In the previous blogs we have discussed what public procurement is, as well as various rules and aspects that apply to the whole process. But what are the actual advantages and disadvantages of doing business with a government entity?
The first and foremost positive aspect is that in the majority of nations, government offices and agencies are the biggest consumer in the economy, meaning that there are a huge amount of business opportunities. Furthermore, these are not limited to certain sectors; almost any business can enjoy these benefits. You can explore some of the opportunities here.
Additionally, engaging in international public procurement can be a great stepping stone for a business that wants to expand its activities and venture into foreign markets. If you haven’t had previous experience with expansions, or simply with doing business in one specific country, submitting bid offers can be an easy way to test the waters. Rather than opening new plants and offices, you can simply bid on public tenders and get a glimpse of how well you could handle an expansion of your business.
In one of our previous blogs, we talked about the possibilities of forming partnerships and consortiums during bidding processes. These partnerships can create meaningful relationships that are beneficial to your organisation for much longer than just the duration of your tender contract. Certain organisations, such as Tenderio, can offer their expertise and network of connections and help you in your quest of finding a suitable and reliable partner.
All of the above mentioned things make public procurement an interesting opportunity for businesses – fair enough. However, a few aspects of public procurement often make companies think twice before deciding to bid. First off, regulations and requirements are not the same across all regions or countries, and most of all there are big variations when it comes to accessibility and transparency of bidding processes across public agencies. While some institutions are required to make the information accessible to all interested parties, most are not. Additionally, in some regions bidding processes are far from transparent and the winning bids are awarded based on connections rather than on actual evaluation of the submitted bids.
If you are looking for a quick deal to execute, taking part in public bidding might not be the best solution for you. Unlike standard business deals, doing business with a government can be a long, bureaucratic process. As Brian Hill writes: “Government entities have formal bidding processes that require the submission of detailed proposals that are reviewed by multiple departments. For private companies used to acting quickly, building a relationship with a government entity can seem like an extremely slow process.”
With the right help and the right expertise, these disadvantages can be overcome and you can engage in what could turn out to be a very lucrative business opportunity. Another thing to keep in mind is that public agencies often now create incentives and facilitate the process for small and medium-size enterprises in order to encourage and increase their participation in public procurement. If you are an SME, you can find some useful tips here which can help you be more successful in your bidding adventures!
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