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![](3D"master08_image007.jpg")
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Slide 1
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SME=
s are
active prime suppliers in several categories
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#&=
#13;
=
The SMEs and Federal Procurement=
Transformation and the
Case of Professional Services
Transformation and the
Case of Professional Services
WELCOME
Presentation to OCRI
Marshall Moffat, Director General, Office of Small and Medium Enterprises (OSME)
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Office of SMEs (OSME)
=
;
=
=
=
Advocacy:
Work to ensure SMEs have the opportunity to compet=
e for government business:
Propose new supply systems and policies to create
opportunities for SMEs
Propose the elimination of barriers to competition=
Outreach:
Work with other stakeholders to identify interests=
and
contributions of
SMEs and regions. Take these into
account in the application of new and existing government supply strategies
=
Provide information to and train SMEs to succeed in
government procu=
rement
=
Resolve Trade-offs:
Review existing systems and emerging procurement p=
lans
to identify how S=
ME and
regional impacts can be minimized without compromising the overall objectives o=
f these
plans
Indicate trade-offs by comparing adjustment costs =
(e.g.,
socio-econo=
mic) for
SMEs and regions with the efficiency gains of the plans
=
<=
span
style=3D'font-size:58%;visibility:hidden'>
<=
span
style=3D'font-size:58%;visibility:hidden'>
<=
span
style=3D'font-size:50%;visibility:hidden'>
<=
span
style=3D'font-size:50%;visibility:hidden'>
<=
span
style=3D'font-size:50%;visibility:hidden'>
3
Presentation Overview
=
;
=
=
=
=
=
1.SMEs in the economy: SMEs are a vital part of the Canadas economy, creating 43% of GDP
<=
span
style=3D'font-size:58%;visibility:hidden'>2.
2.SMEs and PWGSC: SMEs have b=
een
major suppliers to the government,
supplying ~66% of contract volume
<=
span
style=3D'font-size:58%;visibility:hidden'>3.
3.Transformation: Small suppliers and regions could be negatively =
impacted by procurement transformatio=
n,
particularly plans to consolidate
and/or bundle contracts
<=
span
style=3D'font-size:58%;visibility:hidden'>4.
4.Consultations: PWGSC held a series of consultations that identified SME suppliers concerns re=
lated to
procurement
<=
span
style=3D'font-size:58%;visibility:hidden'>5.
5.Actions taken: Based on these consultations, PWGSC has taken measures to simplify procurement proc=
esses,
reduce barriers to competition
and redress the exclusion of some smaller companies
<=
span
style=3D'font-size:58%;visibility:hidden'>6.
=
6.Actions underway: A plan is in place to address other SME issues <=
/span>and identify $25M in annual savings by
increasing SME participation
<=
span
style=3D'font-size:58%;visibility:hidden'>7.
7.SME Office: The PWGSC Office of Small and Medium Enterprises <=
/span>=
(OSME) is leading the work to ensure =
that SMEs across
the country have an opportunit=
y to
compete for government business
4
SMEs in the
Canadian Economy
Canadian Economy
=
=
=
=
=
=
SMEs are the most numerous firms in the Canadia=
n economy. Smaller firms also contri=
bute
significantly to key Canadian economic indicators<=
/div>
=
The working definition is taken from Industry
Canada
Small firms:
ΨGoods: Less than 100 employees
ΨServices: Less than 50 employees
=
Medium firms have less than 500 employees
Large firms have more than 500 employees
=
=
=
SME definition
=
=
Canada is home to:
2.4 million SMEs (99% of total); and,
<=
/span>
2,800 large companies (less than 1% of total)
=
=
=
=
SME presence in the economy
=
=
SMEs account for
43% of GDP from SMEs; 23% of GDP from small
business
66% of current employment in Canada
75% of net employment growth in Canada
=
=
=
=
=
Economic indicators
5
PWGSCs relationship with
Small and Medium Enterprises
Small and Medium Enterprises
=
=
=
=
=
=
Reflecting the overall importance of SMEs in the
economy, smaller
firms have played a vital role in supplying the Government of Canada with goods and
services
=
=
=
The=
re are
approximately 10,000 =
active
SME su=
pplierstwo thirds of the total
=
SMEs
constitute more than half of standing offer holders
=
=
=
=
How many SME suppliers?
=
=
<=
span
style=3D'font-size:58%'>Hist=
orically,
small and medium suppliers have supplied:
Ψ66% of PWGSC contracts by volume
(estimate)
Ψ43% of PWGSC contracts by value (esti=
mate)
=
=
=
=
SME share of government business
=
=
ΨProfessional Services ($1.5B annually=
SME
suppliers)
ΨOffice Supplies ($200M annually SME
suppliers)
<=
span
style=3D'font-size:58%'>SME=
s are
active subcontractors in several categories
ΨMajor Crown projects through Industri=
al
Regional Benefits (approximately
$5B annually)
ΨLarge IT projects
<=
/div>
ΨProperty and facility management serv=
ices
=
=
=
=
SMEs in supply categories
6
Procurement transformation:
a) Issues = for SMEs
a) Issues = for SMEs
=
=
Professional
services
Real
property
Copy
paper
Example
In
the supply chain
=
Homogeneous demand
=
Supplies capable of supplying aggregated GoC requirement
1. Consolidate <=
span
style=3D'position:absolute;top:35.0%;left:33.52%;width:16.1%;height:3.5%'>=
contracts =
across govt
As primes and subcontractors
As
subcontractors
SME participation
=
Many small, unique contracts
=
Unconsolidated supply industry
Management of contracts for multiple related needs can be outsourced to a single =
project manager
Market conditions
3. Maintain =
diversified =
contracts
2. Bundle =
multiple =
contracts
Type
of supply
=
=
The transformation of
procurement calls for more central coordina=
tion
to reduce prices, administrative costs and contracting <=
span
style=3D'position:absolute;top:21.0%;left:11.98%;width:85.95%;height:3.75%=
'>times. The impact on SME suppliers will depend on which =
of
the three general procurement
strategies is applied
Positive, mixed and negative. Depends on the precise product
Probable reduction of SME prime suppliers
Probable reduction of SME suppliers
Impact on existing SME suppliers
7
=
=
Future possibilities
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Slide 1
=
Regions may be adversely affected by the transformation because of:
=
;
1.Increased contract scope and <=
/span>scale due to consolidation and bundling
2.More national master standing offers
Procurement transformation:
b) Issues = for Regions
b) Issues = for Regions
=
=
The transformation of
procurement may also impact the regional profile of contracting
8
SME concerns from Consultations in the Fall
=
;
=
=
=
=
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