From bureaucracy to collaboration: emerging tactics to enhance customer attractiveness in the public sector Open Access

Public procurement plays a crucial role in society, yet public buyers often face challenges in attracting and maintaining supplier interest due to regulatory constraints and procedural formalities (Bergman and Lundberg, 2013). Unlike in the private sector, where customer attractiveness is influenced by relational dynamics and long-term collaboration, public buyers operate within strict regulatory frameworks that may hinder supplier engagement (Boyne, 2002; Uenk and Telgen, 2019; Parker and Hartley, 1997). Despite these constraints, suppliers’ perception of public customers can significantly influence the effort they put into the relationship, ultimately affecting the overall effectiveness of public procurement.

When suppliers perceive a customer organization favorably, they are more likely to reduce costs (Bemelmans et al., 2015; Patrucco et al., 2019), allocate scarce capacity (Schiele and Vos, 2015; Reichenbachs et al., 2017), share innovations (Schiele, 2012; Ellis et al., 2012) and invest in relationship-specific developments (Fridner, 2023; Makkonen et al., 2016). Customer attractiveness, defined as the positive perception a supplier maintains toward a customer organization, has therefore emerged as a crucial determinant of supply chain performance (Kragh et al., 2022). Research on its drivers has found that it is influenced by customer behaviors such as clear communication, long-term commitment, timely feedback, equitable terms and collaborative problem-solving (Hald et al., 2009; La Rocca et al., 2012; Bemelmans et al., 2015; Pulles et al., 2016). These behaviors foster trust, reduce uncertainty and create joint benefits, thereby enhancing customer attractiveness.

A limitation of previous research is that it has primarily examined the behaviors leading to customer attractiveness in the private sector (Schiele, 2012). Public customers face different challenges than their private sector peers due to democratic governance, which imposes strict rules and regulations, potentially impeding supplier interactions (Bergman and Lundberg, 2013; EUa, 2023). The public organizations’ emphasis on democratic control and public accountability (Boyne, 2002) is leading to a reputation of being overly bureaucratic business partners (Uenk and Telgen, 2019), in contrast to the competitive and economic efficiency focus in the private sector (Parker and Hartley, 1997). Boyne’s extensive review of public–private differences highlights that public organizations tend to operate with more formalized procedures, exhibit less flexibility and demonstrate greater risk aversion due to higher levels of scrutiny and accountability demands. These institutional constraints are empirically supported across multiple studies and create distinctive organizational environments and managerial approaches that can significantly hinder relationship development with suppliers, a key facet of building attractiveness (Grandia, 2018; McKevitt and Davis, 2014; Makkonen et al., 2016). Consequently, public customers often struggle to appeal to suppliers during the tender phase and subsequent relationships (Jääskeläinen and Tukiainen, 2019; Onur and Onur, 2019; Purchase et al., 2009).

Despite these specific challenges, research has paid limited attention to the public customer perspective (Fridner, 2025; Schiele, 2012). This underrepresentation is particularly problematic given the economic weight of public procurement, which amounts to 13% of GDP across OECD nations (OECD, 2023). Beyond its scale, public procurement is also a strategic policy instrument, increasingly expected to stimulate economic activity, promote sustainable development and support broader social objectives (Grandia and Voncken, 2019; Lenderink et al., 2022).

This paper aims to enhance our understanding of how public customers can become more attractive to their suppliers by examining the tactics they use to strengthen their appeal to suppliers and manage institutional constraints.

The following research question guides us:

We address this research question through qualitative investigations into three major public organizations, examining both the tender phase and subsequent business relationship. The study builds on semistructured interviews with 18 informants, observational sessions and secondary data, which are analyzed using a reflexive thematic approach. This comprehensive examination provides a rich understanding of how public buyers navigate unique challenges to enhance their attractiveness to suppliers.

The findings hold significant implications for both research and practice, enhancing our theoretical understanding of public procurement while providing practical guidance for public organizations. This research contributes by shedding light on the special conditions facing public customers and the approaches they use to address the challenges of regulations and institutional logic to improve their attractiveness to suppliers. Furthermore, our findings tentatively suggest that the four identified tactics may be understood through three overarching strategies: adaptation to private sector norms, compensation for unattractive features stemming from public sector limitations and circumvention of certain rules and regulations. While these strategies offer a useful lens for understanding how public customers navigate the complex demands of the public sector, they remain tentative observations that warrant further exploration, as discussed in the limitations and future research sections.

In line with previous research, we view customer attractiveness as an umbrella concept that encapsulates past and present interactions, as well as a future-oriented dimension (Kragh et al., 2022; Tanskanen and Aminoff, 2015; Tóth et al., 2015). We adhere to the identified need to distinguish between ex ante expectations and ex post satisfaction (Hüttinger et al., 2012; Pulles et al., 2016; Schiele, 2012) by differentiating between the initiation and continuation of the relationship. Customer attractiveness in this view is based on expectations before the start of a business arrangement and is subsequently complemented by the experience of working with the customer as a relationship develops.

To initiate a relationship, the supplier must have sufficiently positive expectations of what a future business arrangement with the customer will entail (Hüttinger et al., 2012). As there is a lack of first-hand experience in dealing with the customer, the supplier’s selection relies on company characteristics, reputation and prebusiness interactions along with the procurement documents. Research highlights that direct economic aspects, such as volume on offer and growth potential, as well as indirect benefits such as reference value or market access, will be important considerations for the supplier (Hüttinger et al., 2012; Kragh et al., 2022; Nollet et al., 2012). As a consequence, large customer organizations may be inherently attractive to most suppliers, while a newly established firm may need to reach out to the supply market to raise awareness of its existence (Nollet et al., 2012).

As noted by Pulles et al. (2019), the literature is scarce in terms of how a customer can actively promote itself in the supply market at this initial stage. This scarcity in the literature can be explained by the fact that an exchange can begin at a small scale in the private sector and then be continuously modified and expanded. However, Nollet et al. (2012) suggests a number of possible tactics customers can use to raise suppliers’ interest, including managing impressions through social interaction; actively reaching out to the supplier in various forums (e.g. top management meetings, field contacts and events), adopting a pleasant attitude and showing a sincere interest in the supplier’s long-term plans. Hüttinger et al. (2012) present a similar line of reasoning when mentioning extensive face-to-face contact and personal relations as relevant social factors to initiate attraction in the early phase of a relationship. Furthermore, the customer is advised to investigate the specific needs of individual suppliers and put forward the distinct advantages of the offering vis-à-vis alternative customers (Nollet et al., 2012; Kragh et al., 2022).

Once the relationship has been initiated, the goal in terms of customer attractiveness is to meet the expectations raised in the initial phase and to continuously nurture the relationship. The outcome of the exchange for the supplier will be measured against comparison levels that incorporate both input versus output and benchmarks to alternative customers (Thibaut and Kelley, 1959). In conjunction with updated expectations, the resulting level of supplier (dis)satisfaction dictates where the customer falls on a spectrum ranging from preferred to “exit” customer (Reichenbachs et al., 2017; Schiele, 2012). Operational performance is an important factor here, particularly in terms of how smoothly the customer manages ordering, invoicing and delivery processes (Essig and Amann, 2009; Nollet et al., 2012; Schiele, 2012). The emphasis should be on limiting hassles and additional costs for the supplier: avoiding inefficiencies and streamlining administrative procedures.

As the relationship continues, trust, strategic compatibility and relational quality become important attributes for customers seeking improved standing with a supplier (Hald et al., 2009; Makkonen et al., 2016; Nollet et al., 2012). Research highlights that a relationship-based supply management strategy, which prioritizes cooperation over competition, fosters a more favorable perception of the customer (Wong, 2000; Forker and Stannack, 2000; Benton and Maloni, 2005; Nyaga et al., 2010). Maintaining and strengthening social bonds is essential, as studies emphasize the importance of developing multilayered personal connections across different positions in the customer-supplier dyad (Hald, 2012; Tanskanen and Aminoff, 2015). Other important areas to sustain and increase customer attractiveness include demonstrating commitment through investments in transaction-specific assets, engaging in intensive communication and developing an organizational culture where suppliers feel valued (Hald et al., 2009; Nollet et al., 2012). Building on this, Makkonen et al. (2016) emphasize that as the relationship matures, customer attractiveness is increasingly dependent on communication, collaboration, mutual adaptations and shared goals. While such behaviors are central to building attractiveness in the private sector, public customers operate under institutional constraints that limit their ability to implement them, necessitating distinctly different approaches, as we discuss next.

In contrast to most procurement in the private sector, public procurement is built on competition among several suppliers on a level playing field, leaving limited opportunity to tailor an offering to any specific supplier. The EU public procurement directives stipulate that all suppliers (in the EU) should have the opportunity to respond to open tenders, and the legal framework is built to stimulate transparency and equal treatment (EUb, 2023). The tender process follows a highly formalized structure, often conducted through an electronic interface (Kelly et al., 2021). This may impede the ability of public customers to build rapport with suppliers and can act as a barrier to initial attraction, given the prominent role of social interaction already at this early stage.

Another consequence of the rigidness and bureaucracy of public tendering is high entry barriers (Loader, 2015), which are not featured prominently in the research on the private sector (Hüttinger et al., 2012). The difficulty that small suppliers, in particular, experience when entering the public market is widely reported (Akenroye et al., 2019; Woldesenbet and Worthington, 2019). The public context also distinguishes itself in terms of the maneuverability a customer has to influence economic factors; while a private customer can build attraction by offering long-term growth opportunities and deciding on nonadversarial pricing negotiations, these approaches are less available to public customers. In terms of long-term growth opportunities, expected future value beyond the current contract always faces the uncertainty of mandatory renewed competition for a supplier to the public sector, and the price level is usually not set by the public customer in negotiation with individual suppliers but is instead the result of a competitive tendering process (Grandia, 2018; Schiele, 2012). These constraints often make public contracts less attractive to suppliers, particularly those who have alternative opportunities in the private sector (Fridner, 2023).

Altogether, public customers operate in a framework that promotes competition rather than cooperation (Steane and Walker, 2000; Uenk and Telgen, 2019). Due to the short-term nature of public tendering and arguably, the legislative emphasis on equal treatment, the relationship between public clients and suppliers is usually characterized as “arm’s length” or “transactional” (Uenk and Telgen, 2019). This contradicts much of what we learn about how attractiveness is built and maintained in relationships, as indicated by the emphasis on a relationship-based supply management strategy. This is further supported by one of the few studies on customer attractiveness in the public domain, where Schiele (2012) finds that a public customer’s relational treatment – such as fairness, flexibility and helpfulness – is critical to how suppliers perceive them. Similarly, recent research highlights that while public procurement is constrained by regulatory frameworks, efforts to improve transparency, proactivity and communication can positively influence supplier engagement (Holma et al., 2022; Karttunen et al., 2022; Kelly et al., 2021).

Despite the growing research on customer attractiveness in the public sector (Karttunen et al., 2022; Kelly et al., 2021; Schiele, 2012), our understanding remains limited, especially regarding the specific actions public customers can use. While a few studies mention practices such as early supplier engagement and the simplification of tender documentation, these remain scattered and not yet systematically explored (Holma et al., 2022; Karttunen et al., 2022). Therefore, further investigation in this area is warranted.

Given the exploratory nature of the aim and research question, a qualitative approach was chosen. Qualitative methods are particularly suited for studies seeking to understand perceptions, motivations and social dynamics (Dubois and Gadde, 2002; Yin, 2009, p. 52). Since customer attractiveness is relational and context-dependent, this approach allows for a nuanced exploration of organizational practices that shape attractiveness dynamics.

The study included interviews and secondary data from three major Swedish public organizations with substantial procurement activities (Alpha, Beta and Gamma). These were selected using a purposeful sampling strategy focused on information-rich cases (Patton, 2002, pp. 230-246). Case selection was informed in part by a prestudy conducted during the early stages of the project, which included five interviews with procurement professionals and sector experts from the National Agency for Public Procurement and another large public organization (anonymous). This prestudy also involved an analysis of written materials such as supplier preference reports and public customer guidance documents. Based on the insights gathered, we prioritized access to organizations that were seen as advanced in their supplier engagement efforts and actively exploring supplier-oriented practices. The selected organizations differed in governance level (governmental, regional and municipal) but all shared heavy reliance on suppliers, high purchasing spend and coordinated supply management structures, including category strategies guiding supplier interactions.

Data was collected through semistructured interviews guided by an interview framework addressing general questions on customer attractiveness management, supplier perceptions and management of customer attractiveness across different phases of the supplier lifecycle. The interview guide was adapted based on prior interviews, the informant’s position and relevant secondary data.

Eighteen interviews were conducted for the main study. Informants were recruited after the organizations distributed general information about the study internally. We then contacted participants directly, without management involvement, to preserve openness and autonomy. Informants were selected based on their extensive experience in supplier relations and their diverse functional responsibilities to gain different perspectives on the research phenomenon. The sample included individuals with primary responsibility in both the tender phase and the relationship phase, as well as those with a more holistic view of supplier interfaces. Table 1 details the informants. The interview data was supplemented by secondary data from participating organizations, including strategy documents, market analysis and supplier satisfaction surveys. Several meetings were held with each case organization to discuss emerging results and upcoming queries. We also attended supplier meetings, conferences and “Meet the buyer” sessions with the organizations, where we had a passive role and took field notes. These additional data sources were not used for formal triangulation, but served to enrich and contextualize the interview material. Data collection was concluded when further data resulted in limited additional understanding.

Following Braun and Clarke’s (2006) reflexive thematic analysis guidelines, the first step involved familiarizing ourselves with the data through repeated readings and the notation of initial ideas. Data was uploaded to NVivo, and each source was tagged by its affiliated organization. The coding began by identifying activities aimed at generating attractiveness, which were then categorized according to the tender and relationship phases. A thematic analysis was then performed on two levels. First, similar activities were grouped into “attraction-building activities.” Second, these attraction-building activities were further aggregated into broader “tactics” – a set of activities that share the same goal. Through this analytical process, we identified 14 attraction-building activities, each pertaining to one of four tactics. Two of the tactics are related to the tender phase, and two are related to the relationship phase. Subsequently, the rationale behind these attraction-building activities and tactics was analyzed by rereading and examining the context and challenges associated with each attraction-building activity. Insights from documents and observations were used to enrich this interpretive process, particularly by grounding abstract themes in practical routines, terminology and observed interaction patterns. The whole process involved continuous recoding, theme redrafting and ongoing revisions.

In this section, we first describe the public-specific challenges for the tender and relationship phase, respectively, before discussing the identified tactics and their underlying attraction-building activities. See Figure 1 for a schematic of the phases. These findings directly address our research question by identifying the tactics public customers use to enhance customer attractiveness during both the tender and relationship phases.

The tactics are grouped based on their primary purpose and timing. The tender-phase tactics – “spark interest” and “simplify entry” – focus on attracting supplier attention and reducing entry barriers before contract award. The relationship-phase tactics – “foster connections” and “reinforce engagements” – aim to strengthen ongoing collaboration and reward desirable supplier behaviors. While some activities may indirectly support multiple phases, the categorization reflects the focal point of organizational effort.

Informants agreed that enhancing attractiveness was crucial for organizational success, with prioritized activities supporting this goal. The operational process has two phases: first, converting potential bidders into actual bidders while encouraging unsuccessful bidders to participate in future tenders; second, building productive relationships with selected suppliers that also encourage repeat bids. The organizations devoted significant resources to both the tender and the relationship phases.

The main reason informants worked with attractiveness in the first phase was to attract a sufficient number of bidders. Stimulating competition by attracting many bidders was seen as a necessity given the operating framework of public procurement, along with other factors such as the need to overcome capacity shortages and the desire to avoid supplier consolidation.

Three main challenges were noted in the pursuit of attracting more bidders, all related to the conditions of the public sector context. The first challenge was the selectiveness of suppliers. Despite the customer organization’s significant spend, size could not be leveraged to coerce suppliers to participate across multiple tenders. Instead, given that each tender is assessed in isolation, some suppliers were viewed to be highly selective in what procurements they would bid for, and why each procurement needed to be sufficiently attractive in its own right. The second challenge related to the regulatory bar on negotiating with individual suppliers, along with the mandatory exposure to repeated competition, which meant that it was not enough to be attractive to secure commitment from a selection of key suppliers. The third main challenge was the poor image of public customers. While there was recognition that certain attributes associated with the public sector were appreciated by suppliers, such as low market volatility and financial stability, the overall view was believed to be rather negative. A goal for the buyers was thus to improve their image as customers, especially in relation to new suppliers.

Below, we present two tactics used by public customers to enhance their attractiveness during the tender phase, addressing the part of our research question concerned with how they appeal to suppliers before a contract is signed. The first tactic, spark interest, involves proactively generating supplier attention and interest. The second, simplify entry, focuses on lowering barriers for suppliers to participate in tenders. Each tactic comprises a set of underlying activities, which we outline and explain in the following subsections.

In our analysis of activities to enhance attractiveness during the tender phase, we identified several activities that can be categorized as a tactic to spark interest. By this, we mean engaging potential suppliers early and proactively to generate initial interest and enthusiasm for future business opportunities. By engaging in extensive interactions with potential suppliers before an offer has been formalized, the organizations were less restricted by the regulatory framework of public procurement. Four attraction-building activities underpin this tactic: (1) proactive outreach to new supplier markets, (2) early promotion of business opportunities, (3) extensive information gathering and (4) encouraging rejected suppliers.

The first activity we identified, proactive outreach to new supplier markets, refers to raising awareness and interest among suppliers that do not have a history with the organization. While the customers we studied are well-known within their home markets, they sought to broaden the potential supply pool by actively reaching out to new supplier markets through, for example, promotional tours (domestically or abroad), the translation of business opportunities to foreign languages and engaging industry representatives. Apart from targeting suppliers in new geographical areas, the organizations also arranged information sessions for suppliers new to public procurement, such as SMEs and start-ups. In attending these gatherings, we observed that the communication included both upcoming business opportunities and the message that they were keen on developing an atmosphere of good relationships with suppliers. Another aspect brought up by informants was that the rigidness of public sector contracts elevated the importance of conveying an image of competence, as pointed out in the following:

The second activity we identified, early promotion of business opportunities, refers to communicating forthcoming tenders well in advance to give suppliers time to plan and build expectations of future value. While the formal tender period may be short, these organizations actively share information months or even years ahead to signal upcoming needs and reduce uncertainty in the supply market, as explained by one informant:

This approach was intended to support supplier planning while signaling transparency and long-term orientation, all of which were seen as elements of customer attractiveness.

The third activity we identified, extensive information gathering, refers to gathering knowledge of suppliers’ preferences. This includes market analysis, hearings, bid surveys, collaborations with industry associations and procurement drafts sent on referrals. Several informants also noted that meeting the suppliers individually, as a complement to broader channels, was important due to the fact that valuable information would not be shared in the presence of competitors. The informants were virtually unanimous in the view that extensive pretender information gathering is essential to allow for responsiveness to supplier’s needs in ways that would not be possible later in the formal procurement phase. As the Head of category management at Alpha explained:

The fourth activity we identified, encouraging rejected suppliers to compete for the next business opportunity, refers to engaging with unsuccessful bidders to explain the outcome and maintain their interest in future tenders. This practice aims both to increase the likelihood of future participation and to reduce the risk of legal challenges that may delay or complicate contract execution, as one informant explained:

One reason for reaching out to rejected suppliers, other than encouraging them to submit bids for the next contract, was to reduce their inclination to file for legal review. Reducing the dissatisfaction of the rejected suppliers mitigates the risk that they will negatively influence the accepted supplier’s satisfaction with the customer.

According to our informants, a major barrier to the formation of initial attraction is the relatively high entry costs stemming from the need to understand the legal framework, complicated tender requirements and the work needed to produce a bid. The customers dedicated significant resources to lowering these initial costs. Simplifying entry here means lowering the barriers to entry for potential suppliers, making it easier for them to participate in tenders. We noted the following underlying attraction-building activities: (1) cleansing procurement documents, (2) modularizing tenders, (3) packaging tenders and (4) educating potential and new suppliers.

The first attraction-building activity, cleansing procurement documents, concerns the attempt to simplify tenders by removing redundant and overly complex requests, a process conditioned on the information exchange described in the above section. Using a washing machine as a metaphor, one respondent explained:

The metaphor illustrates how simplification was used to make tenders more accessible, while still requiring judgment to avoid removing relevant content. While the informants agreed on the need not to burden suppliers with too many demands, there was less agreement on whether this translated into steering toward function (job to be done) in the tender documents. The organizations generally sought a goal-oriented approach, but the informants working in the tender phase stated that not detailing how the suppliers were supposed to perform the job could make it more difficult for them to understand the evaluation criteria and selection process, as exemplified by the following:

The second activity we identified, modularizing tenders, refers to structuring tender invitations so that suppliers can bid on parts of a contract and gradually scale their capacity postaward. This approach is used to attract suppliers of different sizes and maturity levels by lowering entry barriers and allowing suppliers to meet certain requirements gradually over time, as one informant explained:

The third attraction-building activity we identified, packaging tenders, involves making tender documents more accessible and appealing by improving their structure and language. This includes reducing legal complexity and tailoring the content to the intended audience. As the Procurement Manager of Gamma explained:

The fourth attraction-building activity we identified is educating potential and new suppliers. This means helping suppliers understand how public procurement works and how to submit a tender. By doing so, the organizations aimed to lower entry barriers and reduce the informational advantage that incumbent suppliers often have. They achieved this by being transparent and open when discussing the details of the business arrangement with new suppliers. Beta went a step further by occasionally allowing suppliers to respond to past tenders, allowing them to gauge their competitiveness against previous competitors. Additionally, all of the organizations engaged in educational initiatives to support small suppliers or those primarily serving private customers, as noted by the Head of Supplier Relations at Beta:

These efforts were intended to facilitate a smoother transition so that these suppliers could bid for public contracts.

The goal of the relationship phase was to foster a productive relationship and lay the ground for the supplier to participate in subsequent offers. The challenges expressed again revolved around the bureaucratic nature of public procurement. Moreover, the legal and administrative constraints in the public sector make it difficult to replace a supplier mid-contract, which reinforced the need to foster positive collaborations.

A major problem highlighted by the respondents was the suppliers’ skepticism of the public customer’s ability to build a relationship with a collaborative atmosphere. The Head of Division at Alpha described the tradition of clinical interactions in the public sector as the source of such perceptions:

This view was similarly expressed by the Head of Supplier Relations at Beta:

These quotes illustrate how public buyers themselves identified a need to change long-standing organizational habits that may undermine supplier trust and motivation. To counter this legacy and overcome the built-in rigidities of legislation and organizational tradition, the informants described a number of concrete efforts aimed at sustaining supplier motivation and engagement throughout the contract period. These efforts address the part of our research question that concerns how public customers enhance their attractiveness during the relationship phase.

Below, we present two tactics through which this is achieved. The first, foster connections, focuses on building and maintaining strong relationships with suppliers. The second, reinforce engagements, involves deepening cooperation with well-performing suppliers over time. Each tactic comprises a set of underlying activities, which we outline and explain in the following subsections.

Several of our informants said that their organizations work actively to nurture collaboration and deepen the relational bonds with the suppliers postcontract award, a tactic we denote foster connections. We noted the following underlying attraction-building activities behind this tactic: (1) bridging from tender- to collaboration phase, (2) contracting collaboration and (3) emphasizing social interactions.

The first attraction-building activity we identified is bridging from the tender phase to the collaboration phase. This refers to actively using the transition between contract award and the start of delivery to build supplier confidence, clarify mutual expectations and overcome potential scepticism.

Informants highlighted the importance of prioritizing support and alignment during the initial meetings with suppliers, thus ensuring a shared understanding of the way forward. This approach was believed to be appreciated by suppliers, as indicated in the following quote:

A second attraction-building activity, contracting collaboration, entailed detailing required collaborative elements such as shared incentive structures, escalation processes, joint marketing activities and the establishment of a minimum frequency of meetings. The customers usually pushed for this type of inclusion, as illustrated by the informant below:

Some informants indicated that this kind of formalization is especially important at the beginning of the business relationship.

The third attraction-building activity we identified is emphasizing social interactions. This refers to deliberately fostering informal and personal contact with suppliers to build relational bonds and present the organization as approachable and trustworthy. The social aspects of the relationship were viewed as important for a productive relationship and to be perceived as a friendly customer organization, as illustrated by the following quote:

In this regard, the informants emphasized that meeting suppliers in person was crucial rather than relying solely on digital interfaces. The organizations also sought to expand their social ties by involving employees from different functions and meeting existing suppliers in forums that were not tied to any specific existing business. This was seen as a tool for overcoming legal barriers and interacting more freely with the suppliers.

To this point, informants emphasized that reducing fear among employees regarding legal repercussions was crucial to facilitate more open supplier interactions, thereby making the organization a more appealing business partner. Several informants described how overly strict interpretations of regulations hindered necessary social interactions, highlighting the importance of shifting this mindset, as exemplified by the following quote:

The informants agreed that they needed to change from the default mode of public customers, to distance themselves from suppliers and instead advocated for informal social interactions. One organization, Alpha, created educational materials to distribute to its employees to this end.

In different ways, all organizations worked actively toward being responsive to the supplier’s performance to reward and increase commitment to well-performing suppliers. By reinforcing engagements, we mean promoting a cycle of positive interactions and rewards for well-performing suppliers, encouraging continued excellence. We noted the following underlying attraction-building activities: (1) tracking and sharing performance data, (2) goal-oriented steering and (3) rewarding well-performing suppliers.

The first attraction-building activity, tracking and sharing performance data, refers to developing metrics and processes for performance evaluation and feedback. Informants emphasized that this activity is not solely used for internal control but also serves to demonstrate professionalism and responsiveness in interactions with suppliers. For example, performance data is used in meetings to support dialogue and joint understanding. This approach can signal competence, fairness and commitment – qualities believed to increase customer attractiveness. One respondent described the principle behind this practice as follows:

Other informants described that, in the context of public procurement, monitoring can instead be a prerequisite to being perceived as a trustworthy customer. The reasoning behind this is that if the supplier realizes that they – and by proxy their competitors – are not allowed to cut corners postaward, this increases their perception that the customer provides a fair competitive environment. The informant below further details this:

There were also instances in the interviews where the practice of careful monitoring was described to enable the organizations to generate indirect supplier value that can improve the supplier’s status with other customers, as explained by the Head of Division, Alpha:

The second attraction-building activity we identified is goal-oriented steering. This refers to designing contracts and procurement processes in ways that reward desirable supplier behavior, such as high performance, responsiveness or collaboration. While this typically applied to ongoing contracts, Beta had taken it one step further by launching a pilot project where past performance influenced the chances of winning future tenders. This introduced some legal uncertainty, as discussed by a Supplier Development Manager at Beta:

Beta and Alpha also began a reversed form of systematic tracking in which the suppliers get to score them as customers. In both cases, this is done through annual or bi-annual supplier satisfaction surveys, complemented by structured formats to collect the suppliers’ opinions on individual projects and procurements.

The third attraction-building activity, rewarding well-performing suppliers, means going beyond the confines of any single contract and giving special treatment to preferred suppliers. One of the ways Beta does this is through supplier segmentation, where A-suppliers get additional benefits in the form of supplier relations teams dedicated to nurturing the relationship with these individual suppliers. This is made possible by separating the special treatment from any specific procurement or project. It is also feasible due to the vast number of different projects Beta circulates, which provides needed stability for A-suppliers that would not be the case if the loss of any single contract would jeopardize the classification. Beta also holds strategic meetings with A-suppliers, as explained by the Head of Investment Unit, Beta:

The other organizations did not segment suppliers in any formal way but engaged in informal activities with selected suppliers, as outlined by the Head of Subdivision at Alpha:

On a similar note, there were examples in the material where well-performing suppliers received better opportunities to promote their business at exhibitions and various events, although this type of selection was, in the mentioned cases, done under the radar.

The following Table 2 provides an overview of the four key tactics public sector customers use to enhance their attractiveness to suppliers. Each tactic is supported by specific activities, with corresponding examples illustrating how these approaches are applied in practice.

Public procurement plays a vital role in society, yet public buyers often struggle to attract and retain high-quality suppliers due to institutional constraints and bureaucratic complexities. While previous research has recognized these challenges (Fridner, 2023; Onur and Onur, 2019; Uenk and Telgen, 2019), less attention has been given to how public buyers actively shape their attractiveness within these constraints. This study addresses this gap by examining the strategic actions public procurement organizations use to foster supplier engagement. Specifically, we asked how public customers enhance their attractiveness to suppliers during both the tender and the relationship phases.

Our findings suggest that public buyers do not merely comply with rigid institutional frameworks but actively shape supplier engagement through four key tactics – spark interest, simplify entry, foster connections and reinforce engagements. The first two relate to the tender phase and the last two to the relationship phase. These tactics unfold across two phases. In the tendering phase, our results underscore that spark interest and simplify entry are essential for reducing supplier concerns about administrative complexity and accessibility. Public buyers address these challenges by clarifying procurement requirements, modularizing tenders and offering supplier education. These findings highlight that even in highly regulated environments, public buyers can take proactive steps to improve supplier perceptions and broaden their potential supplier base. During the relationship phase, foster connections and reinforce engagements play a crucial role in strengthening supplier commitment by fostering trust and stability. Structured postaward interactions – such as transparent performance evaluations, debriefings and collaborative dialogues – signal reliability and reduce supplier uncertainty. This suggests that relational governance mechanisms, often associated with private-sector procurement, can also be leveraged within public procurement despite regulatory constraints (Grandia, 2018; Schiele, 2012).

Taken together, our findings challenge the notion that public procurement must be strictly transactional. Instead, they illustrate that public buyers use structured relational efforts alongside procedural fairness and regulatory compliance to enhance supplier engagement. By balancing standardization with relationship-building, public buyers not only mitigate supplier risks but also encourage long-term engagement. This strategic balancing act is reflected in the four tactics identified in this study, which clarify how public customers enhance their attractiveness – by addressing both phases of the process: attracting suppliers in the tender phase and sustaining engagement in the relationship phase.

This study set out to examine how public buyers strengthen their attractiveness to suppliers under the institutional conditions of public procurement. In doing so, it contributes to research on customer attractiveness and relational governance by offering a structured account of how such efforts unfold across both the tender and the relationship phases. Building on the four identified tactics, the analysis shows how public buyers act strategically to engage suppliers across both formal and relational dimensions. The study thus moves beyond prevailing views of public procurement as predominantly bureaucratic by highlighting purposeful, long-term relationship-building.

More specifically, our results empirically validate prior assertions (e.g. Schiele, 2012) that public buyers can implement tactics commonly associated with private-sector procurement – such as reducing entry barriers and fostering relational engagement – to enhance customer attractiveness despite legal constraints on financial incentives and negotiations. While Schiele proposed that performance-based contracting and reference value could serve as mechanisms for supplier engagement, our findings show how these ideas materialize in practice. For instance, simplify entry and foster connections mitigate supplier risk perceptions and encourage sustained supplier engagement, reinforcing the notion that public procurement need not be purely transactional but can incorporate relational elements to build long-term supplier relationships.

Our analysis also extends research on relational governance in public procurement by showing how procedural clarity and due process – often seen as bureaucratic rigidity – can foster supplier trust. Prior studies highlight due process as a safeguard against opportunism and favoritism (Kelly et al., 2021; Lonsdale et al., 2016), but our findings refine this view by showing how public buyers actively shape procedural structures to enhance supplier engagement. Specifically, reinforce engagements and simplify entry illustrate how buyers establish a “predictable-yet-participatory” environment through modularized tenders, systematic performance metrics and collaborative postaward engagements. This balance between standardization and differentiation ensures impartiality while allowing tailored engagement that enhances attractiveness.

Finally, this study challenges transactional or compliance-focused accounts of public procurement (Issah and Dadzie, 2024; Uenk and Telgen, 2019) by demonstrating that legal mandates need not diminish the relational dimension. Our evidence underscores how standardized procedures coexist with activities like debriefings, postaward feedback and selective incentives (reinforce engagements) that foster deeper, longer-term supplier commitment. This hybrid approach challenges the view that public buyers must trade away collaboration to uphold transparency. Instead, it highlights an emergent model where institutional legitimacy and relational governance reinforce each other, helping buyers become credible and appealing customers in a market often skeptical of bureaucratic constraints.

The findings of this study underscore the need for public procurement entities to undergo an organizational transformation. To enhance their attractiveness to suppliers, public buyers must cultivate an organizational culture that prioritizes understanding market needs and individual actors, supports continuous learning and innovation and moves beyond traditional bureaucratic routines. Redefining the engagement process is crucial. The procurement process should extend beyond its typical bureaucratic and routinized nature by actively engaging potential suppliers before tendering. This proactive approach can lead to a deeper understanding of supplier needs and foster stronger postaward relationships. Additionally, it is essential to strike a balance between comprehensive and accessible communication in procurement documentation and other interactions. Such an approach can make the procurement process more supplier-friendly and reduce misconceptions, thereby enhancing overall supplier satisfaction.

Despite certain regulatory rigidities, the study suggests that there is scope for flexibility within regulatory frameworks. For instance, modularized or innovatively packaged tenders can cater to diverse suppliers without breaching regulatory boundaries, thus making the process more inclusive. Addressing the public sector’s perceived unattractiveness is also vital. Strategies such as providing supplier training, emphasizing social connections and highlighting the intrinsic benefits of the public sector can help reshape its image, making it more appealing to suppliers.

Building and maintaining robust supplier relationships in the post-tender phase is crucial. Once a contract is awarded, the supplier’s leverage can increase, as switching providers mid-contract can be both difficult and costly for public buyers. This dynamic further underscores the importance of continuing to build trust and ensuring mutual growth even after the contract is signed. Regular feedback mechanisms and goal-oriented strategies with sound incentive structures can solidify these relationships and encourage suppliers to participate in future tenders. Moreover, ethical considerations in tactical circumvention must be carefully managed. While such tactics can enhance supplier relationships when applied judiciously, the ethical and legal implications and potential risks, particularly regarding equity and predictability, must be carefully considered. Systematically identifying and discussing the dilemmas between organizational benefits and legal boundaries is a prudent strategy.

Finally, public entities should capitalize on their intrinsic advantages, such as market stability and the inherent stamp of approval that comes with being a trusted and regulated institution, particularly in relation to sustainability. Leveraging these benefits can serve as a unique “selling” (i.e. buying) proposition to attract suppliers.

An important limitation is that our study only examined the customer’s self-reported behaviors and outcomes. The inclusion of suppliers’ responses in future research could provide a more comprehensive understanding. Additionally, our study focused on respondents from mature organizations with resources dedicated to enhancing attractiveness. Exploring the conditions and tactics of smaller or less mature organizations, which may face different challenges, would be beneficial.

Future research could further explore specific activities identified in this study, such as the role of supplier education and strategies for strengthening partnerships during the relationship phase. Some suppliers establish strong relationships by formalizing activities through contractual agreements. Public customers are currently exploring various contracting options, which could merit additional attention from both managerial and economic perspectives, particularly concerning the implementation of rewards-based systems and the segmentation of tenders.

A final observation relevant to future research is how public organizations navigate in a highly bureaucratically controlled environment dominated by New Public Management (NPM) thinking. The four tactics identified in our study can be reframed as three emergent approaches: replicating private industry practices, compensating for public sector deficiencies and circumventing regulatory constraints. Public organizations strive to emulate successful private sector practices in areas unbound by stringent public regulations. For example, they avoid legal jargon, prioritize social interactions and provide continuous feedback to align their processes more closely with those of the private sector. This adaptation is crucial for mitigating the bureaucratic image of public entities, making them more attractive to suppliers.

Organizations use compensatory measures in areas where public sector constraints cannot be avoided. These include proactive outreach to new supplier markets, modularizing tenders to accommodate varying supplier capabilities and training sessions to help suppliers navigate the complexities of public procurement. These organizations enhance their appeal to a broader range of suppliers by addressing the disadvantages of public procurement.

In some instances, public customers adopt tactics that may skirt regulatory constraints to foster better supplier relationships. Activities such as sharing information with suppliers before tenders are published, selectively discussing future opportunities and rewarding suppliers based on past performance fall into this category. While these actions can improve relationships and attract more suppliers, they also introduce unpredictability and potential legal risks, necessitating a careful balance between strategic benefits and regulatory compliance.

Future research should investigate these three emergent approaches further. An investigation into how public organizations replicate private industry practices, compensate for public sector deficiencies and circumvent regulatory constraints can provide deeper insights into their effectiveness and potential risks. Additionally, investigating the broader implications of the NPM regime by drawing from literature in organizational theory and public policy could reveal how different actors interpret and adapt to these conditions, potentially offering innovative solutions to the challenges posed by high levels of external control.