Government Opportunities
Selling to the public sector is often considered too difficult and such opportunities too remote by many companies that could and should be considering the public sector as a key potential customer.
There are in fact a vast number of public sector organisations throughout the UK. Local government alone covers every area, the Ministry of Defence (MOD) has over 200 establishments across the country, there are hundreds of NHS trusts and government departments such as HM Revenue and Customs with offices nationwide, colleges and universities are to be found in many towns and cities, as are social services and countless numbers of non-departmental public bodies, all of which have the requirements for virtually every possible product and service, including those of your business.
Government Contracts
Contract opportunities with Government are of increasing importance to SMEs, representing a valuable route to a growing market which each year procures around £220 billion on works, goods and services. In today’s economic climate, the fact that public sector customers traditionally pay promptly makes them excellent clients, offering SMEs stability and business growth. (Source www.hm-treasury.gov.uk)
Lower-value contracts
Awareness of lower-value opportunities has been the first barrier preventing SMEs from participating in the procurement process and winning work with the public sector. Typically, advertised in a variety of places, lower-value contracts can be found on websites, in trade journals, the national press or local newspapers, and as a result have been time consuming, expensive and difficult for smaller companies to identify.
The Supply2.gov.uk portal was developed to assist in removing this barrier by providing centralised access to UK contract opportunities, particularly those of lower-value (typically below £100,000), which fall below the advertising thresholds of the Official Journal of the European Union (OJEU).
Since launch, Supply2.gov.uk has successfully united buyers and suppliers together for the first by providing a single platform where public sector buyers nationwide can advertise lower-value contract opportunities free of charge and attract businesses that can deliver innovation, choice and increased value; so benefiting their organisation and the economy.
High-value (OJEU) contracts
Contracts which are advertised in the Official Journal of the European Union (OJEU) as high-value – can still be viable options for a lot of SMEs.
The EU thresholds dictate the total potential value of the contract, for the lifetime of that contract. Therefore the annual total value could well be under £100,000 and therefore applicable to SMEs.
For instance, a contract for a central government body with a value of £120,000 for three years is only £40,000 per annum: a sum well within the range of most micro-SMEs.
To adhere to EU regulations public bodies are required to advertise opportunities valued above the EU thresholds (typically above £100,000) in the OJEU – and it is these contracts which are classified as ‘high-value’.
Supply2.gov.uk provides upgrade options which include all ‘contract values’ (lower-value and higher-value) – of which over 3000 new contracts are advertised every month.
Furthermore, framework agreements can also be classified as ‘high-value’ and can bring benefits including economy of scale pricing, simplified ordering, reduced procurement and contract management costs and greater flexibility to the purchasing authority. For the same reasons, frameworks can be particularly beneficial to SMEs that have secured contracts.
To upgrade your level of access to include access to high-value contracts online and in your Contract Alert Email, please register or login to Supply2.gov.uk and select Upgrade Options from your Activity Centre.
Public sector customers
All public sector organisations buying in goods and services must get the best value for money. This means they must choose the bid that offers 'the optimum combination of whole-life costs and quality (or fitness for purpose) to meet users' requirement'. So it is important to realise that bids for public sector contracts will not be considered just on the lowest price quoted.
All public bodies should be viewed as a key potential customer.
- Local government spends £27 billion on bought-in goods and services
- Regional spend in the NHS is estimated to be around £12 billion
- Civil government spend £15 billion
- Up to 600 new contract opportunities a week
What are the benefits of selling to government?
Public sector organisations are good customers:
- They have to be fair, honest and professional in the way they choose suppliers and in any dealings with them
- They are less likely to be subject to fluctuations in the market
- They pay promptly and in line with agreed contract terms
- They pay accounts within 30 days (or any other agreed credit period) of receiving a valid bill or invoice
Trading successfully with the public sector will also give you added credibility when dealing with private sector customers.
Supply2.gov.uk – the first portal of call for accessing lower-value opportunities
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