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.
Invitation to tender for lease of Eskom owned residential properties located in the Eastern Cape Kouga Municipal district 2021-10-18 10:00 IRP308
Appointment of a Service Provider to perform actuarial valuations, build and transfer actuarial model for a period 36 months. 2021-10-25 11:00 TCF 16 2021/22
Provision for deep cleaning services for a period of 12 months 2021-09-30 13:00 EWSETA/RFQ/054/2021
Appointment of a suitable service provider for the supply and delivery of 129 laptop computers for the Free State Community Education and Training College 2021-10-25 11:00 RFT02/2021
Supply And Delivery Of Asphalt Bags 2021-10-29 12:00 TDR225/2021/2022
Supply And Delivery Of Butterfly And Dual Plate Check Valves 2021-10-29 12:00 TDR231/2021/2022
Fiber Connectivity For Internet Bandwith And Mpls Vpn Service Connection For The Joint Operations And Disaster Management Centre 2021-10-29 12:00 TDR242/2021/2022
Painting of The Multimedia Filters at The Mossel Bay Desalination Plant 2021-10-22 12:00 TDR244/2021/2022
Leasing Of The Tolhuis Together With The Adjacent Building On A Portion Of Erf 1001, Ceres 2021-10-14 12:00 08/2/19/12
Periodic Maintenance, General Repairs And Provision Of Spare Parts For Sweeper 2021-09-30 12:00 08/2/19/03
Provision of internal audit services for a period of 3 years 2021-10-18 11:00 RFP 06/2021
Service Provider Needed For Training Of Bus Operator 2021-09-29 12:00 6/5/2/111/A
Appointment of a service provider for the replacement of prepaid electricity meters with smart prepaid meters and related systems at various blocks of municipal flats located at Entokozweni, Emthonjeni and Emgwenya 2021-10-27 12:00 ELM22/09/01
Ntabankulu Local Municipality is looking for the services of extra law firms qualified to provide legal services inclusive of Civil and Criminal laws litigation, conveyancing services, commercial drafting, and labour matters for thirty-six (36) months. A detailed specification will be attached to the tender document. 2021-10-11 12:00 NLM/CS/PLS/2021/2022
Supply and installation of Software for Capturing and Processing of Traffic Fines for a period of three (03) years 2021-11-05 12:00 MNQ/SCM/29/21-22
Service Provider Needed For Training Of Bulldozer Operator 2021-09-29 12:00 6/5/2/111/B
Service Provider Needed For The Service Of Airconditioners At Various Fire Stations From Date Of Appointment Till 30 June 2022 2021-10-04 12:00 6/5/2/392
Supply, Installation, and commissioning of electromagnetic flowmeters at Ixopo Water Works 2021-10-04 15:00 Q21/807/ZC(A)
Verification Of Electronic Magnetic Flowmeters 2021-10-01 11:00 6/5/2/167/i
Supply and delivery of components to University of the Witwatersrand, Johannesburg 2021-10-08 11:00 iLABS/RFQ 2021/22:135

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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