondents to the research cited understanding and navigating the complexities of the procurement process, 48% were concerned with onerous compliance requirements and 41% felt that deadlines were too short.

“That so many business leaders think the way public tenders are procured is so proscriptive that the tenders themselves become a brake on innovation, should be a concern to many of the procuring parties”, said David Gray, managing director of AM Bid.

“Part of the purpose of the public sector going out to market is to identify appropriate but novel approaches and to wrap in new thinking and new ways of working. Many public procurement bodies do this well but there’s a common perception that although tendering for public work is potentially lucrative, it is still very time consuming and arduous.”

David added: “The research shows that the vast majority of SMEs find the public procurement process challenging, and while the industry is already reacting to some of these barriers and trying to encourage greater SME engagement, we set out to use our expertise to provide additional help.