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SMEs and Public Sector Contracts: Part 2

We present a more in-depth analysis of the UK’s public tendering ecosystems, review some of the existing contract finding services and outlining the kind of data a SME needs to access in order to stay across relevant opportunities as they emerge.

It raises interesting technical problems and serves to highlight the need to include psychology in the field of techniques applied to providing data products to a broad audience.

Almost 99% of the 4.8 million businesses in the UK are SME’s, and in the last full year, they gained some 19.8% by value of all UK public sector procurement, providing £43.5 Billion pounds of goods and services (House of Commons,2014). It is government policy to increase this proportion of the public sector spend with SME’s to 25% by 2015. EU legislation governing the awarding of public contracts in the community has been embodied in UK law, and indeed this will be enhanced soon with the adoption by the UK of the most recent EU directive agreed in January 2014. EU and national policy are designed to simplify and open up public sector tendering practices across the community. Extensive efforts to streamline and reduce the administrative burden of tendering for public sector contracts has begun to pay off. The upshot of this is that hundreds of thousands of small businesses are searching for work by examining NHS, UK central government and its agencies and local authority spending. All significant contracts, invitations to supply goods and services with a value of more than £10,000 are published via the Contracts Finder website.


To gain these contracts however businesses have to search for them. They have to find them from amongst the 4,000 plus opportunities that are usually available on the UK governments Contract Finder website, search the dozens of local authority websites and the OJEU website for the many thousands more opportunities available across the wider European community. None of these facilities shares a standard interface or search procedures, nor do they contain a typical range of information about the contracting opportunities or indeed the same contracts. Some of these inconsistencies and problems can be mitigated by paying a commercial contracts finder service, but they have another interface to be learned and their scope, currency and quality are difficult to assess. Worst of all they charge for their services, in effect guarding their data with a paywall.


So as far as the SME community is concerned accessing the data made available in support of the political effort to increase transparency and enhance opportunities for smaller businesses to bid for public contracts it is a far from an easy process. Indeed the choice seems to be simply, pay with your time, always a precious commodity or both your time and money if you subscribe to one of the commercial contract finder services.

One further problem is the nature of the searching and the relationship it has to the possibility of success. Commercial contract finders, reasonably enough charge companies for the quality of access they provide not the number of contracts they find. Searching is also time intensive on the public databases and the amount of time required is not less but greater for those goods and services that are less frequently offered. As we know from our data warehouse, some kinds of bidding opportunity and some types of activity are far more regularly called for than others. The current system does not differentiate between different areas of activity regarding costs. Those businesses are offering services and goods that are less frequently called for, are less likely to get value for money with a paid service and less likely to find anything if they try and do it themselves from public datasets. But of course, smaller, specialist suppliers are a key target for these systems and their success key to government policy.

It seems essential to us that we try and understand this Tendering ecology and explore the use of data science techniques to improve the journey for SME’s. This series of posts will cover our work in analysing the problems and developing solutions that will take what is essentially Open Data and direct it to those SME’s that need to be encouraged and supported to increase their delivery of goods and services to the public sector.

To discuss the ideas presented in this article please click here.