Issue Date: 
Monday, September 7, 2015

The 3 Principles of Tenders in South Africa

By Werner van Rooyen

7 September 2015

www.how2tender.com

Tenders in South Africa are based on three principles:

  1. Functionality
  2. Price
  3. B-BBEE

Functionality

All tenders, whether it is for the Public Sector or the Private Sector, will be evaluated on Functionality. Functionality is the most critical part of any tender response. If you get the Functionality part wrong during your response the chances are good that you will not advance to the following phase of the evaluation process – you will most probably fall out of the race.

When responding to tenders ensure that you understand exactly what is required in the Functionality part of the tender. Read the scope of the tender carefully and respond to direct questions as well as indirect questions. Functionality is the part where you advertise your company so make sure you do it properly.

Price

Most of the tenders that are awarded all around the world and for that matter in South Africa as well, Price will be the determining factor. At the end of the day, all that buyer’s want is to procure the best product at the best price.

In South Africa we even have a formula to determine which tender response is ranked where in the tender awarding process. The response or responses with the lowest price receive the most points and the more expensive tender responses receive fewer points. Ensure that your tender response scores the most points in the evaluation process.

B-BBEE

Last but not least, all tender responses will be evaluated on its B-BBEE levels. It does not matter if you respond to a Public Sector or Private Sector tender, your B-BBEE score will always be taken into account to determine the outcome of the tender award.

The Amended Codes of Good Practice that came into effect on 1 May 2015 is very stringent and obtaining a good or high B-BBEE score is going to take a lot of planning and hard work. Ensure that you have a good B-BBEE score to have any say in the outcome of a tender award.

How2Tender.com is hosting B-BBEE seminars to help you to get a better understanding of the Amended Codes and what it means to you and your business. You can also gain all the knowledge when it comes to tender responses by attending one of our “How-to-tender” workshops. Please visit our website for more details at www.how2tender.com.

Happy tendering  

Tenders, B-BBEE and the new Preferential Procurement Regulations 2017

We have previously asked: How important is a good B-BBEE status level of contributor in the tender process?

The answer is still the same: VERY IMPORTANT!

In all tender documents, you will find the NEW Standard Bidding Document 6.2 which is used to claim your Preference Points for B-BBEE. The higher your B-BBEE status level of contributor, the more points you will score on the Preference Points System. Ultimately the bidder or bidders scoring the highest points will be awarded the tender.

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