Issue Date: 
Tuesday, September 11, 2018

Advantages and disadvantages of Joint Ventures

Joint Ventures are one of the most popular entities used to respond to tenders in South Africa. The question that arises is whether to use a Joint Venture or a Consortium in responding to a tender. To help you with this we have compiled a list of advantages and disadvantages for both Joint ventures as well as Consortiums. In this article we list the advantages and disadvantages of Joint Ventures. Look out for the same article on Consortiums.

Joint venture Advantages:

  • Provides companies with the opportunity to gain new capacity and expertise.
  • Enables companies to enter related businesses or new geographic markets or gain access to new technology.
  • Provides access to greater resources - including specialised staff and technology.
  • Shares risks with a venture partner.
  • Enables flexibility: a joint venture can have a limited life span and only cover part of what you do, thus limiting both your commitment and the business exposure.
  • Offers a creative way for companies to exit from non-core business.
  • Companies can gradually separate business from the rest of the organisation and eventually, sell it to another parent company. Roughly, 80% of all joint ventures end in a sale by one partner to another.

Joint Venture Disadvantages:

  • It takes time and effort to build the right relationships and partnering with another business can be challenging. Problems are likely to arise if:
    • The objectives of the business are not 100% clear and communicated to everyone involved.
    • There is an imbalance in the level of expertise, investment or assets brought into the venture by the different parties.
    • Different culture and management styles result in poor integration and co-operation.
    • The partners do not provide enough leadership and support in the early stages.
  • Creating a joint venture may result in more complex tax arrangements.
  • Success in a joint venture depends on thorough research and analysis of the objectives.
  • Creating a joint venture can be more costly than a consortium.

To learn more about this and many other bid conditions please attend one of our HowtoTender workshops. For more information on the tender courses please email Estelle at estelle@how2tender.com.

Title Closing Date Tender No.
Harding: St Andrews Hospital: Department of Health: Hire of Residential Accommodation to Accommodate 14 X Community Service Officers for a period of 12 months 2019-04-25 11:00 ZNT 2846W
Kokstad: E.G. Usher Memorial Hospital: Department of Health: Hire of Residential Accommodation to Accommodate 21 X Community Service Officers for a period of 12 months 2019-04-25 11:00 ZNT 2848W
Provision of Security Services at Frontier regional Hospital site, in the Eastern Cape Department of Health for a period of 36 months. 2019-05-02 11:00 SCMU3- 18/ 19- 0527- FRH
Rendering of a Cleaning Contract at the Military Acadamy, Saldanha for the period of one (1) year as per User Requirement Specification MILACAD/01/18. 2019-04-24 11:00 SPSC- B- 069- 2018
Placement of a dedicated cardioplegia - delivery pump using microplegia method of administration and supply of sole - property associated consumables including a fully comprehensive maintenance contract for Groote Schuur Hospital for a three (3) year period (optional to extend for an additional two (2) years) 2019-04-23 11:00 GSH: PT48/ 2018
Supply and delivery of two (2) crawler tractors to the South African Police Service: Division: Human Resource Development. 2019-04-23 11:00 19/ 1/ 9/ 1/ 107 TV(18)
Supply and delivery of twenty seven (27) cattle trailers to the South African Police Service: Division: Detective Services. 2019-04-23 11:00 19/ 1/ 9/ 1/ 128 TV(18)
Supply and delivery of twenty (20) luggage trailers to the South African Police Service: Division: ORS. 2019-04-23 11:00 19/ 1/ 9/ 1/ 129 TV(18)
Supply and delivery of hydraulic loading crane to the South African Police Service: Division Operational Response Services 2019-04-23 11:00 19/ 1/ 9/ 1/ 130TV(18)
Appointment of a service provider for leasing, support and maintenance of 112 scanners and 6 book scanners for the Deeds Registries: Pretoria, Johannesburg, Cape Town, Pietermaritzburg, Bloemfontein, Mpumalanga, King Williams Town, Kimberley, Vryburg, Limpopo and Mthatha for a period of thirty six (36) months. 2019-04-12 11:00 DRDLR (CRD- 21) 2018/ 19
Maintenance and repair of SAPS helicopters and aircrafts for a period of two (02) years for the South African Police Service 2019-04-23 11:00 19/ 1/ 9/ 1/ 114TA (18)
The supply and delivery of labels, ribbons and boxes used by Clinicom, Jac and primary healthcare systems for all Western Cape Health facilities for a three (3) year period. 2019-04-19 11:00 WCGHSC0195/ 2019
Appointment of a suitable service provider to conduct a skills audit for the KwaZulu-Natal Department of Education for a period of three years from date of award 2019-04-11 11:00 ZNB 0005 E/ 2018/ 2019
Appointment of a panel of eight (8) service providers to render car hire and related services to Statistics South Africa (Stats SA) for a period of thirty-six (36) months. 2019-04-22 11:00 Stats SA 011/ 18
Appointment of a Service Provider’s for the Rendering of Vehicles Auctioneering Services to the South African Police Service Nationally (Per Province) for a period of two(02) years 2019-04-24 11:00 19/ 1/ 9/ 1/ 119 TP (18):
Supply and Delivery of Daily Newspapers for Navy Headquarters for a Period of One (01) Year. 2019-04-25 11:00 CPSC- B- PC- 058- 2018
Provision of NIMS-Support and Maintenance tender for the three RSR Regional Offices( Gauteng,Kwa-Zulu Natal and Western Cape Province) 2019-04-23 12:00 RSR/ NIMS/ 001/ 03/ 2019
For the Provision of Long Term Advisor Services to the Government Technical Advisory Centre (GTAC) for the Office of the Accountant General (OAG) to Support in the Implementation of the Municipal Finance Improvement Programme (MFIP) Phase III - Provincial Treasury Revenue Management Specialists 2019-04-12 11:00 GTAC 028- 1- 2018
For the Provision Of Long Term Advisor Services to the Government Technical Advisory Centre (Gtac) for the Office of the Accountant General (OAG) to Support in the Implementation of the Municipal Finance Improvement Programme (MFIP) Phase III - Asset Management Specialists 2019-04-12 11:00 GTAC 026- 1- 2018
For The Provision of Long Term Advisor Services to The Government Technical Advisory Centre (GTAC) for the Office of the Accountant General (OAG) to Support in the Implementation of the Municipal Finance Improvement Programme (Mfip) Phase III - Provincial Treasury Advisors 2019-04-12 11:00 GTAC 023- 1- 2018

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The 8 steps in the Tender Adjudication process

By W van Rooyen

www.howtotender.co.za

31 January 2019

It is important to understand the Adjudication process when one responds to a Tender or Request for Proposal. If you have these 8 steps under control when responding to tenders, changes are good that you will proceed to the next round.

Here are 8 steps in the adjudication process that Organs of State will most often follow in determining which bidder will win the tender:

  1. Opening... Read More
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