Prozorro

Do you think that a small company has nothing to catch in public procurement because only large corporations win in them? And if we prove to you that entrepreneurs can earn really big money in Prozorro and win even more often than big companies?

Regarding these issues, we spoke with Maryna Tolochko, head of SmartTender's customer service department, and learned about the results of the entrepreneur's work over the last four months (from May to August 2022).

Entrepreneurs and LLC: Who Wins Tenders More Often?

There is a prejudice that legal entities that have large volumes of goods win tenders more often since they are the ones who can significantly reduce the price offer. The state concludes more contracts with small enterprises. This can be explained by the fact that LLCs are more often focused on multimillion-dollar tenders, while entrepreneurs have the opportunity to choose from a wide variety of purchases worth from hundreds to millions of hryvnias.

This is also confirmed by statistics: in total, in 4 months, state customers concluded 311,154 contracts with entrepreneurs, and 233,986 contracts with LLCs as a result of direct and competitive procurement.

The monthly statistics are as follows:

Prozorro

I would like to emphasize that the contracts concluded during this time brought income of 6,120,053,705 UAH to the entrepreneurs.

Entrepreneurs participated in competitive procedures 18,870 times and won 8,046 times, which is 42.6%. So we can conclude that entrepreneurs have approximately the same chances of winning compared to legal entities.

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I will also note that every month the number of participants in purchases by entrepreneurs increases:

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In Which Categories Did Entrepreneurs Win More Often Than LLCs?

Here are the TOP-5 categories of procurements, in which entrepreneurs were more likely to win (the percentage shows in what part of the total number of procurements in this category the entrepreneurs won):

1. 45450000-6 Other final construction works – 54%.
2. 15610000-7 Products of flour milling and grain industry – 53%.
3. 03220000-9 Vegetables, fruits, and nuts – 51%.
4. 33140000-3 Medical materials – 50%.
5. 15110000-2 Meat – 50%.

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These analytics show that small businesses win on par with large companies.

How Much Did Entrepreneurs Earn From Selling Goods, Works, and Services to the State, and Which Categories Are the Most Attractive for Entrepreneurs?

As mentioned above, in 4 months, entrepreneurs earned more than 6 billion hryvnias on direct and competitive public procurement. Companies applied for participation in various categories of goods, services, and works and won in half of the cases. The following categories became the most profitable for entrepreneurs:

1. UAH 254 million – 45450000-6 Other final construction works.
2. UAH 185 million – 03220000-9 Vegetables, fruits, and nuts.
3. UAH 180 million – 60160000-7 Transportation of mail by road transport.
4. UAH 168.4 million – 45230000-8 Construction of pipelines, communication, and power transmission lines, highways, roads, airfields, and railways; leveling.
5. UAH 160.1 million – 77210000-5 Forestry services.

Separately, I will talk about the TOP-5 entrepreneurs who earned the most from one winning tender:

1. The rating is headed by the entrepreneurs, which concluded a UAH 95.2 contract million based on the results of the procurement of "Services for the transportation of mail by road transport on international routes".
2. The second place was taken by the entrepreneurs, which won the tender "Capital repair of St. Ivan Bohun (restoration of landscaping elements) in Chernivtsi (correction)" and earned UAH 39.9 million.
3. In third place is the earnings of UAH 26.6 million as a result of the procurement "Construction of pipelines, communication, and power transmission lines, highways, roads, airfields, and railways; leveling of surfaces".
4. The fourth place – the entrepreneurs with a victory for UAH 23.1 million in the purchase of "Services for the transportation of mail by road transport".
5. The rating closes the tender "Reconstruction of Bavaria" and its winner – entrepreneurs, which earned UAH 21.2 million.

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But most often entrepreneurs participated and won in the procurement of such goods:

1. 03220000-9 Vegetables, fruits, and nuts – 916 participations, 476 victories.
2. 15610000-7 Products of the flour milling and grain industry – 848 participations, 254 victories.
3. 03410000-7 Wood – 421 participations, 163 victories.
4. 33690000-3 Different medicines – 418 participations, 188 victories.
5. 33140000-3 Medical materials – 414 participations, 183 victories.

As you can see, all the categories listed in the ratings differ among themselves. And this means that government customers purchase completely different goods, works, and services – in total, more than 1,670 categories are represented in the system. Therefore, any entrepreneur will be able to find purchases for their line of business on SmartTender.biz.

Level of Competition: Procurement Categories in Which You Can Win With a High Probability

Now let's look at the five procurement categories in which there was the least competition among suppliers. It was in such procedures that entrepreneurs had the highest chances of winning:

1. 09130000-9 Oil and distillates – 1,040 purchases were made, and the average number of participants was 1.21 (this means that in some tender there was only 1 participant, in another – 2 participants).
2. 45310000-3 Electrical installation works – 725 purchases were made, and the average number of participants was 1.38.
3. 03410000-7 Wood – 550 purchases were made, and the average number of participants was 1.60.
4. 50720000-8 Repair and maintenance services of central heating systems – 178 purchases were made with an average number of participants of 1.28.
5. 50420000-5 Repair and maintenance services for medical and surgical equipment – 188 purchases were made with an average number of participants of 1.35.

There were also enough tenders in which no participant submitted their price offer, so the need of customers was not closed. This means that there are still procurement categories whose potential suppliers are not yet working with government customers. And maybe you can become the first supplier in a certain niche category.

How to Find Out Information About Your Competitors?

SmartTender.biz has its analytical tools that allow registered users to analyze in detail the activities of their competitors in public procurement and to find out information about the public procurements of the selected organizer:

1. Analytics module in the supplier's account.
2. "Competition Analysis" module on the page of the selected tender.

Both tools are free and available after registration on the site.

Read more about Prozorro's useful tools in our “SmartTender Services” article.

In Which Categories of Public Procurement Do Entrepreneurs Earn the Most?

Our team constantly monitors the activities of entrepreneurs in public procurement and prepares interesting statistics on the most profitable procurement categories for entrepreneurs. Find out how much you can earn on Prozorro tenders in our articles:

1. TOP-10 most profitable categories of entrepreneurs working at Prozorro in 2021.
2. TOP-10 most profitable entrepreneurs categories among Prozorro participants in 2020.

How to Start Selling Your Goods, Works, or Services to the State?

To become a public procurement supplier, you only need to complete the following steps:

1. Register on the SmartTender.biz site (independently, using the registration instructions, or by contacting our support service).
2. Find the tender you are interested in on the search page, in which you have the opportunity to provide exactly the service, work, or product that the customer needs.
3. Prepare a tender offer in which you provide documents to confirm compliance with the customer's requirements (the list is specified in the tender conditions) and offer the price for which you are ready to provide goods or services.
4. Wait for the auction stage and participate in it. During three rounds, it is necessary to reduce or leave unchanged the price you offered at the beginning.
5. In case of victory, sign an agreement with the customer on the supply of services, works, or goods and receive payment.

Read more about this in our article "How to participate in the first public procurement on the SmartTender.biz platform".

Participate in public procurement and expand your sales market with SmartTender!