Addressing the low tendering performance of Dutch SMEs

Public procurement is a major instrument in public policy, granting governments substantial steering power. Beyond purely economic rationales, arguments and best practices for social and sustainable procurements have gained momentum in the past years. One such area for reaching wider policy objectives is the support of small and middle-sized enterprises (SMEs) through public procurement which are often found to be structurally disadvantaged in tendering. The literature has produced an interesting chunk of findings on the topic, identifying barriers such as limited buyer expertise, complicated processes, high risk aversion as well as lack of SME capabilities, yet few studies have engaged in combinatory research into success and failure patterns of SMEs. The thesis is embedded in such gap in the literature, investigating, by means of a qualitative comparative analysis (QCA), configurations of conditions on the demand or buyer side and their effect on the chances of SMEs. Findings suggest a positive effect of experience with SMEs in administrations combined with a tender design that is suitable for small businesses. Moreover, arguments in favor of capacity and expertise building on the demand side can be made based on the study results. Dissimilarly, the volume of a tender is not found to hamper SMEs chances. Based on the results, future academic inquiries are encouraged to deliver more evidence on the link between administrative culture and capacity. For public policy, the strong relationship between having experience with SMEs and higher chances for them, motivate strategies to cater to the comparative strengths of SMEs and undertake more efforts to level the playing field.