Issue Date: 
Wednesday, December 2, 2015

The difference between Supplier and Enterprise Development

The Amended B-BBEE Codes of Good Practice came into effect on 1 May 2015. This means that any business that has a turnover of more than R10 million per annum and that participates in B-BBEE will have to comply with these Amended Codes. Although B-BBEE is absolutely voluntary, it is going to become difficult to avoid if your business is main stream, irrespective of what your turnover is.

One of the easiest ways to earn points is through the Enterprise and Supplier Development Element. This Element counts for 40 points on the Generic Scorecard and for 30 points on the Qualifying Small Enterprise (QSE) Scorecard. The reason it is easy to score points is because there are three sub-elements and you can score points on each one of them. The three sub-elements are:

  • Preferential Procurement;
  • Supplier Development and
  • Enterprise Development.

Preferential Procurement will dictate who your suppliers are going to be in future - new stringent requirements around Preferential Procurement will force businesses to broaden their supplier database. Supplier Development will become very important because businesses are going to struggle with their Preferential Procurement and therefor they will need to develop Suppliers to fulfil their supply chain needs. Enterprise Development will become increasingly critical to feed the Supplier Development as well as the Preferential Procurement supply chain. 

But what is the difference between Supplier Development and Enterprise Development? Supplier Development is performed on your current supplier database whereas Enterprise Development is on suppliers that are not on your database as well as on start-up businesses or new entrants. With Supplier Development the business is already a supplier to your business as where with Enterprise Development the business wants to become part of your supply chain.

Remember that when you do either Supplier or Enterprise Development there are certain rules and regulations that need to be followed:

  • Supplier and Enterprise Development can only be done for 51% or more Black Owned Businesses;
  • These 51% or more Black Owned Businesses must have a turnover of less than R50 million per annum;
  • You cannot claim money spend on Supplier Development as money spend on Enterprise Development;
  • Supplier and Enterprise Development can only be done on existing businesses;
  • The spend on these two sub-elements must be quantifiable in a monetary value;
  • There must be a formal written agreement between your business and the recipient of Supplier or Enterprise Development;
  • The recipient must show its gratitude by means of a Letter of Appreciation.

Last but not least - you must remember that in order for your business to score full points for Supplier and Enterprise Development you will have to spend money on these two development criteria:

  • For Supplier Development you will have to spend 2% (1% QSE) of your nett profit after tax per annum and
  • For Enterprise Development you will have to spend 1% (1% QSE) of your nett profit after tax.

Our advice is to start planning now!

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Title Closing Date Tender No.
Supply: 30 units sets cysto irrigation 2017-10-03 11:00 ZNQ 771/ 17/ 18
Servicing of mini substations as per specification 2017-10-09 11:00 ZNQ 714/ 17- 18
Supply: 120 pairs stockings anti embolism thigh high small 2017-10-03 11:00 ZNQ 774/ 17/ 18
Service to fire fighting equipment at Ndwedwe CHC, Wosiyane clinic, Thafamasi Clinic and Mwolokohlo Clinic 2017-10-10 11:00 ZNQ137/ 17/ 18
Supply: 210 Units sets administration high capacity 2017-10-03 11:00 ZNQ 770/ 17/ 18
Minor repairs and refurbishment of JF Mati senior secondary school in Mdantsane NU 9, East London. 2017-10-16 12:00 CDC/ 321/ 17
Supply: 200 units sets infusion y type 2017-10-03 11:00 ZNQ 769/ 17/ 18
Supply: 115 Units catheter urethral foley 2 way latex 3ml 8fg 2017-10-03 11:00 ZNQ 731/ 17/ 18
Industrial stove (3 plate with oven) 2017-10-03 11:00 ZNQ NO.2511/ 08/ 17
CapeNature seeks the services of a skilled project management team and contractor to construct a recreational area including a swimming pool and shaded lapa at the Grootvadersbosch Nature Reserve. The contractor must have a minimum level 3GB for the installation of the required pool and recreational area. 2017-10-20 11:00 WCNCB 01/ 09/ 2017
Supply: 372 boxes test kit syphilis IPR 2017-10-03 11:00 ZNQ 845/ 17/ 18
Steel staff lockers (as per spec) 2017-10-03 11:00 ZNQ NO.2510/ 08/ 17
Supply: 40 Units hospital standard bed with mattresses 2017-10-03 11:00 ZNQ 846/ 17/ 18
Request for information (RFI) for the supply and installation of digital voice recording system at all control centres at EMS: 3 year contract 2017-10-16 11:00 ZNB 5135/ 2017- H
Supply: 108 pairs stockings anti embolism thigh high medium 2017-10-03 11:00 ZNQ 775/ 17/ 18
Supply: 150 pairs stockings anti embolism thigh high x large 2017-10-03 11:00 ZNQ 776/ 17/ 18
Supply: 6360 units nebulizer aerosol child 2017-10-03 11:00 ZNQ 835/ 17/ 18
Supply: 1100 pkts electrodes E.C.G adult pkt/50 2017-10-03 11:00 ZNQ 834/ 17/ 18
Supply and deliver 10L Buckets plastic. Green, Yellow, Blue, Red and White Colours. QTY: 32 Units 2017-10-06 11:00 ZNQ: 593/ 17- 18
Supply and deliver SHE Bins 10L. QTY: 48 Units 2017-10-06 11:00 ZNQ: 591/ 17- 18

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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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