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

Learn to earn

Title Closing Date Tender No.
Cleaning of reservoirs and towers. 2018-03-27 10:30 JW OPS 015/17
Appointment of a Travel Agent for the period of 3 years 2018-03-27 11:00 MHSC015/2017-18
Supply & Delivery of Borehole Maintainance Spares to Mopani District Municipality for 36mothns Multi-framework contract. 2018-03-27 12:00 MDM 2017-055/1
Requests for proposals are hereby invited from relevant services providers for the lease of Desktops and Laptops for a period of 36 months 2018-03-29 12:00 UGU-05-1466-2018
Repairs to roads including pothole patching using environmentally friendly technology within the Msunduzi Municipality’s area of Jurisdiction. 2018-03-27 12:00 SUPPLY AND SERVICES CONTRACT No. 80 OF 2018
Appointment of a Panel of a Maximum Ten (10) Service Providers for the Supply and Delivery of Additional Emergency Relief Stock for a period of 36 months 2018-03-29 12:00 UGU-05-1467-2018
Appointment of Three (3) Service Providers for Supply and Delivery of Free Basic Alternative Energy for Polokwane Municipality for a Period of Two (2) Years (Re-Advert). 2018-03-27 10:00 291/2016
Supply and Delivery of water purification chemicals to Mopani District Municipality for 36Months Multi-Framework Contract. 2018-03-27 11:00 MDM 2017-054
Appointment of service provider to provide courier services for a period of 3 years (Re-Advert) 2018-03-28 10:00 222/2016
Appointment of accredited service providers to service, repair and replacement of the following fire equipment, fire extinguishers, fire hoses reels, fire hydrants, fire hydrant boosters, symbolic signs of the municipality for the period of three (3) year. 2018-03-28 10:00 PM92/2017
Supply and delivery of Sanitary Hygiene Services for the period 01 July 2018 to 30 June 2021 2018-03-23 12:00 WDM 03/2018
Request For Information (RFI) for the Automation Identification Data Capture. 2018-03-29 10:00 CORP 4359
Supply delivery and installation of Outdoor Gym Equipment for a contract period of 24 months 2018-03-29 12:00 BSM 69/18
Supply and delivery of Artificial Grass for a contract period of 24 months. 2018-03-29 12:00 BSM 70/18
Construction of Idas Valley Merriman outfall sewer and associated works. 2018-03-29 12:00 BSM 65/18
Supply and delivery of chemicals for use in the purification of water. 2018-03-29 12:00 TENDER 72-17/18
Refuse removal in Brandwag and Ruiterbos. 2018-03-29 12:00 TENDER 73-17/18
Statutory inspection and testing of lifting equipment 2018-04-03 10:00 246S/2017/18
Invitation to service providers: Appointment for facilities management and cleaning services in the Bojanala, Dr Kenneth Kaunda and Ngaka Modiri Molema Areas. 2018-04-11 11:00 NWDC/BOJANG/2018
Request for information - Precinct development 2018-04-10 11:00 RFI-001-2017/2018


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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