The Federation of Small Businesses campaigns tirelessly to encourage local and national Government to open up their supply chains to more small businesses.
That way, they can help to spread the benefits of public procurement beyond the ‘usual suppliers’ and through to smaller businesses that can offer the very best in terms of quality, innovation and value for money.
So we welcome the fact that, for example, The Ministry of Defence (MoD) has a target to spend 25 per cent of its total procurement budget with small businesses by 2022. However, our most recent research indicates that the MoD is some way off meeting that target at the moment, with just 16.5 per cent of its £20.2 billion procurement budget being spent with small firms. At the current budget level, they will need to up its spending with small businesses by £2 billion each year.
This is possibly because there are a number of key challenges faced by small businesses when bidding for defence contracts. These include getting the correct accreditations, being locked out of purchasing systems and being paid late by suppliers within MoD supply chains.
MORE: Confidence losing streak is still continuingSmall firms would undoubtedly benefit from more support in overcoming these challenges. For example, we would like Central Government to create a small business access fund – to help SMEs meet MoD security and accreditation requirements. We would like the MoD to take steps to open up accessibility and transparency of its ‘Engineering and Delivery Partnerships. Plus, we would like to see businesses working directly with MoD receiving prompt payment.
Through these simple measures, the Government and MoD could open up business opportunities and deliver massive benefits to all involved. Counties like Worcestershire, which boast great strengths in defence and security industries, would stand to benefit most.
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