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, doesn't matter 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 done on your current supplier database whereas Enterprise Development is done 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! 

If you want to learn more about this and what the rest of the Amended Codes entails you can visit our website www.how2tender.com or contact us.
 

Title Closing Date Tender No.
Land and building - Old Shipyard 2018-10-12 12:00 ELS/HPM 3/17/09/2018/3A
Supply & printing of no access notebooks Water & Sanitation Department. 2018-09-28 12:00 SK1190034A
Network Partner 2018-09-28 16:00 No Reference
Provision of a Talent Management Solution 2018-10-08 12:00 RFP GvdW-4601170/2018
Supply Tools and equipment 2018-09-21 12:00 GD11900341
Catering for Tourism Workshop. 2018-10-21 10:00 SD11900230
Appointment of a service provider to render internal audit services to Robben Island Museum for a period of three (3) years 2018-10-12 11:00 RIM EXE 01-2018 /2019
Design and develop a renewable energy hybrid mini-grid that is sustainable 2018-09-21 12:00 #91119897
Appointment of a Principal Agent to provide Civil and Structural services for the proposed Telecommunication site at Colesberg in the Northern Cape. 2018-10-23 12:00 SENT/030/2018-19
EMC Infrastructure Upgrade. 2018-10-09 13:00 RFP-18/19/28/EMC Infrastructure Update
For ¾ Pillow Top Bed Including Base for NHLS Delmas Laboratory, Mpumalanga. 2018-09-26 08:30 1420581
IBM Infrastructure Upgrade/AVW. 2018-10-09 11:00 RFP-18/19/29/IBM Infrastructure Upgrade/AVW
Biosafety Cabinet 2018-09-21 11:00 RFQ 1446901
1 x Upright Light Microscope 2018-09-25 11:00 1667839
Request for the Installation of access Control to the NICD Cottage Gates 2018-10-01 11:00 0911059/18-19
HP Infrastructure Upgrade. 2018-10-09 11:00 RFP-18/19/30/HP Infrastructure Upgrade/AVW
Microscope 2018-09-21 11:00 RFQ 1469472
Provision of Design, Supply, Install, Test And Commission Of Roof At Limpopo Lumber Politsi. 2018-10-09 12:00 TPIR/TZA/680 (Q) CIDB
For 4x Wooden Oak Filing Cabinets For Evander Laboratory 2018-09-26 10:00 RFQ 1420571
Provision of professional services for the implementation and management of the rural road asset management system in the Frances Baard District for a period of three (3) years. 2018-10-09 12:00 BID 14/18

Pages

Advantages and disadvantages of Consortiums

Consortiums are often considered as entities to use when responding to tenders in South Africa. The question that arises is whether to use a Consortium or a Joint Venture when responding to a tender. To help you with this we have compiled a list of advantages and disadvantages for both Consortiums as well as Joint Ventures. In this article we list the advantages and disadvantages of Consortiums. Look out for the same article on Joint Ventures.

Consortiums Advantages:

  • Easy to establish as there are no formal procedures... Read More
Free Keyword search

Search all tender notices for FREE!

No subscription or registration required!

You can also search by the reference of the the tender.

Advanced search

Search by Issuer, Region or Sector, individually, or using any combination of the three.