Challenges faced by small and medium enterprises in accessing public contracts in Bondo, Kenya

Abstract

Kenya Government has been in the forefront in advocating for the youth access to Government Contracts. This has been evidenced by the Presidential Directive on Youth Access to Govermnent contracts by allocating 10% of all public contracts to Small and Medium Enterprises (SMEs). Despite this preferential treatment of SMEs, comparative tallies of public contracts secured by SMEs in Bondo against those secured by large enterprises are still very small. The study objectives are to determine the main challenges faced by SMEs in accessing public sector contracts in Bondo District and determining the types of public contracts often secured by SMEs in Bondo District. The research design adopted was stratified random sampling of SMEs in which self-administered questionnaires were used to collect data. A sample size of 136 SMEs out of a population of 210 SMEs were selected. The collected data was analysed using descriptive statistics. From the study perceived corruption, large documentation level, inavailability of public contracts, lack of information access, lack of feedback, large lot sizes, existing framework arrangements, lack of capital, long procurement time-scales, bureaucratic procurement procedures, stringent selection criteria, inaccurate contract information, cost of tendering, poor business infrastructure unfavorable taxation regime and pre-qualification were the major challenges SMEs face in accessing public sector contracts in Bondo. Again the study found that SMEs in Bondo which to some extent secured public sector contracts were found to have mostly drawn their public contracts from the Office of the President, Local Authority, Roads & Public Works and Agriculture & Regional Development. In conclusion, there are still a number of challenges that SMEs in Bondo are facing in accessing public sector contracts. These challenges need to be addressed by both the government and SMEs management. To accomplish this, the study recommends that further research be carried on how these challenges could be reduced both by government contracting authorities and/or SMEs themselves. Further research could also be carried on the initiatives the government has put to facilitate SMEs access to public contracts. Research could also be done on contribution of the level of education of procurement officers in achieving value for money during public procurement.