Selling to the City

The City offers significant marketing opportunities to companies that supply the many products and services needed by the business community that sits within the Square Mile. Yet despite this potential for sales, there are significant barriers that limit and sometimes prevent companies, and especially SMEs in the City fringes, from taking advantage of the opportunities that exist. 

Research carried out by the City of London  identified a number of different reasons for this:

• Many SMEs do not having a history of working in the City and so do not have a track record with City firms.
• Many SMEs do not have an established credit history - something that many City businesses look for
• It can be difficult for SMEs to understand the different procurement practices adopted by City businesses and especially who they should contact
• The tendering and bidding process is often quite complicated - discouraging a number of would-be suppliers
• Many City businesses require suppliers to have particular credentials - relating to the environment, quality management and corporate social responsibility. Not all SMEs have had the opportunity of achieving the necessary accreditation.

To begin to overcome these barriers and to support SMEs in the City fringes to become "fit to supply the City", the City of London Corporation commissioned a number of different projects in late 2008 offering business support and training. An evaluation of this programme's first phase, which concluded at the end of March 2010, has been carried out - not only to measure success of the programme but also to think about the future. In particular, the evaluation aimed to identify the most effective ways of providing support for both SMEs and City businesses.

The overall aim of these recommendations is to make City businesses think "local procurement" while helping SMEs in the City fringes to be fit to meet the challenge of supplying the City. 

The evaluation determined that involvement of and guidance from City businesses will be crucial to the success of the next phase of the programme, and so the City of London Corporation would like to invite all City businesses to get involved.  There is a 'live poll' at the end of this article that invites procurement and CSR professionals from City firms to register an interest in participating through, for example, involvement in a focus group, acting as a SME mentor or contributing to a workshop.

Here are some of the recommendations for future support from the evaluation. They focus on increasing awareness of local procurement and the many benefits it brings as well as putting in places effective ways of SMEs meeting the City buyers - and City buyers meeting SMEs. Recommendations also include the provision of training and support to help SMEs understand different procurement practices and to tailor their products and services to meet the needs of City businesses.

Promoting awareness and understanding of local procurement and the benefits it brings

Significant levels of local procurement can only become a reality when businesses (City businesses and SMEs alike) are aware of local procurement, how it works in practice and the benefits it brings. Some ways of achieving this include: 

• High profile promotion of the benefits of local procurement to the business community and to SMEs in the City fringes
• Continuing "lower level" promotion of the benefits of local procurement through business organisations and the press
• Recruiting "local procurement champions" within City business to highlight the impact of local procurement and the benefits it has brought to their company. Word of mouth is a powerful medium and local procurement champions can "tell their story" to peers in other companies highlighting key economic and social benefits.
• Encouraging active involvement of SMEs based in the City fringes (and especially those that are not current part of established programmes) through awareness programme delivered by business support organisations at which City businesses have a part to play.

Making the right contacts

As a buyer it is always easier to do business with a company and individuals that you know and trust to perform. Knowing the right people to contact and what they are able to offer is critical. Active involvement of City business in local procurement can be encouraged by making Buyers aware of who the suppliers are - and where to find them

There are a number of effective ways of bringing buyers and sellers together - many of which are focused on marketing and networking events. These can include:

• "Meet the buyer" events at which City buyers are able to outline their different procurement needs and have the opportunity to meet local suppliers with a range of products and services that can meet these needs
• "Meet the seller" events at which sellers have the opportunity to showcase their products and services and demonstrate to City buyers the ways in which they are able to meet the needs of City businesses
• Roundtable discussions at which buyers and sellers are able to discuss the benefits and challenges of local procurement and think about solutions

None of these should be seen as a "magic solution". Rather, they will help to start the development of a relationship - not necessarily result in immediate contracts! But making the most of these events is critical. Buyers need to be clear about their requirements and ways of purchasing just as suppliers need to be clear about the products and services they offer and their ability to meet contractual terms
 
Providing the right training and support to SMEs

All SMEs are at different stages of their development as businesses and it is important to provide the training and support that is relevant to them and that will enable them to supply the City. Information and input from City businesses will be critical to some of the programmes - bringing the business dimension. For example information on different procurement practices as well as requirements for accreditation is vital to the development of relevant programmes.

Some of the areas for training and support that were highlighted during the evaluation included:

• Understanding different procurement practices adopted by City businesses (preferred framework agreement, suppliers list, open tender, reactive procurement etc) how to meet the requirements of these practices.
• Gaining the accreditation required by City businesses
• Understanding how to manage relationships with City buyers - and the difference between maintaining regular (effective) contact and excessive contact
• Training on how to maximise the benefit of networking events / trade fairs

At the same time the recommendations recognised the different stages of development of SMEs and their different needs. Training and support should reflect this and be delivered in different ways to suit the SME. These could include:

• Workshops that are focused on key aspects of selling to the City rather than general business principles
• One-to-one business support to help SMEs to develop contacts / promote their products and services
• One-to-one support for SMEs engaged in contract development / formal negotiation and delivery

For more information on Selling to the City, please contact David Pack on 0207 332 1268 or email david.pack@cityoflondon.gov.uk

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