Issue Date: 
Thursday, October 31, 2019

Reasons why Joint Ventures fail

By Werner van Rooyen, Director of HowToTender (Pty) Ltd which specializes in tender consulting and tender training.

There are many reasons why Joint Ventures fail and five of the most common reasons are:

  1. Lack of a proper Joint Venture Agreement.  The importance of a proper JV Agreement cannot be emphasized enough.  Ensure that you have a proper contract in place that covers the entire foundation of your JV.
  2. Lack of finance.  If one of the parties to the Joint Venture is struggling financially it can be the downfall.  The simple reason is that the struggling partner will drain the Joint Venture, not allowing the it to build up capital for challenging times or future expansions.
  3. Control issues.  In any relationship you will always find that someone needs to be the leader or the decision maker.  A Joint Venture is the same – somebody needs to be in control.  Ensure that the correct leadership is appointed.
  4. Compatibility.  Sometimes in the rush of securing a tender a business owner will go into a Joint Venture with another business owner who does not have the same values and ethics.  This is a dangerous mistake.  Remember that you have established a certain way of doing business and that you have invested a lot in building the ethics in your business.  Ensure that the Joint Venture partner that you sign up with is compatible with your policies of running a business.
  5. Unrealistic expectations.  Ensure that all role players are on the same page when it comes to the Joint Venture’s successes.  There must be clear indicators on the chances of winning a tender as well as the expected profits to be made after the awarding of a tender and the completion of the tender.  All the parties involved must be briefed on the expected profits so that there are no unrealistic expectations from any of the parties involved.

If you tend to these five critical areas in your Joint Venture the chance for it to succeed will increase immensely.

To learn more about this and many other tender conditions attend our “Become a Tender Expert” 2-Day workshops presented in Johannesburg, Pretoria, Durban, Port Elizabeth, and Cape Town.  Book and pay online at https://howtotender.co.za/tender-expert-form/

Contact us at wernervr@howtotender.co.za should you require more information.

You can also purchase a Tender Manual (Handbook) on our website https://howtotender.co.za/ which is a step by step guide how to respond to a South African Tender.  It includes examples of completed SBD forms.

Title Closing Date Tender No.
Design, supply, erect, inspect and dismantle of scaffolding at Thornwood Embankment rehabilitation 2020-07-23 10:00 CRAC-DNR-33228
For the hire of a crewed 41.5 x 10m barge and a tug boat with a 10ton bollard pull capacity at seawall, berth 9 pier 1, Durban harbour 2020-07-21 10:00 CRAC DNR 32500
Printing services - AU diary and calendar 2021 - Framework Contract 2020-08-06 15:00 AUC/DIC/G/005
Supply and delivery of 18 x (xqty) hydroulic lifting trolleys for Forensic Pathology Services for 14 hospitals 2020-08-05 12:00 HEAL/208/20/MP Re-advertisement
Supply and delivery of 8 x dialysis machines with RO plant for Rob Ferreira and Witbank Hospital 2020-08-05 12:00 HEAL/209/20/MP Re-advertisement
Provision of Ambulance Services and Outsourcing ERT Services at Matla Power Station for a period of five (5) years. 2020-09-03 10:00 MPGXC006225
Occupational health and safety consultant for a period of three (3) years 2020-07-16 16:00 RFQ/002/2020
Invitation to tender for Farm Rietfontein Portion 47 395 JR 2020-07-28 10:00 IRP265
OHS Agent_Upgrade of Hornlee Sewer_T06 of 2019/2020 2020-07-14 12:00 12/2020/21
OHS Agent_Hornlee_Replacement & Rehabilitation of Existing Water Network_T21 of 2019/2020 2020-07-14 12:00 13/2020/21
Supply and delivery of hand sanitizer, gloves and masks 2020-07-14 12:00 14/2020/2021
Supply and Delivery of Laptops 2020-07-16 12:00 15/2020/21
Provision of loan finance 2020-08-05 12:00 T 01 OF 2020/21
Appointment of a suitable qualified and experienced service provider as auctioneer for a period of three (3) years to conduct the auctions of municipal owned fixed assets, moveable property and impounded vehicles on behalf of the municipality 2020-08-05 12:00 T 02 of 2020/21
Erratum: Extension of validity period for additional: 120 days for electrical database and mechanical database 2020-07-10 11:00 ZNB 5731/ 2019- H/ ZNB 5730/ 2019- H
Erratum: Provide a fully managed enterprise picture archiving and communications system for the Gauteng Department of Health (GDOH) with maintenance and support for a five (5) year period 2020-07-24 11:00 RFB 2186/ 2020
Erratum: Supply & install a hosted internet protocol telephone system & IP phones for the Dep of Higher Education & Training 2020-07-17 11:00 RFB 2158/ 2020
Erratum: Request for Proposals: Appointment of a panel of suitable service providers to supply and deliver office stationery to the NHBRC for a period of three (03) years. 2020-07-10 11:00 NHBRC 41/ 2019
Erratum: Supply maintenance of network cabling for saps for a period of three (03) years 2020-07-24 11:00 RFB 2126 - 2019
Request for Proposal: Establishment of a frame agreement for provision of translation and interpretation services for UNHCR offices in regional bureau of Southern Africa. 2020-08-07 16:00 RFP/020/HCR/RBSA/SUP/019

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