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.
Major service to diesel storage tank (1400lt) supply 5000lt -companies must be registered on CIBD. 2018-06-01 11:00 ZNQ 111/ 2018
The Construction of 2.000kms of Local Gravel Road L3212 Between Chainage 0.000 Km to 2.000 in Ndwedwe Local Municipality 2018-06-28 11:00 ZNT373T/ 3/ C2930/ 188/ S/ 1/ 2018- 2019
Repairs and Refurbishments of West End Community Health Center at Nelson Mandela Metro - PE 2018-06-29 11:00 SCMU3- 17/ 18- 0361- HO
Major service to storm water drains -Company must be registered on CIBD. 2018-06-01 11:00 ZNQ 113/ 2018
Bidders are hereby invited to provide office accommodation for the FAIS Ombud in Pretoria East and Centurion, Gauteng, South Africa for a period of 3 years with the option to exit after 2 years 2018-06-26 11:00 RFP 30/ 2018
Major service to medical vacuum pumps -companies must be registered on CIBD (2ME. 2018-06-01 11:00 ZNQ 115/ 2018
Bidders are hereby invited to provide office accommodation for the FAIS Ombud in Pretoria East and Centurion, Gauteng, South Africa for a period of 3 years with the option to exit after 2 years. 2018-06-25 11:00 FAIS 2018/ 19- 02
Major Service to medical gas banks (oxygen, medical air, nitros) -companies must be registered on CIBD (2ME) 2018-06-01 11:00 ZNQ 114/ 2018
Drilling of borehole at Ezimpondweni Clinic 2018-06-01 11:00 ZNQ 63/ 18/ 19- C
The Appointment of a service provider to provide business continuity solution to Companies Tribunal for a period of two (2) years 2018-06-15 11:00 CT/ 001 (18/ 19)
Supply and install wall mounted industrial fans 65 cm x 20 2018-06-08 11:00 ZNQ 049/ 2018- 19K
Provision of General Building and Grounds Maintenance Services-Kwazulu-Natal 2018-06-15 11:00 SAMRC/ FMPGB& GMS/ 2018/ 02
Consulting services to conduct an Environmental Impact Assessment (EIA) for fuel station with truck staging area within the COEGA Special Economic Zone (CSEZ). 2018-06-18 12:00 CDC/ 236 / 18
Provision of General Building and Grounds Maintenance Services-Gauteng 2018-06-15 11:00 SAMRC/ FMPGB& GMS/ 2018/ 03
Supply and deliver 05x Lexmark ink cartridge X654X31E. 2018-06-01 11:00 ZNQ 66/ 18/ 19- H
Supply: Book manuscript size A4 2 quire = (qty) 100 units. 2. Book manuscript size A4 4 quire = (qty) 50 units. 3. Pens medium ball black = (qty) 300 units. 4. Stapler desk type = (qty) 50 units. 5. Staples for hem 012601 = (qty) 100 units. Specifications attached to the document 2018-06-01 11:00 ZNQ 21/ 18- 19
Provision of Office Accommodation:Free State North WestProvOffice for a period of 5 years. 2018-06-29 11:00 13/ 2018
Supply: 1. Paper photocopying white bond 80 gsm a3 - (qty) 30 boxes 2. Paper photocopying white bond 80g a4 - (qty) 120 boxes specifications attached to the document. 2018-06-01 11:00 ZNQ 24/ 18- 19
Alterations & Refurbishment of Legal Aid SA Benoni Office 2018-06-29 11:00 17/ 2018
Supply 1. Clear garbage bags 40 micron 910mm x 760mm= (qty) 100 pkt (100 pcs per packet) 2. Red garbage bags 40 micron 910mm x 760mm= (qty) 100 pkt (100 pcs per packet) 3. Red garbage bags 40 micron 350mm x 300mm= (qty) 100 pkt (100 pcs per packet). 2018-06-01 11:00 ZNQ 35/ 17- 18, 18/ 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
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