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Yes, small businesses can bid for UK government contracts. The government actively encourages SME participation through procurement policies, with 33% of central government spend going to SMEs in 2022-23.
Yes, small businesses can absolutely bid for UK government contracts. The government actively encourages participation from small and medium-sized enterprises (SMEs) through specific procurement policies and initiatives designed to level the playing field.
The UK government has a stated ambition for one-third of its procurement spend to go to SMEs, either directly or through the supply chain. In 2022-23, 33% of central government procurement spend went to SMEs, demonstrating the significant opportunities available. This commitment is embedded in the Procurement Policy Note 11/20 and reinforced through the Public Contracts Regulations 2015.
Under the Procurement Act 2023 (which comes into force in October 2024), contracting authorities must have regard to the particular barriers facing SMEs and consider how to reduce these barriers. This includes requirements to consider dividing contracts into smaller lots where appropriate and avoiding unnecessarily restrictive qualification criteria.
Government buyers are required to consider whether contracts can be divided into smaller lots to make them more accessible to SMEs. They must also ensure that qualification requirements are proportionate to the contract value and complexity. The standard selection questionnaire (SQ) has been simplified to reduce administrative burdens on smaller suppliers.
Find My Tender and Contracts Finder provide free access to government contract opportunities, with lower-value opportunities (under £138,760 for goods and services) advertised on Contracts Finder. Many opportunities specifically welcome SME participation, and some are reserved exclusively for SMEs or social enterprises under certain circumstances.
While small businesses face challenges such as resource constraints for bid preparation and meeting insurance requirements, various support mechanisms exist. The government provides guidance through GOV.UK, and organisations like the Federation of Small Businesses offer procurement support. Some authorities also provide 'meet the buyer' events and pre-procurement engagement specifically to help SMEs understand opportunities.
For detailed guidance on finding and bidding for opportunities, visit our tender opportunities guide which explains the key procurement portals and search strategies for small businesses.