SME Participation in the Public Procurement Market in Poland

The public procurement market is a very important sector of the European Union’s economy accounting for around 16% of its GDP and for 1,500 billion Euro. In Poland the market is relatively young. In 2006 its size was assessed to amount to 7.9 billion PLN, which accounted for 7.6% of Poland’s GDP and this marks an upward tendency. It is believed that facilitating access of small and medium-sized enterprises (SMEs) to public procurement will contribute to competitiveness, innovation and job creation (Evaluation of SME’s Access to Public Procurement Markets in the EU, 2007). Although the prime objective of the rules and procedures of the public procurement regime are to achieve value for public money in the award of public contracts by adoption of an open, non-discriminatory and fair competitive process, SMEs face barriers in accessing public procurement contracts as the existing EU surveys indicate (Facilitating the access of SMEs and crafts to public tenders, 2006). These include difficulties in obtaining information, unclear jargon used, lack of knowledge about tender procedures, too high administrative burdens connected with a bureaucratic nature of the process, insufficient time to draw up tenders, too large size of the contracts, cost of preparing the proposal, unnecessarily high qualification levels, financial guarantees required.

The paper presents the results of the questionnaire survey carried out on the sample of 802 Polish small and medium-sized enterprises. The study discussed in this paper attempted to assess the extent of SME participation in the public procurement market in Poland as well as the existing barriers to SMEs’ successful participation in tenders.

According to the research findings, almost 2/3 of all the companies under survey do not participate in a tender. These were the micro companies (71%) which did not choose to take part in a tender most often, but also the youngest enterprises founded after 2005 (82%). Representatives of the surveyed companies indicated the low enterprise potential, unfit to customers’ requirements, as the main problem hindering from the participation in public tenders. Respondents further mentioned complicated administrative procedures, red tape, and also the vague criteria of selecting the best offer and high costs of offer preparation. On the basis of the survey results some recommendations were formulated.