Issue Date: 
Monday, January 5, 2015

5 Facts to remember when starting a business

Article by W van Rooyen

www.how2tender.com

5 January 2015

These days it is not uncommon for entrepreneurs to start a business solely for the purpose to respond to tenders or request for proposals. The fact is that in South Africa it has become a fulltime job to respond to tenders, especially if you want to do business with Organs of State or with large Private Sector entities.

It is not a pre-requisite for an entrepreneur to have a registered juristic entity but it surely will be more advantageous. Remember you can respond to a tender in your own name and if you do respond to a tender in your own name the same rules apply as for those of a registered entity.

There are basically five facts to remember when you start your own business. These five facts are even more important if you want to respond to tenders.

1. SARS

Always register with the South African Revenue Service (SARS). Firstly and most importantly you have to register for Income Tax. This is very important. You will need a Tax Clearance Certificate if you want to respond to tenders and without an Income Tax number you won`t be able to receive a Tax Clearance Certificate which in turn will keep you from responding to tenders.

You might be required to register for Value Added Tax (VAT) if your business` annual turnover exceeds R1.2 million.

You also might be required to register for Pay as You Earn (PAYE) and Unemployment Insurance Fund (UIF) if your business has any employees.

2. Bank account

Unfortunately the days of keeping your money in box under your bed are long gone. You will need to open a bank account for your business. To open a bank account you will need proof of address (point 3) and proof of identity or proof of your business registration details. Remember to take these documents along when opening a bank account.

3. Registered address

You will have to have a registered address for your business. Tender Evaluation Committees tend to do site visits and it will be difficult to explain to them that you are doing business from your motorcar. The best is to set up a shop to show your intend of doing business. You will also need proof of address to open a bank account (see point 2).

4. Experience

Experience might be the most important fact of them all. If you do not have experience in what you`re doing failure is imminent. This is even more so when you respond to tenders - the Tender Evaluation Committees are vigilant when it comes to experience - so be sure to tender for something that you have experience in.

5. Resources

Resources You cannot start a business or respond to a tender if you do not have resources and by resources we mainly mean financial backing or money! Any start-up business that does not have sufficient financial resources is set to fail. Ensure that you have the necessary resources such financial support, infrastructure and human capacity.

Starting your own business is tough. Starting your own business especially to respond to tenders is even tougher. If you follow these five basic facts or rules you will have the necessary tools to start with an advantage over your competitors.

For more on this and other interesting tender news please visit our website at www.how2tender.com. You will also find our new revised Tender Manual 2015 there - our Tender Manual 2015 guides you through the whole process of responding to a Tender or a Request for Proposal.

Happy tendering.

Title Closing Date Tender No.
Supply of material and installation of Beta fencing at Thubelitsha Park in Kayamandi 2017-09-05 11:00 FQ/SM30/18
Supply: Filing kit, file, chain, guide bar 2017-08-23 12:00 W041800160
Appointment of a Suitably Qualified, Professional Conference Facilitator to Organise a Housing Summit in Conjunction with Directorate: Human Settlements and Property Management at Stellenbosch Municipality in September 2017 as per specifications 2017-08-31 11:00 FQ/SM 32/18
Supply and deliver ifm inductive sensors 2017-08-23 12:00 W041800163
Purpose of the proposed programme is to celebrate national youth day through a Mayoral Skills Development programme 2017-09-05 11:00 FQ/SM35/18
Mayoral Youth Skills Development: General building maintenance training 2017-09-05 11:00 FQ/SM37/18
Supply and delivery of 66 EPWP uniforms 2017-08-28 12:00 KZN294/00016-EPWP/2017/18
Training of TDA Staff in Coreldraw 2017-08-29 12:00 A071800124
Driver Training, Code C1 (10) & EC (14) in TDA 2017-08-29 12:00 A071800128
Supply: Taps 2017-08-28 15:00 R101800139
Basic Incident Command Training (Based on FEMA ICS) 2017-08-29 12:00 A071800127
Portable toilet hire & service 2017-08-24 14:00 A071800126
Provision of Legal Services 2017-09-01 12:00 SCM/2018/90/CORP
Supply and delivery of 40" tv with brack 2017-08-24 11:00 W061800095
Hiring of ambulances 2017-08-23 12:00 ZDMQ0201/08/2017
Supply and delivery of sound equipment 2017-08-29 11:00 W061800090
Accommodation for Msizi NQF 3 training around Ulundi 2017-08-23 12:00 ZDMQ: 0203/08/2017
Supply: Safety clothing 2017-08-25 10:00 R011800157
Accommodation for the Msizi Learnership Training around Ulundi 2017-08-23 12:00 ZDMQ: 0204/08/2017
Supply and delivery of telephones 2017-08-24 11:00 W061800103

Pages

Functionality and Tenders

In all competitive bids (tenders) you as the bidder will have to respond to Functionality. You will need to score a set minimum number of points, measured as a percentage, on Functionality of a competitive bid (tender) in order to advance to the next phase of evaluation in the tender process.

Usually Organs of State evaluate competitive bids (tenders) as follows:

  • The tender response is evaluated on Functionality where the bidder must score points out of a maximum of 100 points.
  • A threshold of between 65 to 75 out of 100 points... Read More
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