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: 

Finding Sub-contractors

According to the Draft Preferential Procurement Regulations, 30% of all Government Contracts above R30 million must be sub-contracted to specific categories of SMME’s. These categories are:

  • Black female owned EME’s or QSE’s;
  • Black youth owned EME’s or QSE’s;
  • Black owned EME’s or QSE’s.

Once the new Regulations are gazetted there businesses will need to find sub-contractors to fill this requirement.

Sub-contractors versus Consortiums and Joint Ventures

Tenders and subcontracting

Did you know tenders and subcontracting go hand in hand. In fact, subcontracting part of a tender is so common in South Africa that there are specific rules regulating subcontracting in executing tenders especially Government tenders.

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Title Closing Date Tender No.
Supply Electrical - components 2017-11-28 11:00 GH11800282
Supply & delivery of UIU for iron meter ACE 9000 plug in stand alone UIU. 2017-11-30 10:00 DIE0012861
Supply: C/breaker lv;mccb;175a;35ka;3p;lb 2017-11-28 11:00 GH11800285
Supply: Bushing boot:mv;usc;pilc 2017-11-30 11:00 GH11800287
Request for quotation for catering services for sport awards 2017 (once off) 2017-11-28 12:00 SCM 91 /2017
Supply & delivery of office furniture 2017-11-30 10:00 DIC0023196
Supply: Steel pipes 2017-11-30 14:00 GE11800797
Supply & delivery of bidim 2017-11-30 10:00 DIC0022898
Supply: 336 each x pwt slotted filter caps 2017-11-30 14:00 GE11800799
Construction of JB Marks disaster management centre. 2017-12-06 12:00 TENDER 49/2017
Replace corroded pipes with 316 shed 10 piping at Gordon’s Bay Pump Station 2017-12-04 12:00 SK11800202
Supply and Delivery of Padded Bags, Sweat Towels, Caps, T-Shirts and Golfers for Salga Games 2017-11-30 12:00 RFQ / 344
Supply: Shirts 2017-12-01 10:00 GA11800231
Construction of taxi rank and hawker stalls in Ikageng Exentsion 7 – Phase I & II. 2017-12-05 12:00 TENDER: 41/2016
Supply Wheelchair repair and maintenance spares 2017-11-28 12:00 GD11800523
Supply with Physiotherapy for Salga Games 2017-11-28 12:00 RFQ / 345
Supply Line nylon 2017-11-27 12:00 GD11800524
Supply back packs for fire fighters 28l backpacks needed for fire fighters 2017-12-01 10:00 GA11800232
Supply: Protective gear 2017-12-01 10:00 GA11800233
Occupational Health & Safety Risk Assessment 2017-11-27 12:00 T10-2017/18

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Functionality and Tenders

In all competitive bids (tenders) you as the bidder will have to respond to Functionality. You will need to score a set minimum number of points, measured as a percentage, on Functionality of a competitive bid (tender) in order to advance to the next phase of evaluation in the tender process.

Usually Organs of State evaluate competitive bids (tenders) as follows:

  • The tender response is evaluated on Functionality where the bidder must score points out of a maximum of 100 points.
  • A threshold of between 65 to 75 out of 100 points... Read More
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