Title: Small- and medium-sized enterprises in public procurement in primary social and healthcare services

Authors: Martti Saarela; Eija-Riitta Niinikoski; Matti Muhos; Ville Isoherranen; Pekka Leviäkangas

Addresses: Kerttu Saalasti Institute, University of Oulu, Pajatie 5, 85500 Nivala, Finland ' Kerttu Saalasti Institute, University of Oulu, Pajatie 5, 85500 Nivala, Finland ' Kerttu Saalasti Institute, University of Oulu, Pajatie 5, 85500 Nivala, Finland ' Kerttu Saalasti Institute, University of Oulu, Pajatie 5, 85500 Nivala, Finland ' VTT Technical Research Centre of Finland Ltd., PL 1100, 90590 Oulu, Finland

Abstract: Small- and medium-sized enterprise (SME) policies tend traditionally to focus on supply-side support instruments. However, public procurement provides a potential demand-side SME policy tool to enhance SMEs and maintain competition in the market. SMEs are often under-represented in public procurement compared to their overall economic weight. Existing literature provides limited information on the instruments of public service providers to create business opportunities for SMEs. The aim of this single case study is to describe the role of SMEs in the statutory public service provision of primary social and healthcare. The study also provides insight into the public service provider's ability to facilitate SME access to public procurement and thereby to enhance the efficiency of the local market. We found that a service voucher system could be an additional option for public procurement, as it allows more flexibility in involving small businesses in the production of public services.

Keywords: public procurement; small- and medium-sized enterprise; SME; SME policy; entrepreneurship; social and healthcare; micro-companies; micro-enterprises; public business support; service voucher; sparsely populated area; Finland.

DOI: 10.1504/IJPM.2018.088617

International Journal of Procurement Management, 2018 Vol.11 No.1, pp.76 - 95

Received: 06 Jun 2016
Accepted: 22 Dec 2016
Published online: 13 Dec 2017 *

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