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Public Procurement and Small and Medium Enterprises

Helena Lindskog, Staffan Brege, Per‐Olof Brehmer

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Abstract

The public sector as the biggest buyer on national markets is an important client for and enterprise and for the SMEs in particular. For the SMEs to be a tenderer for governmental contracts as well as for the public agencies to choose a SME as a supplier can have considerable consequences – both positive and negative. To be a supplier for the public sector means recognition and can give a boost for new contracts. For the public agency it can mean to receive an innovative, cost reducing solution. But it can also be risky for both the SME and the public agency. By choosing an enterprise without previous documented records can put an agency in the situation of not fulfilling its obligations towards the general public and for the SME to go bankrupt.

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What this paper is about

The public sector as the biggest buyer on national markets is an important client for and enterprise and for the SMEs in particular. For the SMEs to be a tenderer for governmental contracts as well as for the public agencies to choose a SME as a supplier can have considerable consequences – both positive and negative. To be a supplier for the public sector means recognition and can give a boost for new contracts. For the public agency it can mean to receive an innovative, cost reducing solution. But it can also be risky for both the SME and the public agency. By choosing an enterprise without previous documented records can put an agency in the situation of not fulfilling its obligations towards the general public and for the SME to go bankrupt.

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Available abstract

The public sector as the biggest buyer on national markets is an important client for and enterprise and for the SMEs in particular. For the SMEs to be a tenderer for governmental contracts as well as for the public agencies to choose a SME as a supplier can have considerable consequences – both positive and negative. To be a supplier for the public sector means recognition and can give a boost for new contracts. For the public agency it can mean to receive an innovative, cost reducing solution. But it can also be risky for both the SME and the public agency. By choosing an enterprise without previous documented records can put an agency in the situation of not fulfilling its obligations towards the general public and for the SME to go bankrupt.

Key concepts: Procurement, Agency (philosophy), Business, Small and medium-sized enterprises, Public sector, Industrial organization, Agency cost, Commerce

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