SMEs in Public Procurement

Practices and Strategies for Shared Benefits

image of SMEs in Public Procurement

The relevance and economic implications of public procurement – which represents 12% of GDP and one-third of government expenditures in the OECD area - make it a powerful tool for improving public service delivery. At the same time, governments are increasingly using their purchasing power to pursue strategic objectives in different policy areas such as sustainability, innovation or providing support to small and medium-sized enterprises (SMEs). Making it easier for SMEs to access public procurement opportunities improves the general economic environment, promotes inclusive growth and supports principles such as equal treatment, open access and effective competition. This report takes stock of the approaches adopted in 37 OECD and non-OECD countries to help SMEs perform better in public procurement markets, including removing barriers to their participation. The report also describes the main features of a public procurement system that benefits both the public sector and SMEs.



Executive summary

Governments are increasingly taking steps both to give SMEs better access to public markets and to remove barriers preventing SMEs from winning public contracts. Engaging SMEs in public procurement is beneficial both for the companies and for the public sector. On the one hand, public procurement contracts give SMEs better access to markets and help them strengthen their own capacities. On the other, the public sector can better meet its procurement needs by working with innovative, responsive and flexible SMEs. However, specific characteristics of public procurement – such as the complexity of procedures, administrative burden and high technical and financial capacity requirements – disproportionately affect SMEs and hamper their access to the market. This report highlights the main elements of a public procurement system that facilitates SME participation and supports SME development more broadly.


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