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SME's - Is tendering harmful to SME's?

Written by: Dr. Rob Smorfitt

Article Overview: Does tendering hurt more SME's than it helps?

SME's - Is tendering harmful to SME's?

How important is government business and large business for SME’s?

I believe it is very important, but there are riders here which must be considered. The purpose of government allocating business to SME’s, is to try and grow the SME sector, as growing SME’s are key players in job creation.

But how can these SME’s keep growing unless they receive continuous business. Sustainable SME creation and growth is completely dependent on continuous business from the buying organisation. But government and large businesses are strong believers that tendering is the best means to purchase the products and services they need. They feel the need to remain impartial in the purchasing process. Yet they espouse supply chain management as their credo. Supply chain management expressly guides the buyer to choosing suppliers that enhance the efficiencies of the buyer at every level. So surely tendering is in contradiction of this credo.

Is tendering an anachronism from the past? Is it not time for government and large businesses to treat the purchasing function in the true spirit of supply chain management, and stop resorting to tendering practices that “are objective” when in fact subjectivity is exactly what is needed.
If government policies are to achieve the goal of creating and growing SME’s, and large businesses are to find the efficiencies they desperately seek in their supply chain, through the use of SME’s, then we need to return to subjective purchasing practices.

Rob Smorfitt

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Article Tags: entrepreneur, entrepreneurship, job creation, new venture creation, SME, SME creation, SMME, Smorfitt



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