Selling to Government as a Smaller Technology Vendor
UK central government awards just 10% of its direct spend to SMEs, down from 13% in 2020. Across the EU, the average number of bidders per contract has almost halved. Here is how a smaller vendor competes anyway.
The data on this is not encouraging, and pretending otherwise would not help anyone reading this. Government procurement markets are becoming more concentrated, not less — which makes the strategy for a smaller vendor more specific, not impossible.
The trend, honestly
The European Court of Auditors found that across the EU, the single-bidding rate rose from 23.5% in 2011 to 41.8% in 2021, while the average number of bidders per procedure almost halved, from 5.7 to 3.2. Its own section heading: the share of contracts awarded to SMEs has not increased overall. (ECA Special Report 28/2023)
In the UK, SME share of public procurement in England reached a six-year high in 2025 at 21% of direct spend — but central government sits at just 10%, down from 13% in 2020. (British Chambers of Commerce and Tussell, May 2026)
The UK National Audit Office's own diagnosis explains part of why: frameworks are "geared to buying inputs rather than outcomes," and a framework-based system tends to favour suppliers already large enough to have won a place on the framework in the first place. (NAO, January 2025)
Why this happens, mechanically
Large procurement frameworks reduce a buyer's administrative burden by pre-qualifying a fixed set of suppliers. That is genuinely useful for the buyer. It is also, structurally, a barrier to entry: getting onto the framework in the first place usually demands a scale of track record, bonding capacity or compliance infrastructure that smaller vendors don't yet have — which is precisely backwards if the goal is more competition, not less.
Where smaller vendors can still compete
Routes designed for smaller bids. In the UK, the Digital Outcomes and Specialists framework (currently DOS7, RM1043.9) is explicitly structured for smaller, outcome-defined engagements rather than large multi-year platform contracts — check whether an equivalent exists in your jurisdiction before assuming the only door is the big framework.
Subcontracting to a prime. Large suppliers holding framework places often need specialist capability they don't have in-house. This is a slower path to direct government revenue but a faster path to a credible reference and relevant experience.
Transparency compliance as a differentiator, not a burden. The UK's Algorithmic Transparency Recording Standard states plainly that suppliers "should be comfortable with this level of transparency." A smaller vendor that treats this as a genuine selling point — we are already built for this — competes on trust against incumbents who may be less prepared for the same scrutiny. (GOV.UK)
Named references over marketing claims. At smaller scale, one verifiable, checkable public sector reference does more than any amount of general positioning. Buyers can call the reference. They cannot call a claim.
The honest caveat
None of this reverses the structural trend the data shows. What it does is identify the specific, narrower paths that remain open inside a market that is, overall, consolidating toward larger incumbents — and being clear-eyed about that is more useful to a smaller vendor than false encouragement.
Kaizen Spark Tech designs and delivers software, AI, automation and digital infrastructure for businesses and institutions. Every statistic here is linked to its original published source.