How to Win Public Sector Contracts as an SME

There is a common belief that public sector contracts only go to large corporations. It is wrong. The UK government has a target for 33% of procurement spend to go to SMEs, and many local authorities actively prefer smaller suppliers. The process is more structured than private sector tendering, but that structure works in your favour if you understand it.

Public procurement follows published rules. The evaluation criteria are stated in advance. Scoring is documented. Feedback is mandatory. Compare that to the private sector, where a buyer can pick whoever they like for whatever reason they choose. For an SME without a large sales team or years of relationship-building, public sector procurement is one of the fairest routes to significant contract revenue.

This guide covers where to find opportunities, how the process works, what evaluators look for, and how to avoid the mistakes that knock out most first-time bidders.

Where to Find Opportunities

Public sector buyers are required to advertise contracts openly. That means the opportunities are there if you know where to look. Here are the main sources.

Contracts Finder

The UK government's free portal for contract opportunities. Central government bodies must publish all contracts over £12,000 here, and sub-central authorities must publish those over £30,000. It is the single most useful starting point for any SME looking at public sector work. You can set up email alerts by keyword, sector, and region.

Find a Tender

This replaced the EU's OJEU (Official Journal of the European Union) after Brexit. Contracts above certain threshold values must be published here. These tend to be larger contracts, but many are split into lots, and individual lots can be well within SME reach. The current thresholds are £139,688 for central government goods and services, and £213,477 for sub-central authorities (as of January 2024, reviewed every two years).

Local Authority Procurement Portals

Most councils and NHS trusts run their own e-tendering portals. Common platforms include In-Tend, ProContract, and Due North. You will need to register on each one separately. It takes time, but once you are registered you receive alerts for relevant opportunities. Start with your local council and neighbouring authorities, then expand.

Framework Agreements

A framework is a pre-approved supplier list for a category of work. Once you win a place on a framework, buyers can call off work directly without running a full procurement each time. Crown Commercial Service (CCS), Eastern Shires Purchasing Organisation (ESPO), and Yorkshire Purchasing Organisation (YPO) are among the largest. Framework places typically last two to four years and can generate steady, repeat revenue.

Dynamic Purchasing Systems (DPS)

A DPS works like an open framework. Unlike a standard framework, new suppliers can join at any time during its lifetime. This is good news for SMEs because you do not have to wait for the next framework refresh. If you meet the qualification criteria, you can join and start competing for call-offs immediately.

Understanding the Process

Public procurement follows a defined sequence. The specifics vary by contract value and procedure, but most opportunities go through these stages.

Typical Procurement Timeline

#	Stage	What Happens
1	Market Engagement	The buyer publishes a Prior Information Notice (PIN) or holds supplier engagement events. This is your chance to shape the requirement before it is finalised. Attend these events. Ask questions. Make yourself known.
2	Selection Questionnaire (SQ)	Formerly known as the PQQ. This filters suppliers by financial standing, technical capability, and relevant experience. Only shortlisted suppliers proceed. Not used for contracts below £100,000 in central government.
3	ITT (Invitation to Tender)	Shortlisted suppliers receive the full tender pack and submit their technical and commercial proposals. This is where the real bid writing happens. Timescales range from 30 to 52 days depending on the procedure.
4	Evaluation	A panel scores each submission against published criteria. There may be clarification questions or presentations. The process is documented, auditable, and subject to legal challenge if done incorrectly.
5	Standstill Period (Alcatel)	For above-threshold contracts, there is a mandatory 10-day standstill between the award decision and contract signature. This gives unsuccessful bidders time to request feedback and, if appropriate, challenge the decision.
6	Contract Award	The contract is signed and published on Contracts Finder. The full timeline from advertisement to award is typically three to six months, sometimes longer for complex procurements.

Tip: Always read the full procurement timetable published with the opportunity. Deadlines in public procurement are absolute. Portals lock at the stated time. There is no grace period and no discretion to accept late submissions.

The Selection Questionnaire

Since 2016, the Cabinet Office has mandated a standard Selection Questionnaire (SQ) for central government procurements. This replaced the old system where every buyer designed their own bespoke PQQ, which was time-consuming for everyone.

The standard SQ focuses on three areas: financial standing, technical capability, and past performance. The questions are fixed, which means you can prepare template answers and reuse them across bids. You still need to tailor responses to each opportunity, particularly the technical sections, but the core information stays the same.

Financial standing checks look at your turnover relative to the contract value, your credit rating, and whether you have any County Court Judgments (CCJs) or insolvency events. Technical capability is about demonstrating relevant experience, qualifications, and the capacity to deliver. Past performance typically requires two or three case studies from similar contracts.

Prepare your PQQ answers in advance

Our PQQ checklist guide covers the standard sections in detail and gives you a pre-submission checklist to run through before every tender. Having a library of pre-written answers cuts your preparation time in half.

Scoring and Evaluation

Public sector bids are evaluated using MEAT: Most Economically Advantageous Tender. Despite the name, this is not just about price. It means the buyer awards the contract to the bid offering the best overall value, considering quality and cost together.

The quality/price split is published in the tender documents. Common weightings are 60% quality and 40% price, 70/30, or even 80/20 for complex services. The higher the quality weighting, the more your written response matters relative to your price.

Typical Quality Scoring Scale

Score	Rating	What It Means
5	Excellent	Response exceeds the requirement with clear, specific evidence and measurable outcomes. Demonstrates added value.
4	Good	Response fully meets the requirement with relevant evidence and examples. No gaps or concerns.
3	Acceptable	Response meets the requirement but lacks detail or evidence. Generic statements without supporting examples.
2	Minor Reservations	Response partially addresses the requirement. Some areas are unclear or incomplete.
1	Major Reservations	Response is poor with significant gaps. Little or no evidence provided.
0	Unacceptable	No response, or response does not address the requirement at all.

The difference between a score of 3 and a score of 5 is specificity and evidence. A 3 says "we have experience delivering similar services." A 5 says "we delivered a 24-month managed IT service contract for a local authority with 2,500 users, achieving 99.7% uptime against a 99.5% SLA, and reducing incident resolution time by 35% over the contract period." Same claim, different level of proof.

SME-Specific Advantages

Government policy actively supports SME participation in public procurement. Several rules exist specifically to level the playing field.

No PQQ Below £100,000

Central government cannot use a Selection Questionnaire for contracts below £100,000. This removes one of the biggest barriers for smaller suppliers. You go straight to the ITT stage, which means fewer hoops to jump through and a faster route to evaluation.

Prompt Payment (30-Day Terms)

Central government mandates 30-day payment terms. This also flows down through the supply chain: prime contractors must pay sub-contractors within 30 days too. For an SME that has been waiting 60 or 90 days for private sector invoices to clear, this is a significant cash flow benefit.

Social Value Weighting

Since January 2021, central government contracts must include a minimum 10% weighting for social value in the evaluation criteria. This covers things like local employment, skills development, environmental sustainability, and community benefit. SMEs that are embedded in their local communities often score well here because they can demonstrate genuine local impact rather than making token promises.

Agility and Responsiveness

Large primes have process, bureaucracy, and overheads that slow them down. SMEs can often offer faster mobilisation, more direct access to senior staff, and quicker decision-making. Buyers know this. When the evaluation criteria include responsiveness, flexibility, or speed of delivery, your size is an advantage rather than a weakness.

Common SME Pitfalls in Public Sector

Most SMEs that fail in public sector procurement do not fail because they lack capability. They fail because of avoidable process errors or wrong assumptions.

Assuming you cannot compete

The biggest barrier is mental. Many SME owners see a government contract and think it is not for them. In reality, many contracts are deliberately sized for smaller suppliers, and the rules are designed to prevent buyers from unfairly excluding SMEs. If you meet the stated requirements, you have as much right to bid as anyone.

Not registering on portals

Opportunities you do not see are opportunities you cannot win. Register on Contracts Finder, Find a Tender, and the procurement portals used by your target authorities. Set up alerts. Check them weekly. Treat it like a sales pipeline, because that is exactly what it is.

Missing deadlines

Public sector deadlines are not negotiable. Portals lock automatically. There is no email you can send, no phone call you can make. If you are submitting at 11:58 for a 12:00 deadline and your file upload stalls, you are out. Submit at least 24 hours early. Always.

Underpricing to win

Buyers evaluate on value, not just price. Submitting an unrealistically low price raises red flags. Evaluators may question whether you can actually deliver, or they may score your pricing methodology as unsound. Worse, if you win at a price you cannot sustain, you will either deliver poorly (damaging your reputation) or lose money. Neither outcome leads to repeat business.

Confusing frameworks with standalone procurement

Winning a place on a framework does not mean you have won work. It means you are on an approved list. The actual work comes through call-offs, which may involve mini-competitions among framework members. Understand the difference. A framework place is a licence to compete, not a guaranteed revenue stream.

Public Sector Is Repeatable Revenue

Here is what makes public sector procurement worth the effort: it repeats. Contracts have defined terms, usually three to five years with extension options. Frameworks run for two to four years. Buyers who find a good supplier tend to keep them, either through contract extensions or by inviting them onto the next framework.

Once you prove delivery on one public sector contract, you have a case study that is directly relevant to the next bid. You understand the process. You have answers ready for standard questions. Your second bid takes half the time of your first, and your third takes half again.

The initial investment in learning the system pays off many times over. And unlike private sector work, where a client can switch supplier on a whim, public sector contracts provide contractual certainty and predictable revenue for years.

Start qualifying opportunities faster

Use the Go/No-Go Decision Framework to assess whether a public sector opportunity is right for your business. Then use RFP Matrix to extract the requirements, track your compliance, and draft responses in a fraction of the time.

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