Issue Date: 
Tuesday, September 20, 2016

10 Principles When Pricing Your Tender

We are often asked how to work out a tender price? But there is no straight answer because every tender is different. The fact is that a tender for the supply of furniture will have a different pricing structure to that of the supply of food for a government function. So to provide individual pricing techniques would be very difficult.

In general, there are ten points that must be considered when calculating price. These are:

  • Price is king – ensure that you price your product or service as low as possible in order to stand a chance of winning a tender.
  • Be precise; when the product supplied is R101-26 then state it in the tender response as R101-26 and not as R101-00 or even R102-00. Small differences like these can result in large amounts that can be lost, depending on the size of the tender.
  • Ensure that all the costs of delivering the product is taken into consideration; double check your pricing – omitting something small can come back and bite you later on.
  • Confirm prices of goods with your suppliers – prices can change very quickly due to increases in fuel prices or exchange rate fluctuations.
  • Always remember to add Value Added Tax (VAT) at 14% to your price especially when it relates to Government tenders. Most tenders state that the price must include VAT.
  • Ensure that all other applicable taxes are included in the tender price.
  • The most important piece of advice on Pricing: never bid too low or too high;
    • Bid Evaluation Committees are well informed and they will know if a bid is too low or too high;
    • Bidding too low or too high might lead to a tender response being disqualified or marked as non-responsive;
  • Pricing can be influenced by law as well – there are several industries in South Africa, such as the cleaning industry, which has minimum wages payable to employees;
  • A suggestion is that if your usual mark-up is 25% then tender perhaps at 18% to 20%. Remember that you are going to save on direct costs as well as on other expenses such as advertising, telephone costs and much more. Use these savings to lower your price.
  • Remember that in Government tenders you are going to be scored on your price and currently price counts for 80 out of 100 points for tenders less than R1 million and 90 out of 100 points for tenders with a value of more than R1 million. The bidder with the lowest price receives the most points.

To learn more about this and many other tender conditions please attend one of our How-to-Tender workshops. Tender Workshop dates are published on our website at www.how2tender.com.

Learn to earn

Title Closing Date Tender No.
Appointment of a service provider for provision of Management Information System (MIS) services and related services to the Chemical Industries Education and Training Authority for a period of Twenty-Four (24) months on the 80/20 PPPFA, as amended 2018-06-15 11:00 CHIETA- MIS- 02- 2018/ 19
Cleaning of Gardens and Grounds at KwaZulu Central Provincial Laundry for (6) Six Months 2018-06-08 11:00 ZNQ 056/ 2018- 16K
Supply and deliver and install bulk vaccine fridge minus 40. Suppliers must be appointed as service, repairs, commissioning and sales agents to all minus 40 Refrigeration and equipment. Letter must attached. 2018-06-01 11:00 ZNQ 545/ 2017
Upington Statistics South Africa: Alternative office accommodation: 454.55m² and 15 parking bays for a period of 5 years 2018-06-27 11:00 LS02/ 2018
Canteen Services 2018-06-22 11:00 RFB 005 2018 2019
Kuruman Public Protector: Alternative office accommodation: 215.91m² and 6 parking bays for a period of 5 years 2018-06-27 11:00 LS03/ 2018
Major service to medical waste container. 2018-06-01 11:00 ZNQ 112/ 2018
Request for Proposal to Render Cleaning Services to The Northern Cape Provincial Treasury For the Period of 36 (thirty six) months 2018-06-15 11:00 BID NO: NCPT/ 02/ 2018
Appointment of a legal firm of conveyancer to do the transfer of immovable properties from Nkandla, Big Five Hlabisa and Endumeni Local Municipalities to KZN provincial government. 2018-06-22 11:00 ZNT16/ 17/ 18
Major service to air particle count theatre –companies must be registered on CIBD (2ME) 2018-06-01 11:00 ZNQ 116/ 2018
Request for Proposal to Render Cleaning Services to The Northern Cape Provincial Treasury For the Period of 36 (thirty six) months 2018-06-15 11:00 BID NO: NCPT/ 02/ 2018
Supply and Deliver two (02) x Spreader: Chips self propelled: 4x4 2018-06-28 11:00 R/ M 61/ 2018
Request for Proposal for The Provision of Security Services to the Northern Cape Provincial Treasury For the period of 36 (thirty six) months 2018-06-15 11:00 BID NO: NCPT/ 03/ 2018
20 rolls x casement cloth 50m x 158cm width. (see description for colours and quantities) 2018-06-06 11:00 ZNQ 105/ 18
Annual service of Theatre Lights. 2018-06-08 11:00 H94/ 18/ 19
150 units - straight fitting Connex - 54mm 2018-06-06 11:00 61/ 18
Servicing of Infrared testing on electrical installation in 6 Clinics 2018-06-08 11:00 C22/ 18/ 19
Annual service of Theatre UPS. 2018-06-08 11:00 H93/ 18/ 19
Dental laboratory service for Orthodontic 2018-06-04 11:00 ZNQ 195 of 18/ 19
Annual service of Earth monitoring equipment around the institution 2018-06-08 11:00 H103/ 18/ 19

Pages

Tender adjudication process

The SBD/WCBD6.1 document must form part of all bids invited.  It contains general information and serves as a claim form for preference points for Broad -Based Black Economic Empowerment (B -BBEE) Status Level of Contribution, and explains how tenders or bids are decided.

The document says:

  • The bidder obtaining the highest number of points will be awarded the contract.
  • Preference points shall be calculated after prices have been brought to a comparative basis.
  • Points scored will be rounded off to two decimal places... Read More
Free Keyword search

Search all tender notices for FREE!

No subscription or registration required!

You can also search by the reference of the the tender.

Advanced search

Search by Issuer, Region or Sector, individually, or using any combination of the three.