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Two thirds of SMEs unimpressed by government efforts to open up

Sam Trendall March 25, 2019 in Business and industry, Education and skills Tagged , , - 2 Minutes

A large and growing number of small firms also believe that government will miss its SME spending targets, techUK research reveals

More than two-thirds of SMEs are unimpressed by the government’s efforts to open up the public sector market to smaller suppliers, research has revealed.

The annual govtech SME survey from industry body techUK finds that 68% of respondents do not believe government initiatives over the last five years to make the public sector more hospitable to small businesses have been effective. Furthermore, 63% feel that the target of directing a third of all government spending to SMEs is unachievable within the next half decade.

In last year’s research, about half of respondents believed that the government could still achieve this target.

The 2019 study, which quizzed representatives of 101 SMEs across the technology sector, found that just 15% of respondents think that the government has adequate understanding of the role SMEs could play in public sector provision.

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Nine in ten smaller firms indicated that their preferred route to market would be to engage directly with public-sector customers. Some 76% of those surveyed currently work in this way – meaning that about one in four SMEs that work with government only do so indirectly.

One positive finding of the survey was that 63% of companies believe that G-Cloud – the 11th iteration of which opens for bidding today – has helped them access the government market.

The research was published as part of techUK’s Procuring for innovation and growth report, in which the trade body made five recommendations for how best to overcome the barriers faced by tech SMEs that wish to work with the public sector:

  • Encourage government buyers to drive more procurement through the Digital Marketplace
  • Adopt a more strategic approach to market engagement and engage with industry outside the procurement cycle
  • Develop understanding of SMEs and how to work with them
  • Foster the partnership ecosystem
  • Evangelise through your networks  

Henry Rex, techUK’s head of central government, added: “The overall picture from these results is pretty clear: there is still a great deal to be done to ensure that government can access the range of capabilities that govtech SMEs can bring. Particularly disappointing is the fact that this year respondents seem to have even less confidence than last that the government will meet its SME supplier target in the next five years.” 

He added: “Clearly there is no silver bullet here. If there was one, it would have been used long ago. But I hope that the findings from our survey can add renewed impetus to the SME agenda, and that the recommendations in the report can go some way to improving SME access to the market.”

Click here to read the full report.

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