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SA issues ‘How to Sell to Government’ guide

by Michael Read •
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The South Australian Government wants to make it easier for Small to Medium Enterprises (SMEs) and local suppliers to benefit from the State’s $3.8 billion annual Government procurement market.

The Office of the Industry Advocate, in partnership with Business SA, has launched a two-part report and handbook entitled Tender Ready to help local firms tender for government business.

The guide’s publication follows a decision by the South Australian Government in February 2014 to implement an employment test for all Government contracts between $22,000 and up to $1 million in regional South Australia and $4 million in Adelaide, requiring agencies to consider the number of local jobs associated with a project, given the good or service is available in the State.

SA also doubled the minimum tender evaluation weighting from 5 to 10 percent for the use of local suppliers in the State’s heavy and civil engineering construction; professional, scientific and technical services; non-residential building construction; and electrical equipment manufacturing sectors.

“Tender Ready gives clear advice to me on what needs to be done so small businesses are better equipped in this State to win Government contracts. It is also a practical guide to help small business on tendering rules and requirements and managing the tender process,” said South Australian Treasurer and Small Business Minister Tom Koutsantonis.

The handbook provides businesses with information about the tender process, content, layout considerations and writing style.

Included is information on how to demonstrate capability and value for money, an area in which large suppliers usually have an edge due to supply networks and economies of scale.

“[Tender Ready] is also about identifying what both Government and business organisations can do together to increase the number and diversity of local businesses winning Government contracts”, said Koutsantonis.

Tender Ready has been issued at a time when SME participation in government procurement processes is being reviewed across the country. 

At the Federal level, Communications Minister Malcolm Turnbull has encouraged agencies to ditch their wariness of SME engagement, outlining his admiration of the UK’s recent achievements in cutting costs by engaging SMEs in an article in The Guardian Australia.

A recent Parliamentary Inquiry into the Commonwealth Procurement Procedures found that agencies are substantially exceeding the requirement to source at least 10 percent of the value of their procurement from SMEs. According to the Inquiry, the overall figure across Government was 31.7 percent in 2012-13.

In July 2013, the NSW Procurement Board released a direction requiring agencies to seek a quote from at least one SME for contracts worth up to $1 million.

The direction is expected to result in ICT SMEs having a greater prospect of securing NSW government ICT contracts in a market that is estimated to be worth $1 billion per annum.

Victoria has similarly sought to support SME engagement. In November 2012 it released a Guide to improving access to Government business for SMEs.

According to the Guide, agencies are required to “consider SME engagement at the planning stage and improve transparency of procurement opportunities.”


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