Issue Date: 
Wednesday, October 14, 2020

When to choose a Joint Venture, Consortium or Sub-contracting

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

Many people ask us: how do you decide between using a Joint Venture, a Consortium or Sub-contractor in responding to a tender?

In choosing which business type to use (Joint Venture, Consortium or Sub-contracting) in responding to a bid depends on how many partners (if any) is needed to comply with the specific bid specifications.

The best option is to respond to a bid on your own. This is not always possible. There are many reasons, i.e. Sub-contracting criteria (30% Regulations), minimum B-BBEE levels, minimum Financial requirements, and the most common reason – Purchasing Authorities that combine goods and/or services that they think is one supply or product. Some bids specify that only Consortia may respond due to the complexity of the contract. All these factors will play a role in deciding which business type/tender vehicle bidders will use in responding to a specific bid.

Joint Ventures and Consortia are partnerships that is established to execute a tender. Both type of partnerships has their advantages and dis-advantages. You can find our articles describing the advantages and dis-advantages of both these business types here: https://howtotender.co.za/hints-and-tips/

The next question is: how many partners in Joint Venture or consortium? The general guideline is that Joint Ventures do not have more than 3 partners. Any number of partners above three will be better suited by forming a Consortium.

Sub-contracting is always a better option in complying with bid specifications than restricting yourself to one or more Joint Venture/Consortium partner/s. With sub-contracting the main contractor stays in control of the contract execution. It is easier to replace a sub-contractor than getting rid of a partner.

In some cases, bidders will find it necessary to establish a Joint Venture/Consortium and sub-contract a portion of the contract.

The answer to the question: When to choose a Joint Venture, Consortium or Sub-contracting will thus depend on all these factors mentioned above. Read the bid specifications carefully and make an informed decision in choosing partners and/or sub-contractors.

To learn more about this and many other tender conditions attend our “Become a Tender Expert” 2-Day workshops/webinars 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  estelle@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.
Request for Proposals: Production of Functional Requirements and Development of a Minimum Viable Product for the PSET CLOUD. 2021-05-16 17:00 No reference number
RFQ for Quotations (RFQ) to appoint a service provider/supplier to review the Corporate Governance Framework of SACNASP and to develop a Delegation Framework and to align SACNASP’s Corporate Governance with Enterprise Risk Management. 2021-04-21 11:00 No reference number
The provision of internal audit services for the KZN Growth Fund Trust for the period of thirty-six (36) months. 2021-05-04 12:00 KGFT - RFP 2021/02
Consultancy services to establish the Africa CDC Regional Integrated Surveillance and Laboratory Network (RISLNET) in Southern Africa 2021-05-04 15:00 ET-AUC-225259-CS-QCBS
Appointment of a service provider for provision of short-term insurance for three (3) years for council for medical schemes 2021-05-10 11:00 CMS022021/22
Appointment of a service provider for provision of human resource service (job evaluation and salary benchmarking) for three (3) months 2021-05-10 11:00 CMS01/2021/22
Appointment of a travel management company (TMC) for three (3) years for the Council for Medical Schemes (CMS) 2021-05-10 11:00 CMS03/2021/22
Supply, installation and management of a prepayment electricity vending system 2021-05-14 12:00 SCM/20218/204/FIN
Supply and Delivery of Personal Protective Clothing for a period of 3 years. 2021-05-14 14:00 SCM 13/2021
ICT Support Services and Licensing for a period of 3 years. 2021-05-14 12:00 SCM9/2020/21
Appointment of electrical contractor for supply, delivery and installation of high mast lighting for a three -year period as and when required in the eastern region 2021-05-20 11:00 BID NO: 292/2021
Appointment of electrical contractors for supply, delivery and installation of high mast lighting for a three -year period as and when required in the southern region 2021-05-20 11:00 Bid No: 293/2021
Three year contract for road resealing & repairs for the City of Mbombela 2021-05-21 11:00 BID NO: 243/2020
Enlistment of training providers in the panel of accredited training service providers for the implementation of training projects funded by the department through the environmental protection and infrastructure programme (epip) on “as and when required basis” over a period of three (3) years. 2021-04-30 11:00 DFFE -T001 (21/22)
Supply and delivery of cast iron saddles 2021-04-19 12:00 RFQ319/2020/21
Supply and fit broken flywheel housing and repair engine block on Nissan UD70 Truck. 2021-04-19 12:00 RFQ317/20/2021
Supply and delivery of tared Pinus Radiata wooden poles 2021-04-19 12:00 RFQ321/2020/21
Supply and fit Tata LPT 1518TC truck reconditioned engine with a warranty 2021-04-19 12:00 RFQ322/20/2021
Pool of consultants for financial services provider to be appointed in the Greater Giyani Municipality for the period of three (3) years 2021-04-28 12:00 G/G/M/6105/001/2021
Supply and delivery of structural fire fighting helmets and spare structural fire fighting helmet face shields (visor) and fire fighting goggles 2021-04-19 12:00 RFQ323/2020/21

Pages

Who is the bidder or his or her representative?

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

In Organ of State tenders, the Standard Bidding Document 4 – Declaration of Inters – ask in paragraph 2.1 the following: “Full name of bidder or his or her representative... Read More

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