Issue Date: 
Tuesday, September 20, 2016

10 Principles When Pricing Your Tender

We are often asked how to work out a tender price? But there is no straight answer because every tender is different. The fact is that a tender for the supply of furniture will have a different pricing structure to that of the supply of food for a government function. So to provide individual pricing techniques would be very difficult.

In general, there are ten points that must be considered when calculating price. These are:

  • Price is king – ensure that you price your product or service as low as possible in order to stand a chance of winning a tender.
  • Be precise; when the product supplied is R101-26 then state it in the tender response as R101-26 and not as R101-00 or even R102-00. Small differences like these can result in large amounts that can be lost, depending on the size of the tender.
  • Ensure that all the costs of delivering the product is taken into consideration; double check your pricing – omitting something small can come back and bite you later on.
  • Confirm prices of goods with your suppliers – prices can change very quickly due to increases in fuel prices or exchange rate fluctuations.
  • Always remember to add Value Added Tax (VAT) at 14% to your price especially when it relates to Government tenders. Most tenders state that the price must include VAT.
  • Ensure that all other applicable taxes are included in the tender price.
  • The most important piece of advice on Pricing: never bid too low or too high;
    • Bid Evaluation Committees are well informed and they will know if a bid is too low or too high;
    • Bidding too low or too high might lead to a tender response being disqualified or marked as non-responsive;
  • Pricing can be influenced by law as well – there are several industries in South Africa, such as the cleaning industry, which has minimum wages payable to employees;
  • A suggestion is that if your usual mark-up is 25% then tender perhaps at 18% to 20%. Remember that you are going to save on direct costs as well as on other expenses such as advertising, telephone costs and much more. Use these savings to lower your price.
  • Remember that in Government tenders you are going to be scored on your price and currently price counts for 80 out of 100 points for tenders less than R1 million and 90 out of 100 points for tenders with a value of more than R1 million. The bidder with the lowest price receives the most points.

To learn more about this and many other tender conditions please attend one of our How-to-Tender workshops. Tender Workshop dates are published on our website at

Learn to earn

Title Closing Date Tender No.
Business Turnaround Specialists Panel. 2018-04-13 14:00 RFP 12/2017
Appointment of a Debt Sponsor and a Panel of dealers for the IDC domestic Medium Term Note (DMTN) Programme. 2018-04-09 12:00 T12/03/18
Enterprise Development Tender for Start-up enterprises in the Plumbing, Refrigeration and Airconditioning services 2018-04-12 17:00 UM P&A – Startup Opp 2018
The appointment of a service provider to provide training for all CSOS Employees on conciliation (mediation) and adjudication (arbitration). 2018-04-10 11:00 CSOS009-2018
The provision of concrete structure repairs at the fabric filter plant for a period of 6 months at Camden Power Station. 2018-04-11 10:00 MPGXC005093
Appointment of a suitably qualified service provider to supply, install, and monitor power quality meters for a period of thirty six (36) months and train municipal personnel from date of appointment. 2018-04-11 10:00 11/2018/32 N32/2018
(Re-Advertisement) Appointment of a contractor for supply, delivery, installation, testing and commissioning of 11KV switchgear at NE 3 substation, Vanderbijlpark. 2018-04-11 10:00 11/2018/34 N34/2018
(Re-Advertisement) Appointment of a contractor for supply, delivery, installation, commissioning of 88KV switch gear at NE 3 substation, Vanderbijlpark. 2018-04-11 10:00 11/2018/35 N35/2018
(Re-Advertisment) Repair of protection in various substations for a period of thirty six (36) months on as and when required basis 2018-04-11 10:00 11/2018/36 N36/2018
Eskom Chartered Accountant (CA) Trainee Assessment System. 2018-04-11 10:00 CORP4372
As and When mechanical and electrical maintenance and repairs - COP 29 inspections of Rolling Stock Equipment. 2018-04-12 12:00 61/2017/CTN/RS
Provision of Major Maintenance and Reliability Substation Primary Plant in North West Operating Unit for 36 Months on an "as and when" required. 2018-04-12 14:00 PTATEN2398
Appointment of a services provider to render comprehensive hygiene services for a period of three (3) years. 2018-04-13 11:00 HSRC/04/2017/18
Provision of ablution facilities for a period of three years. 2018-04-17 12:00 CE:119
Invitation to submit proposals for establishment of a panel of professional service providers (PSP) to render professional multi-disciplinary services covering: Built-environment infrastructure projects for a period of three(3) years as and when required. 2018-05-04 12:00 T/2018/03/13/TECH/CONS
The provision of non-industrial cleaning, offices, kitchen and ablution areas at Duvha Power Station for the period of 3 (three) years. 2018-04-16 10:00 MPGXC005089
Supply and delivery of Protective Clothing for employees for 3 years. 2018-04-17 12:00 03/2018
Appointment of Service Provider for the Supply and installation of security equipment, X-ray Machines and Walk through Metal Detectors including a 5-year maintenance contract. 2018-04-19 12:00 SENT/043/2017-18
Manufacture and supply Antimony Lead Alloy Billets. 2018-04-20 12:00 355876
Short - term insurance from 1 July 2018 to 30 June 2019. 2018-04-20 12:00 WDM 02/2018


Tender adjudication process

The SBD/WCBD6.1 document must form part of all bids invited.  It contains general information and serves as a claim form for preference points for Broad -Based Black Economic Empowerment (B -BBEE) Status Level of Contribution, and explains how tenders or bids are decided.

The document says:

  • The bidder obtaining the highest number of points will be awarded the contract.
  • Preference points shall be calculated after prices have been brought to a comparative basis.
  • Points scored will be rounded off to two decimal places... Read More
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