Scottish procurement policy handbook

16. SMEs, the third sector and supported businesses

SMEs, the third sector and supported businesses are critical to the economic, social and environmental health of Scotland. Scottish public bodies should be committed to making it as easy as possible for SMEs, the third sector and supported businesses to bid for and be successful in public contracts and/or participate in local supply chains. Public bodies are legally obliged to consider how they can involve these businesses in Regulated Procurement processes for public contracts. This is part of the Sustainable Procurement Duty. Details of how public bodies are increasing access to public contracts should be included in a public body’s procurement strategy and annual procurement report. Doing this effectively can promote inclusive growth by giving greater opportunities to SMEs, the third sector and supported businesses.

Public bodies should consider ways to encourage SMEs, third sector and supported businesses to compete for Regulated Procurements and unregulated procurements using systems appropriately. This could be advertising unregulated procurements on PCS and/or using the Quick Quote functionality on PCS.

Public bodies can attract more SMEs, third sector organisations and supported businesses to bid for public contracts through the following measures:

• encouraging suppliers to create an alert profile to receive notifications about opportunities most relevant to them. This includes sub-contracting opportunities which public bodies can encourage their main contractors to advertise on PCS.
• using the Quick Quote process. Suppliers should also be encouraged to create a Supplier Finder profile, which can enhance their chances of being selected for a Quick Quote.
• using Dynamic Purchasing Systems – which can make it easier for new suppliers to bid for public procurement opportunities by widening opportunities to access for new entrants.
• using Project Bank Accounts – which can give sub-contractors more confidence that they will be paid on time in construction projects.
• the use of smaller lots – making bidding more accessible for SMEs, the third sector and supported businesses by splitting large requirements into smaller, specialist and/or geographical areas.
• considering the time allowed for bidders to prepare and submit their bids, and whether additional time would benefit SMEs, the third sector and supported businesses to submit bids.
• considering using Prior Information Notices (PINs) to provide early alerts to providers of upcoming opportunities to enable them to prioritise resource to bid.

Supported businesses

Public bodies can choose to restrict participation in a competitive tendering exercise to supported businesses (see regulation 21 of the 2015 Regulations). A supported business is legally defined as having the purpose of promoting the social and professional integration of disabled or disadvantaged persons while employing at least 30% of its workers from these groups.

Awarding public contracts to supported businesses can help a public body show that it is creating opportunities for all. Supported businesses can help disabled and disadvantaged people integrate socially and professionally.

The Scottish national dynamic purchasing system (DPS) for the provision of requirements reserved for supported businesses has been created by the Scottish Government. The key aim of this DPS is to provide Scottish public sector and third sector bodies with a clear path for the purchase of goods and services from supported businesses and in doing so, support the integration of disabled and disadvantaged people into the mainstream workforce.

Social Enterprises

To help increase the profile of Social Enterprises and to make the process of identifying the market easier for public bodies, an on-line resource Social Enterprise Finder Scotland offers a searchable database for accessing information on social enterprises.

Further support

Public bodies can direct potential suppliers to free advice, training and resources to help them bid for public sector contracts. Support includes:

• Supplier Journey – guides suppliers through the public sector procurement process e.g. from how to bid to learning lessons to improve future bids.
• Supplier Development Programme – helps Scottish SMEs, the third sector and supported businesses bid for public contracts through training, events and opportunities that link suppliers to Procurement Officers to learn more about upcoming contracts.
• Just Enterprise – offers procurement support as part of wider business support to the third sector.
• Social Enterprise Scotland – the representative body for social enterprises in Scotland.
• Procurement Journey – while primarily targeted at public sector Procurement Officers, it is also a useful tool for SMEs, the third sector and supported businesses, helping them to understand the procurement process from a public sector perspective.
• Guidance on public procurement for SMEs and third sector suppliers – one-stop-shop outlining Scot Gov support for SMEs and third sector suppliers.