engage magazine issue 001 spring \'06 - Page 16

16 CORPORATE ADVICE Special Feature Are you fit to supply? As the countdown to the Olympics continues, experts are warning SMEs to get their business ready to supply now if they are to capitalise on the opportunities presented by 2012. “SMEs should use a benchmark of 20 – 25% of their annual turnover when deciding which contracts to bid for.” It need not be said that the scale of the Olympic project is tremendous. It will see the construction of nine permanent venues, 9,000 new homes and a public green space the size of Regents Park. Indeed, there will be more than 6,000 workers on site at the peak of construction. And the work won’t end at the closing ceremony. All Olympic venues will need to be deconstructed and reconfigured as part of the Legacy programme. We have been promised that there will be no white elephants as a result of the Games. The benefits to business are enormous. And not just for big business. Small and medium sized enterprises (SMEs) also have the opportunity to bid for a piece of the action. Most of the opportunities for SMEs are likely to come from the supply chains that will surround the major contracts. supplying a great product or service but rather about being a great supplier.” Pre-Qualification Questionnaires (PQQs) are the mechanism increasingly used by public sector and major private corporations to fairly reduce the number of competing suppliers. Brothwell says that SMEs face disappointment bidding for London 2012 Olympic contracts if they fail to fill in PQQs properly. She points to remarks made by Jack Lemley, Head of the Olympic Development Authority (ODA), who said that ethics, quality and safety were the key qualities needed from successful companies. The ODA’s PQQs will reflect these requirements. And it’s important to note that these will apply to all links in the chain and not just the ‘big’ contracts. Brothwell also points out that many companies attempt to punch above their weight and should give due consideration to their place in the supply chain. She says SMEs should use a benchmark of 20 – 25% of their annual turnover when deciding which contracts to bid for. It is also important to ensure that a contract fits within the overall strategic direction of the company otherwise it is unlikely to be sustainable. With the ODA expected to release their procurement policies within the coming months, SMEs will need to get their skates on if they are going to make it over the line in time. These will begin to be released from 2007 and it will be, as one industry expert said, like feeding time at the zoo. It is imperative therefore that SMEs ensure that their business is just as attractive as their products and services otherwise they are likely to miss out. Ruth Brothwell, Supply Chain Manager at Business Link for London emphasises that, “It’s not just about engage SPRING ISSUE 2006