The recent decision to leave the EU has left many businesses unsure about what the future holds, with widespread concerns about how the changing economic landscape will affect existing markets.
Many businesses have been wondering whether the referendum result will mean that investors will be clambering over each other to dump their UK assets.
One possible outcome could be that businesses take fewer calculated risks as there is a degree of uncertainty about the current trajectory of the economy.
In times of uncertainty it makes sense to operate in the most stable markets. With this in mind, businesses need to explore what opportunities are available in the public sector.
In this article, DCI journalist Julie Shennan provides some much-needed insight into how Brexit will affect public procurement in the UK.
It’s business as usual for public sector procurement
Many of our public and private sector clients have been asking how the EU referendum vote will impact public sector procurement. The short answer is “not a lot”. The slightly longer answer is contained in BiP Solutions’ latest Business Analysis report – Public Procurement After Brexit.
BiP’s Principal Procurement Consultant Eddie Regan spends most of his waking hours either immersed in procurement regulations or running training workshops on how they impact buyers and suppliers.
Eddie has helped BiP clients understand countless regulatory changes over the years and in this Business Analysis, he gives us his expert opinion on the potential impact of Brexit.
How important is the public sector market?
In the financial year 2014/15, the public sector spent approximately £263 billion on goods, works and services, making it the largest marketplace for UK suppliers. It helps drive the UK economy, providing revenue and jobs for thousands of businesses.
The market is open to suppliers of all sizes, with Treasury figures for 2014/15 showing 27.1% of central government buying was with small businesses, either directly (10.9%) or through the supply chain (16.2%).
The report
Written in layman’s terms, Public Procurement after Brexit: BiP Business Analysis examines current UK procurement procedures and the way in which they are likely or unlikely to change after Brexit.
Mr Regan said: “If the UK exits the European Union but joins the European Economic Area, there is likely to be little change if any – the one key difference is we won’t have a voice at the negotiating table for future Directives, but we will probably comply voluntarily, just like Norway, Iceland and Switzerland.”
What should suppliers do?
Unsure of post-Brexit procurement changes, some suppliers fear getting caught up in changing contract law.
However, with much EU procurement legislation heavily influenced by UK priorities, UK procurement is unlikely to change dramatically following Brexit.
If anything, the public sector should become more attractive to UK suppliers.
One of the main concerns for many firms, including those not currently active in the public sector, will be the potential loss of revenue from their existing markets. Aside from the obvious threat to exports, nervousness over the economy might encourage UK customers – both consumers and businesses – to tighten their belts or look for better deals elsewhere. That’s why now could in fact be the perfect time to start looking at the public sector. And that’s an outcome that would be good for suppliers AND buyers!
Remain competitive with DCI
BiP is the UK’s leading specialist in public sector procurement. We have been helping the public and private sectors work together for over 30 years, providing expert procurement consultancy to governments, agencies and purchasing authorities around the world.
The current economic climate means that businesses must use all of the tools and resources at their disposal in order to remain competitive. DCI brings together direct business growth opportunities through public sector contracts and private sector leads, alongside actionable intelligence to put your business in the best position to win.
To find out about our range of available options tailored to your needs, please visit www.dcicontracts.com.
We want to hear from you!
If you have any specific questions about what Brexit means for your business we strongly encourage you to get in touch with us at brexit@bipsolutions.com, or tweet us your questions using the hashtag #BrexitWhatsNext and we will do everything we can to put your mind at ease.
