IT service provider SFW won its first public sector client in 1998, when the company was contacted directly by the prospect. Director Steve Elliot says, ‘The public sector was struggling to find suitable IT resources at the start of the dotcom boom due to there being a lot of demand from the private sector, so the work was there for us.’
Things have changed, however. Now the bulk of SFW’s public sector work is secured in response to tenders. The company bids for contracts through the Official Journal of the European Union (OJEU), in which all projects above a certain size have to be tendered through an EU-wide procurement hub. ‘It’s quite a labour-intensive process and you do need to have the expertise in putting large bids together to be able to compete,’ says Elliot.
‘A few years ago, the public sector was happy to go straight for the larger names, but now there’s a greater drive to reduce costs’
‘When you pitch for large contracts, the client will always want to visit the reference sites to see how you engaged with your previous customers, what you delivered and whether it was successful,’ adds Elliot. ‘In the public sector they want the reassurance that you’ve got that experience, whereas in the private sector there is a lot more emphasis on commercial confidentiality.’
In these straitened times, those bidding for public sector work also have to be sharper on price. ‘A few years ago, public sector organisations were quite happy to go straight for the larger, better-known names, but now there’s a greater drive to reduce costs so your price needs to be favourable.’
Getting your foot in the door can be rewarding. Elliot finds that once a company penetrates the public sector it can benefit from contracts that endure over far longer periods than in the private sector.
AIM-listed Straight, which sells recycling products, has benefited from public sector contracts for almost 20 years. For CEO Jonathan Straight, the key is to make sure you fully understand the tendering process and what the buying party is trying to achieve.
Straight says that bidders shouldn’t be put off by certain demands: ‘A buyer may specify the requirement of a certified standard of its supplier but not put the words “or equivalent” against that standard. If you have that standard, great, but if you don’t then you want to be in a position where your standard is considered as well – that is your right by law.’
Luckily for Straight, his work is not threatened by public sector cutbacks for now. ‘We don’t see councils stopping buying recycling containers because the initiatives they are using them for will save them money rather than cost them,’ he says.