Member Article

Paul Wright from PAWA Consulting on ‘Winning business from the Public Sector’

There is a lot of media coverage of cuts to government spending, both real and proposed, but this is still a very large potential market for UK businesses. Precise figures are difficult to find, but roughly £200m is spent by the various branches of UK government every year. Most of that is spent by central government, but the NHS accounts for about 20% of the total and local government about 10%.

The coalition government has focussed a lot of attention on public procurement, and while some of this will disadvantage small companies other drives will make it easier for smaller businesses to compete for and win business.

The government is committed to publicising more data about procurement. Councils now have to publish information about all contracts over £500, usually as a spreadsheet or PDF on their website, making it easier to find out what they are buying and from whom. Most councils also publish a guide on “How to sell to the Council” on their website.

The government is encouraging councils to collaborate to gain economies of scale by putting their requirements together and buying larger volumes. This can be either by direct co-operation or through Purchasing Consortia. This makes it harder for smaller businesses to win business if they do not have the capacity. To confront this some councils (such as Leeds) are looking to waive restrictions such as the need to have 3 years accounts in order to encourage small local businesses to bid for business.

The process of bidding can seem bureaucratic, but is designed to ensure that all firms are treated fairly and equally. The government is encouraging all public sector organisations to use the same standard Pre-Qualification Questionnaire form – which means that if you fill in one, you should be able to use the same information to fill in future PQQs . Keep a copy.

The Public Sector has to demonstrate that it has followed regulations in treating all businesses equally as well as obtaining value for money, and so there is little room for negotiation after bids have been received . Put your best offer in first. Public sector clients are quite risk averse, so if you can win some business and gain a track record it makes it much easier to win further business – but you will be expected to bid against other firms anyway.

When you are writing a proposal, think about the people who are going to mark it. These days there is a lot more competition for work, so there are a lot more bids. Make it easy and clear to read. Above all answer the question. Give the evidence they need to score your bid, rather than what you might want to promote.

Good hunting.

For more hints and comments about supplying the public sector look at www.pawablog.blogspot.com

If you want to know more about how public sector procurement works, look out for “Excellence in Public Sector Procurement” by Stuart Emmett and Paul Wright, coming from Cambridge Academic later in 2011.

www.pawa.co.uk

This was posted in Bdaily's Members' News section by Paul Wright .