The importance of SMEs’ network partners in consortium bidding for public sector tenders

Abstract

Purpose: The aim is to examine the importance small and medium-sized enterprises (SMEs) see in different network partners regarding successful tendering in public procurement, and whether this perception predicts the number of joint bids and wins. Design/methodology/approach: The data were collected by an electronic questionnaire which was sent to the registered users of the leading electronic platform for public procurement in Finland. The data were analysed with statistical methods. Findings: The findings suggest that a favourable perception of the importance of horizontal networks in public procurement is associated with a larger number of joint bids and better success in joint bidding. However, the results do not establish a positive correlation between vertical networks and consortium bidding. Research limitations/implications: The data were collected from a single EU country. Since the criteria for bidding consortia may vary between countries, different results might have been achieved from other countries. Practical implications: SMEs should be encouraged to form bidding consortia and acquire related experience. Policymakers should minimise barriers to consortium bidding, e.g. by offering more information. They should also assess the merits of joint bidding because they rarely encourage SMEs to bid as a consortium. Social implications: Consortium bidding is a way of enhancing SMEs’ possibilities to participate in public tender contests, even in large contracts. Originality/value: While consortium bidding has been recognised to enhance SMEs’ possibilities of participating in public procurement, there is limited research into how SMEs’ network collaborations relate to bidding as a consortium.