Price competition on the Moscow suppliers website is growing largely due to the implementation of digital technology for purchasing, said Gennady Dyogtev, Head of the Moscow Department for Competition Policy.
The website’s main advantages are that it allows instant accreditation and does not require advance application or deposits, he added.
“Digitalisation contributes to an increase in competition,” Dyogtev said. “And Moscow’s procurement market exemplifies this well. Every day up to 700 RFQ (request for quotation) sessions are held via the Moscow suppliers website. One can participate in them from anywhere in the country, exactly what entrepreneurs have been successful at doing, all the while competing against each other. Over 100,000 suppliers from all of Russia’s regions are taking advantage of the opportunities provided by the Moscow state suppliers website for small purchases. The figures speak for themselves: this instrument is trustworthy and in high demand. Over the past four years, a total of over 1.5 million contracts have been signed, with a total of 3 million offers that suppliers can currently bid on. 86 percent of suppliers registered on this website are small business owners.”
Today, the suppliers website is increasing competition not only in Moscow, but outside as well, he added.
“Moscow was able to offer the rest of the regions an infrastructure for conducting small purchases that had already been tested,” Dyogtev said. “Having evaluated the results obtained from Moscow, most of Russia’s constituent entities supported this proposal. Over the course of the past seven years, the volume of purchases made from small businesses by vendors located in Moscow has increased tenfold – from 27 billion up to 273 billion roubles, while the share of purchases made from small businesses has increased from four to 37 percent.”
Eighteen percent of all purchases made via the Moscow suppliers website are services – from the beginning of this year, a total of 8,500 services have been provided. Every contract concluded with the city of Moscow had at least five participants bidding on it. Due to such competition, the initial price offerings can drop by as much as 29 percent. The list of the most popular services includes contracts for equipment and sanitary maintenance, waste collection and cleaning services.