Barriers to small business participation in government procurement include:
- A lack of transparency of what government procurement opportunities are available
- Complex terminology in tender documentation and narrow bid specifications not tailored to Victorian business capabilities
- Terms and conditions or business structure requirements, that are excessive and expensive relative to the products or services being provided.
Simplify and streamline procurement policies
The number of different policies and frameworks creates a complex system that is difficult to navigate. Government needs to find ways to streamline and simplify these in ways that still allow appropriate risk management and promote value for money.
Best practice procurement principles need to flow down the supply chain
The government’s policies are often effectively applied when contracting tier one suppliers, many of which are large multi-national corporations. However, these large contractors may not always provide full, fair and reasonable opportunities for the small businesses in their supply chain to engage in work that may occur over the life of a project.
As a result, small, regional and Aboriginal businesses can miss out on opportunities to tender for a significant value of tier two, three and four contracts.
The Victorian Chamber is calling for companies that have been awarded government contracts to be required to publicly list sub-contracting opportunities that are relevant to small business along with a contact point to discuss these opportunities with.
Provide more support and advice on how to access government procurement opportunities
The Victorian Government should also provide increased support for small, regional and Aboriginal business training and advice on how to access government procurement. The training should include how to prequalify, where to find out about tenders, practical advice on how to form joint ventures and introductions to key procurement officers within government agencies.
Improve feedback and transparency
Businesses of all sizes have told the Victorian Chamber that they don’t feel they have been given full, fair and reasonable opportunities to participate in government procurement processes. Particularly issues with receiving relevant feedback on unsuccessful tender bids.
The Chamber will continue to raise these concerns with government and insist that all businesses be given timely feedback on why their bid was unsuccessful and where it could have been improved.