Small businesses get a bigger share of government procurement contracts

- July 12, 2022 3 MIN READ

There is no substitute for customers and it’s great to see the Commonwealth’s commitment to be a bigger customer for small businesses, writes Australian Small Business and Family Enterprise Ombudsman, Bruce Billson.

Changes to Commonwealth procurement rules announced by Federal Small Business Minister Julie Collins and the Finance Minister Katy Gallagher will mean that 20 per cent of Commonwealth procurements, by value, must be sourced from small and medium enterprises. This doubles the existing target of 10 per cent.

The Government spends about $70 billion a year on contracts, meaning at least $14 billion of this work will go to small and medium businesses.

An important element to ensuring these changes make a real difference will be to provide capacity-building contracts that will enable smaller businesses to really benefit from the contracts to grow their business.

Procuring agencies will also be encouraged to approach multiple suppliers when they are sourcing, from panels which will improve competition and provide more opportunities for smaller businesses to apply for government work.

faster payment times invoicing payments

eInvoicing week

Over the course of the COVID-19 pandemic, being digitally engaged has been very important for businesses to stay connected to their customers.

Adopting eInvoicing is a great way to cut the administrative burden, reduce manual errors and ensure suppliers are paid promptly. Put simply, good business pays.

eInvoicing is the automated digital exchange of invoice information between suppliers’ and buyers’ software, through a secure network.

Small business managers and owners can learn more during eInvoicing week, which runs from 15 to 21 August.

Research from MYOB shows that small and medium-sized businesses with advanced levels of digital engagement are 50 per cent more likely to grow revenue, and earn 60 per cent more revenue per person.

About 1.2 billion invoices are exchanged in Australia every year, but 20 per cent are sent to the wrong person and 30 per cent have incorrect information. It costs around $30 to process a paper invoice, while an eInvoice costs less than $10.

Suppliers no longer need to create paper or PDF invoices to print, post or email. Buyers won’t need to scan and manually enter invoices into their software.

And it can mean faster payments which will improve cash flow.

Importantly, eInvoicing is more secure than posted or emailed invoices, and it reduces the chance of invoice fraud or scams.

According to the ACCC’s latest Scamwatch, payment redirection scams – also known as business email compromise – cost Australian businesses $227 million in 2021, an increase of 77 per cent compared with 2020.

To start eInvoicing, your software needs to be connected to the Peppol network. Many small business accounting software providers already offer Peppol eInvoicing options.

For more information, visit 

happy tradie using computer

A big thank you to small business

We depend so heavily on the small and family-run businesses in our lives – whether it is the local café, accountant, builder, mechanic or grocer who are conveniently there when you need them.

These are great people in plain sight, and we see them everywhere, every day. The best way to support small businesses is to be a kindly customer – patient and understanding, with good and generous intent. Small businesses are run by real people who deserve our respect and empathy every day.

June 27 was World Micro, Small and Medium Enterprises Day and a terrific chance to applaud the contribution small businesses make to our country. You can watch a video of community leaders paying their tribute. It was great that so many, including the new minister, Julie Collins, were able to join me in giving a big thank you to the women and men running our small and family businesses.

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Now read this: 

Are you ready? The eInvoicing revolution is here and it’s inevitable

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