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.
Professional service provider to render cash collection services for a period of thirty six(36) months 2021-03-25 11:00 LNM003/2019/2020
Supply and delivery of Hand Held GPS for GIS data 2021-03-05 11:00 OLT1245730
Supply and delivery of an industrial video-scope 2021-03-25 12:00 2021/030
Appointment of civil engineering consultant and contractor for the upgrading of internal street from gravel to tar zone s ward 16 (turnkey project) 2021-03-30 11:00 LNM002/2020/21
Tarring of internal streets in Unit B 2021-03-31 11:00 LNM 001/2020/21
Training on mental illness / wellbeing management in the workplace 2021-03-08 11:00 No reference number
Proposals for the cost of supply study to determine electricity tariffs in accordance to National Energy Regulator of South Africa (NERSA) 2021-03-16 12:00 MKHO29/2020/21
Supply and delivery of ICT equipment 2021-03-26 11:00 LNM0034/2020/21
Metrorail Customer Services Uniform 2021-03-05 16:00 10319794
Professional service provider for provision of printing services for a period of 24 months 2021-03-29 11:00 LNM044/2020/21
Appointment of Service Provider to develop a Pricing Model for SENTECH’s Products and Services 2021-03-12 12:00 SENT/040/2020-21
Supply and delivery a trailer mounted high pressure drain cleaning jetter machine at facilities depot. 2021-03-01 12:00 JET-MACHINE/02/2021
Provision of satelite systems (VSAT) and LAN network system for Phelophepa trainset 1 & 2 for Salt River Coach Business and Covid-19 vaccination trainset for Koedoespoort Coach Business 2021-03-16 10:00 TE21-KLP-8HB-00135
Borehole drilling at Kaapmuiden 2021-03-01 12:00 BOREHOLE/03/2021
Procurement Of 2 Server For The Department Of Military Ombudsmen. 2021-03-02 11:00 RFQ 4034-AH-2020
Supply Installation and Integration of Wireless Communication System for Television & Radio Broadcast Facilities 2021-03-22 12:00 RFP/TVO/2021/2
supply and delivery of TSI pump Calibrators for Operation and maintenance of continuous ambient air quality Monitoring Station 2021-03-10 11:00 DPEMS-E60/2020/2021
Refurbishment of Sefako Makgato fire station 2021-03-15 11:00 COR-A57/2020/2021
Supply and delivery of class II type A2 biological safety cabinets for Forensic Pathology Service, Western Cape 2021-03-26 11:00 WCGHCC104/2020
Administration and management of disaster management volunteers 2021-03-26 11:00 COMM-D15/2020/2021 (Re-advert)

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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