Analysing the Success Factors of SMEs on Public Procurement

Indonesia is catching up with infrastructure development as a developing country. This is an opportunity for large and small contractors, especially construction services to compete for development projects. In the process, the government held a tender for SMEs participating in government projects. In the government tender process there are many obstacles that can affect SMEs to participate and win the government tender process. One of them is more than 50% of the value of tenders under 2.5 billion rupiahs but it cannot be done by choosing directly so that SMEs become difficult to be involved in the government procurement tender process. In this study we will discuss the factors and constraints that affect construction SMEs to participate in public procurement. Factors and obstacles include two main factors, namely the internal SMEs and external factors from the government. The method used is the Partial Least Square analysis method which is doing descriptive statistical analysis and causal analysis that aims to find out whether the factors that influence and become obstacles for SMEs to participate in public procurement.