Issue Date: 
Thursday, October 31, 2019

Sub-contractors versus Consortiums and Joint Ventures

By Werner van Rooyen, Director of HowToTender (Pty) Ltd which specializes in tender consulting and tender training.

The Preferential Procurement Regulations, 2017 states that, if it is feasible, 30% of all Government Contracts above R30 million must be sub-contracted to specific categories of SMME’s.  These SMME’s include, but are not limited to, black female owned and black youth owned businesses.

To help with the confusion that arises from whether one must form a Joint Venture, Consortium or sub-contractor/contractor relationship when responding to a tender it is always good to understand the definition of these types of business relationships:

  • A sub-contractor/contractor relationship arises when a main contractor hires or employs additional businesses or persons outside of the main contractors own business to do work or to deliver services as part of a larger project.  The important thing to remember is that the main contractor is in charge and must ensure that the project is executed and completed as stipulated in the contract.
  • A consortium is an association of two or more individuals, companies, or organisations with the objective of participating in a common activity, such as responding to a tender, or pooling their resources to achieve a common goal.  Within the consortium, each participant retains their separate legal status and the consortium’s control over each participant is limited to activities involving the joint endeavour, particularly the division of profits.  A consortium is formed by contract.
  • A Joint Venture can be described as a business enterprise where two or more participants come together to share their expertise to win a specific contract for a set period.  A Joint Venture is a separate entity and is not part of the individual participant’s own enterprise.  Therefor a Joint Venture must have its own set of rules by which it is managed, and this is called a Joint Venture Agreement.

To become a sub-contractor, you will have to have a running business.  Main contractors will only use dependable sub-contractors with a proven track record.

To learn more about this and many other tender conditions attend our “Become a Tender Expert” 2-Day workshops 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 wernervr@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.
Placement of next generation sequencer for a period of (5) five years for Virology Doctor George Mukhari with service and maintenance. 2020-10-09 11:00 RFB187/ 19/ 20
Standard Laptops 2020-10-13 11:00 0010430697
Renewal of Mimecast licenses for KwaZulu-Natal Department of Human Settlement for a period of three (3) years. 2020-10-09 11:00 RFB 2130/ 2020
RFB 2226/2020: Supply, install and configure an electronic mail secure archive and compliance solution to Sita with maintenance and support for a period of five (5) years 2020-10-09 11:00 RFB 2226- 2020
Supply and delivery of Lidar camera (with maintenance and spares contract) and post-processing software (including updates) for the SAEON Elwandle Node’s existing Airborne Remote Sensing Platform in Port Elizabeth 2020-10-23 11:00 NRF/ SAEONLIDAR/ 12/ 2020- 21
Supply and delivery of 9mm and 5.56mm ammunition to the Public Transport Enforcement Services Directorate for a 3 year project 2020-10-09 11:00 ZNB0068/ 19T
Appointment of a suitable service provider for a once-off supply, delivery and installation of office furniture at the Office of the valuer General Centre Walk building. 2020-10-09 11:00 OVG (03) 2020/ 21
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Ugu District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 0799-0958 E/ 2019/2020 2020-10-09 11:00 ZNB 0007 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Umlazi District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 1325-1450 E/ 2019/2020 2020-10-09 11:00 ZNB 0010 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within iLembe District under the National School Nutrition Programme (NSNP) for Kwazulu-Natal Department of Education for the duration of the current tender ZNB 0249-0379 E/ 2019/2020 2020-10-09 11:00 ZNB 0004 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Umzinyathi District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 1451-1595 E/ 2019/2020 2020-10-09 11:00 ZNB 0011 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Umgungundlovu District under the National School Nutrition Programme (NSNP) for KwazZulu-Natal Department of Education for the duration of the current tender ZNB 0959-1127 E/ 2019/2020 2020-10-09 11:00 ZNB 0008 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Pinetown District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 0600-0798 E/ 2019/2020 2020-10-09 11:00 ZNB 0006 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within King Cetswayo District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 0380-0599 E/ 2019/2020 2020-10-09 11:00 ZNB 0005 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Amajuba District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 0035-0126 E/ 2019/2020 2020-10-09 11:00 ZNB 0002 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Harry Gwala District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 0127-0248 E/ 2019/2020 2020-10-09 11:00 ZNB 0003 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Umkhanyakude District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 1128-1324 E/ 2019/2020 2020-10-09 11:00 ZNB 0009 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Uthukela District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 1451-1595 E/ 2019/2020 2020-10-09 11:00 ZNB 0012 E/ 2020/ 2021
Expression of interest in the appointment of service providers to be included in a database for the replacement of defaulting service providers and allocation of new clusters in the provision of food items [perishables and non–perishables] to feeding schools within Zululand District under the National School Nutrition Programme (NSNP) for KwaZulu-Natal Department of Education for the duration of the current tender ZNB 1451-1595 E/ 2019/2020 2020-10-09 11:00 ZNB 0013 E/ 2020/ 2021
Call for expression of interest to provide various off-the-shelf eLearning courses 2020-10-07 15:00 AUC/AHRM/C/006

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