New procurement rules set to be game changer for SMEs
Added by Love Business East Midlands | 10 February 2025
UPDATED: 11 February 2025
The rules governing how the public sector can buy goods and services are changing with the new Procurement Act going live on 24 February 2025 – signalling a potential game changer for small and medium sized businesses, according to an East Midlands-based bid and tender writing specialist.
The Transforming Public Procurement (TPP) programme aims to speed up and simplify public procurement processes, place value for money at their heart and create greater opportunities for small businesses and social enterprises to innovate public service delivery.
Rachel Hayward, who runs the award-winning Derbyshire and Staffordshire-based Ask the Chameleon, welcomed the introduction and highlighted the importance for many SMEs who had previously found the system overly cumbersome to navigate.
Ms Hayward specialises in producing exceptional funding and commercial procurement applications and business award submissions for ambitious East Midlands micro, small businesses, and Third Sector organisations.
Since 2015, ATC has secured access to a total of £156.5m in contracts including £4.6m in charitable funding, , as well as numerous high profile awards for clients.
She explained:
“This is welcome legislation which has been hotly anticipated for sometime and is set to level the playing field for SMEs as well as social enterprises and the voluntary sector.
“The government and public bodies are the biggest purchasers of goods and services in the UK, but many small businesses have struggled to win contracts in the face of competition from much larger businesses.
“This legislation gives businesses a greater opportunity to expand their customer base, boost revenue and foster sustainable growth which will lead to much-needed job creation.
“The Act requires government agencies to set aside 33% of spend specifically for SMEs which provides a fair chance to secure contracts that were previously dominated by larger corporations.
“As well as simplifying the procurement process, a key feature of the TPP programme is that it will enable contracts to be split into smaller ‘lots’ – making it easier for small businesses and social enterprises to complete for and win more local authority contracts.
“The provision of the new Central Digital Platform offers greater simplicity for bidders to find published tender notices as well as one location for commonly used information, reducing repetition and increasing efficiency during the procurement process.
“There is also increased emphasis on prompt payment. Under the new act, government entities are required to make payments within 30 days - ensuring that SMEs receive their dues in a timely manner.”
According to the Act, small and medium-sized enterprises are those with fewer than 250 staff, and a turnover of an amount less than or equal to £44m, or a balance sheet total of an amount less than or equal to £38m.
Ms Hayward continued:
“Although SMEs are the lifeblood of the economy, most do not have the capacity to bid for tenders to secure their own growth or do not feel they would be judged able to deliver public sector tenders.
“The TPP programme will hopefully make the procurement system – particularly for local authority contracts – far more accessible and efficient for both councils and suppliers.”
Ms Hayward highlighted key actions that SMEs who are interested in public sector procurement can introduce to increase their chances of success:
- Stay informed and upto-date with the latest developments, regulations, and opportunities in government procurement. This can be achieved through active participation in industry associations, attending workshops and seminars, and networking with government officials and other SMEs
- Build relationships with key stakeholders, such as government agencies, prime contractors, and other SMEs.
- A strong public sector sales and marketing strategy is imperative for serious bidders. The public sector, like private buyers, conducts research on potential suppliers during the market engagement period (and in some cases even earlier) to identify and understand the best suppliers for the job. Building relationships and a strong brand identity through strong website design, marketing content and targeted marketing emails can ensure that a business is presented in the best possible light.
- Focus on specialisation to attract government contracts that require specialised knowledge or skills
- Invest in tender writing services: Hiring professional Bid Writers can significantly improve the quality of bids and increase chances of winning contracts through understanding public sector needs.
She concluded:
“As a member of the FSB and a champion for SME’s, I very much welcome this new framework and look forward to working with more local businesses to win businesses which will make a real difference to their bottom line and create job opportunities in our local communities.”
