Differences Between Public and Private Sector Procurement – Business Drivers

Business Drivers

A perhaps more subtle difference between public and private sector procurement lies in the key overriding considerations that drive procurement and contracting decisions.

business drivers
In the private sector, where the primary procurement focus is profitability, the bottom-line analysis is generally the determining factor when procurement and contracting decisions are made. The public sector, on the other hand, is responsible for providing effective and efficient services to the public; the primary emphasis, therefore is on the public need, not profit.  This often means that a service or program that would not otherwise be available in the marketplace may be provided and/or developed to meet the needs of the public, even though such a procurement decision would not be considered ‘profitable’ in the eyes of the private sector.

One example that comes to mind would be British Columbia’s Community Assistance Program aimed to help the most vulnerable income assistance clients improve their quality of life and connect with services in their communities. Delivered by contracted service providers in 50 communities throughout the province, the program helps individuals develop positive life skills and connects them with mental health, housing, substance dependence treatment, legal aid and family services.

Other articles in this series: Introduction, Trade Agreements, General Transparency

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