From consortium tendering to SMEs’ participation in public procurement markets: do procedural capabilities intervene?

Abstract

This study examines the effect of consortium tendering (CST) on the participation of SME in public procurement markets (PPM) with a particular focus on the mediating role of procedural capabilities (PRC). Data collection was done using a structured cross-sectional questionnaire survey that was randomly distributed to 283 SMEs within the context of Tanzania. The proposed model hypotheses were tested using Hayes PROCESS macro. The study results showed a significant positive effect of CST on SME’s PRC and their engagement in PPM. Further, PRC revealed a significant positive effect on SME participation in PPM. The notable finding of the study is that PRC serve as a mechanism through which CST influences SME participation in PPM. Accordingly, the study suggests designing digital platforms that can connect SMEs with large companies and their peers, offer specific training and mentorship programmes on the aspect of CST and the procedural nature of PPM. The study makes a novel contribution to literature on public procurement and competitiveness by integrating insights of CST and PRC to explain SMEs’ involvement in PPM. The study findings hold relevance for policymakers, oversight authorities and support institutions seeking ways to enhance strategies towards inclusive participation of SMEs in PPM.