Over half of the 1,000 SMEs surveyed by freelance website Peopleperhour.com said that they intended to bid for contracts, one in four believed that bigger companies will win the "lion’s share" of the work.
Two thirds believed their lack of experience would prevent them from obtaining such work.
Three quarters said they feared public sector red tape should bids be successful.
PeoplePerHour.com founder Xenios Thrasyvoulou said: "Over the next 12 months we will see a revolution in the way government goes about its business. But as we make the move from Whitehall to High Street, the government has to ensure there’s a level playing field for small businesses."
