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!

Visit our website www.how2tender.com. Learn to earn

Title Closing Date Tender No.
Provision of emergency medical service on 24 hours basis 7 days a week including Wilge properties personnel, Khutala Mine, Kusile and first aid training only for emergency care team members at Kendal Power Station for the period of 3 years. 2018-03-26 10:00 MPGXC005059
Appointment of an Environmental Consultant to execute an Environmetal Impact Assessment (EIA) Process for the Proposed Matlosana Agri-Hub, situated in the Remainder of Portion 1 of the Farm Townlands of Klerksdorp 424 IP in Matlosana Local Municipality under Dr Kenneth Kaunda District Municipality in the North West Province 2018-03-01 11:00 NW-TEN 02 (009) 17/18
Supply: Capacity Building- Ward 33 Seniors Event: Cooler bag and mugs 2018-02-26 12:00 GL11800575
Appointment of an environmental consultant to execute an Environmental Impact Assessment (EIA) process for the proposed Vryburg Agri-Hub, situated in Commonage ERF506 Camp G in Naledi Local Municipality under Dr Ruth Segomotsi Mompati District Municipality in the North West Province 2018-03-01 11:00 NW-TEN 02 (008) 17/18
Request for proposals for production of a documentary video on illegal, unregulated and unreported fishing in Africa 2018-03-23 15:00 AUC/IED/119
Appointment of a service provider to provide a registry service to the Events Department from date of commencement not exceeding 1 year. 2018-02-27 12:00 SL11800155
Request for expressions of interest (EOI): Medical Insurance Coverage for African Union contract staff and their dependents 2018-03-15 15:00 AUC/HRM/NC/1
Supply Central 3 Career Expo Promotional Item – Drawstring bag 2018-02-27 12:00 GL11800577
Appointment of service providers to form a bodyshop of service providers to assist the Department of Rural Development and Land Reform with Complex Forensic Investigations for a period of two years 2018-03-01 11:00 5/2/2/1 – RDLR 0144(2017/2018)
Supply Two seater couch And one seater couch 2018-02-26 12:00 GL11800578
Appointment of a service provider to supply and deliver a refrigerated delivery truck for Witzenberg Agri Park Logistics Project in the Cape Winelands District Municipality in the Western Cape Province 2018-03-01 11:00 SSC WC 12 (2017/2018) DRDLR
Supply: Drawer bulk filer 2018-02-27 12:00 GL11800579
Purchasing of books for City Health Medical Stores 2018-02-28 11:00 GM11800624
Appointment of a Service Provider to Procure Through Normal Supply Chain Processes an Office Container for Witzenberg Agri Park Logistics Project in the Cape Winelands District Municipality, Western Cape Province 2018-03-03 11:00 SSC WC 16 (2017/2018) DRDLR
Leasing of the remaining extent of portion of the farm Kameelbult 604 IO and portion 9 of the farm Doornbult 603 IO, measuring 638, 7546 hectares in extent, made up of 354 hectares of dry land, 16 hectares irrigation and 266, 7546 hectares of grazing land, for a period of thirty (30) years 2018-03-06 11:00 NWPSSC 01 (091) 2017/18
MBDA hereby wishes to invite suitably, qualified and experienced service providers to provide Developmental Consulting Services to the Agency. 2018-02-26 11:00 BDA0218520
MBDA seeks quotes from accredited service providers to supply and deliver: 5 x i5 Notebooks and Accessories 2018-02-26 11:00 BDA0218519
Supply and Delivery of 40 Rolls, 30 M Each, 4 Mm Galv. Mild Steel Stay Wire - 5 Strand (Plse Note: Not 7 Strand) 2018-02-28 11:00 SQ02181171
Supply & Delivery of 70mm X 3c 11kv Fibre Glass Straight Joint Boxes with all Accessories 2018-02-28 11:00 SQ02181171
Supply and Delivery of Bituminous Compound for Cable Joints, Black In 12,7 Kg Containers. Compound 15426/127. 2018-02-28 11:00 SQ02181171

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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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