Procurement Changes post 2019

The Procurement system is set for more change.

Currently the rules are set through EU Directives based on the World Trade Organisation’s commitment to transparency.

The impact of Brexit in whatever format is set to open up UK markets to global competition.

Learning from the past

2004 The Missed Opportunity

UK Business Leaders blamed the Government when the EU open competitive processes began to affect UK business. The reality appears to have been that most industry leaders assumed the UK would gain a stronger foothold in developing European states.

Therefore, no time was given to informing, preparing and educating UK business for the competitive tendering process. The UK Business sector was caught napping!

By 2010 the UK Small Business had just been encouraged to enter into the Public Procurement marketplace. They should have been the first point of action in 2004.

The lesson: When political and economic change is coming at a macro level small business owners need to be ready for the micro/local opportunities.

Understanding potential 

2019/20 Open Trading opportunities

Initially things remain the same if there is a deal. Because EU legislation is UK Law the systems remain the same for at least 2 years. However, learning how the WTO, GPA and trade agreements affect the competitive tendering process is something we can address now.

Additionally the global economy is wholly accessible. From the screen of your smart phone you have the chance to compete in new markets. However, so does everyone else.

Increased Competition

UK Businesses failed to compete at the point of change because business leaders relied of the Government to safeguard core contracts.

The competition from France, Germany and Scandinavia took large chunks of Public Sector contracts, or they acquired UK Businesses with the contracts they wanted. How because businesses had invested in training and development.

Specifically Public Sector Procurement rules were understood by the EU community. The UK Business Sector wasn’t ready.

Now as the UK crawls out of the EU, there opportunities. Government seeks trade deals with more countries, therefore, this open trade approach also leads to increasing access to the UK market.

Now is the opportune time to research those countries we should expect more competition from and look for reciprocal trade.

Based on my experience working on contracts in Asia and Africa it is clear UK businesses need to find their feet immediately – a two-year transition or cliff edge exit doesn’t provide the breathing space.

Do something Now!

Action

  1. Find out now about international trade and competition.
  2. Ensure the your business offers the best service to the Public Sector.
  3. Get systems and policies working for you
  4. Embrace change – by preparing for more opportunities.

First Conclusion

The EU stands to lose access to a 341 billion euro per year marketplace in just 2 months, plus £13,000,000,000 in contributions. The UK is one of the biggest contributors to the EU and one of the largest export markets for Germany and France.

Losing 356 billion Euros per annum will create a massive dent in the 27 members economic growth.

Lets look at a staged withdrawal. As UK businesses broaden the supply chain and the government finds ways to reduce EU tariffs for countries outside the existing trade agreement the economic impact would be measured in billions of Euros. Therefore, we need to start the research now.

Tourism is one market already seeing a benefit, with the cost of destinations outside the EU becoming more attractive. Consequently, this impacts positively on the long haul air carriers.

The EU can’t meet the demand for skilled nursing in the UK, however, other international groups are waiting to have access. They are looking for the UK to invest in their education system. To train the youth of a developing country in the UK and offer fixed term employment in the NHS then enable them to return.

Why act today?

Additionally the world without trade borders isn’t possible, however,  business can create a truly flexible marketplace, maximising technology.

The cliff edge – no deal route just means that the UK has to say we’re open for business. The Spanish fruit and veg growers don’t want their stock rotting on the land, knowing  the UK market is open for business.

French Power companies will want the surplus supply they generate to flow into the UK. The UK power industry, mining and steel were destroyed due to the economic conditions.

Farming and Fishing clipped but the land is still there. Without access to Danish Bacon, consumer demand for British Pork rises.

Again, with French Milk, dairy farmers have an opportunity.

Without access to continental cheeses or wines. We know there are great alternatives.

Consequently, Get Creative!

Postscript

UK Business can prepare for any scenario. The first thing they need to do is drive the divorce. Passengers are always at the mercy of the driver, so the answer remains take control and make future opportunities pay off.

There are some great ideas for growth coming in the following newsletters so subscribe or contact Mark

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