Issue Date: 
Monday, May 23, 2016

Functionality in Tenders Part 2 - 10 Tips

Tenders in South Africa are measured on three principles, namely Functionality, Price and Broad-Based Black Economic Empowerment (B-BBEE). An Enterprise's ability to execute a contract is measured through the Functionality Principal in the Tender Environment. If an Enterprise's tender response does not pass the Functionality test it can't be measured on Price and B-BBEE. Enterprises that respond to tenders must ensure that they will pass the Functionality test in order to advance.
But how do you ensure that your tender response will pass the Functionality test? Here are 10 tips on how to do that:

  1. You must realize that the Functionality test in a tender is nothing else but the section where you advertise your goods and / or services. Responding to tenders is a focussed marketing opportunity where you get to advertise your product/service to one specific buyer who is in desperate need of it. Ensure you make the most of it!
  2. You earn points during the Functionality test. Before you start responding to tenders go to the Functionality section. Scan the criteria to see if you will earn enough points to go through to the next round of evaluation. It doesn't make sense to waste time and money on a tender response if you are not going to pass the Functionality test.
  3. Ensure that you respond to a tender that is related to the business you are in. You will not be successful in bidding for something that you have no experience in.
  4. Use the exact phrasing or wording in your tender response that is used in the tender document. This makes it easier for the Evaluation Committee to find what they are looking for.
  5. Use the exact same format that the tender document uses in your response. If the Functionality in the tender document is in a table then try and use a table as well in your response.
  6. Your items under Functionality must be in the same order as that of the tender document. Don't swap items around. You want to make it as easy as possible for the Evaluation Committee to find what they are looking for.
  7. Don't over sell your business. This might seem strange but many Enterprises have a range of goods and / or services that they sell. Evaluation Committees are only interested in the goods and / or services that they want to procure. Giving them too much information might prevent them from finding the right information.
  8. Be visual! In today's world everything is about visual effects. We look at mobile screens, computer screens and big screen televisions. Even your car has a screen it these days! Ensure that your tender response, especially when it comes to Functionality, has some photos of your product as well as of your Enterprises' staff. If you use machinery in your business then showing it is always a good idea. Remember,  the photos that you put into your tender respond must add value to your tender response and obviously be relevant to the tender requirements.
  9. Be honest in your functionality response. Remember that a tender is binding and if you cannot execute the contract you might find yourself in legal battles if you have won the tender but you cannot deliver.
  10. Finally you must remember that your tender response is going be evaluated by a person like you and me.  It is also unlikely to be the only tender response to that specific tender. So make it easy for the people on the Evaluation Committee to find and score your Functionality items.

If you follow these tips and tricks you will have a better chance in be successful at bidding.

Educating yourself and get proper training in the art of responding to quotations by attending a training session such as the How-to-Tender workshop (www.how2tender.com).

Earn to learn!

When Must I Sub-Contract?

There seems to be a lot of confusion amongst entrepreneurs when it comes to tenders and sub-contracting. The Draft Preferential Procurement Regulations, have been gazetted and are currently up for review. However, these Regulations are the major cause for the confusion. Many entrepreneurs ask whether they should sub-contract or not whilst responding to a tender.

The Draft Preferential Procurement Regulations stipulates the following: 

  1. For contracts above R30 million, the tenderer MUST sub-contract a minimum of 30% of the value of the... Read More
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