Challenges faced by Small and Medium Enterprise Suppliers when bidding for tenders. A case of Thika District

The Public procurement market in Kenya like other countries worldwide deal with a wide range of supplies. Though these contracts vary mainly in size, some are clearly within the capabilities of Small and Medium size Enterprises (SMEs). However, SMEs are sidelined from participating in public procurement despite their qualifications, sizes and level of production and despite this preferential treatment of SMEs, comparative tallies of public contracts secured by SMEs in Thika District against those secured by large enterprises are still very small. The study examined the challenges that the SMEs in Thika District face when bidding for tenders and it seeks to determine why they risk losing tenders. The research design used was descriptive and exploratory. The study established that there is a clear Legal/Regulatory framework established in the country to knob public procurement though these guidelines are not open to public scrutiny. The conditions for tendering are not the same for each tenderer and there are ethical malpractices sighted during the process. SMEs encounter financial challenges which include financial regulations and shortage of own financial resources. Information on public procurement and tendering to the SMEs is not adequately available as most respondents were not aware of its existence.

The research concluded that the existence of the legal framework makes it difficult for upcoming SMEs to compete with the established players thus discouraging their participation. Ethical aspect hinders the SMEs from participating in tendering due to in-transparency in the process. Financial requirement is a hindrance. Information on public procurement and tendering is not adequately available to the SMEs thus poor access to the little information availed to them.