Assessment of The Role of E-Procurement on Development of Small and Medium Enterprises in Local Government Authorities.

Abstract

The aim of this study was to assess the role of e-procurement on development of SME’S in LGA in Tanzania using Songea Municipal Council as a case study. A descriptive study research design and a mixed research approach was used in this study. The study population included suppliers from different procurement categories. The sample size was 104 who were selected using a purposive and simple random sampling technique. The questionnaire, interview and documentary review were used to collect data. Descriptive statistics were used to analyze quantitative data and content analysis was used to analyze the qualitative data collected from participants in order to decode their meaning. The study concluded that e-tendering increases competitiveness of the procurement process. However, most SMEs lack an online supplier contract management system that facilitates tendering processes. It was established that e-tendering has improved customer satisfaction. In the second objective, the study concluded that E-sourcing has improved performance of the business. Adoption of e-sourcing enables businesses to generate savings from their supply chains, to increase the visibility of crucial business information and reduce the time required to accomplish procurement tasks. In the last objective, the study concluded that E- payment system offers a convenient means of making payments.This increases the effectiveness of the supply chain and increases information and transparency. By speeding up payments, e- payment speed ups the procurement and ensures timely delivery of goods, which subsequently improves customer satisfaction. It is recommended that SMEs should adopt and utilize e-tendering to streamline the process of procurement and reduce the costs involved. The study found adoption of electronic payment by all SMEs in Tanzania so as to ensure easy, fast and safe transactions hence increasing the level of customer satisfaction. The study further recommends that all SMEs should adopt e- payment to improve performance by improving efficiency in payments and reducing errors related to cash transactions.