Small businesses are not failing at public sector bidding. In many cases, the public procurement system is failing them.
As a procurement and bid writing consultant, I work with SMEs that are capable, experienced, and well placed to deliver public contracts. Yet many are choosing to step back from tendering, not because they lack the skills or capacity, but because the process has become overly complex, inconsistent, and time-consuming.
Recent findings from the Federation of Small Businesses reflect what many suppliers experience first-hand.
Why SMEs Are Struggling With Public Sector Tenders
Public procurement in the UK is worth around £400 billion, yet only 9 per cent of small businesses have bid for UK Government contracts in recent years. Nearly a third have not won a single tender during that time.
Preparing a competitive bid typically takes several days. Despite this investment, only 5% of SMEs receive clear and useful feedback when they are unsuccessful.
The most common challenges include:
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Difficulty finding suitable opportunities across multiple procurement portals
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Repeated requests for the same information in every tender
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Eligibility and compliance requirements that are disproportionate to contract size
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Requests for unpaid sample work before a contract is awarded
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Ongoing concerns around late payment within public sector supply chains
From a bid writing perspective, the lack of meaningful feedback is particularly damaging. Without a clear explanation of how a submission was evaluated, businesses cannot improve future bids. Over time, many simply stop engaging with public sector opportunities altogether.
Why Feedback Matters in Public Procurement
Feedback is not about reassurance. It is an essential part of a fair and effective procurement process.
When suppliers receive structured, transparent feedback, bid quality improves and competition increases. Contracting authorities benefit from a stronger market and better value for money. When feedback is absent or superficial, procurement becomes risk-averse and repetitive, with the same suppliers winning time and again.
The Procurement Act 2023 and What Comes Next
The Procurement Act 2023 is intended to improve transparency, consistency, and supplier engagement across public procurement.
Whether it delivers meaningful change will depend on how well the new requirements continue to be applied in practice. Clear explanations of bid outcomes, stronger action on late payment, and genuine accountability for supplier treatment will be critical if confidence in the system is to be restored.
Building a System That Small Businesses Will Use
Public procurement does not need to be simplified at the expense of quality. It does, however, need to be clearer, more consistent, and proportionate to the size and risk of the contract.
If small businesses are expected to invest significant time and resources into bidding, they should be met with transparency, fair treatment, and constructive feedback. Only then will public procurement fulfil its potential as a driver of growth, innovation, and value for taxpayers.
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