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.
Appointment of a service provider to manage the implementation of expanded public works programme (EPWP) on school food garden project and Agriparks within the Gauteng Department Of Agriculture and Rural Development (gdard) for a period of thirty- six (36) months 2022-02-11 11:00 GT/GDARD/007/2022
Organising, managing and hosting a virtual Agri-Food Fest event 2022-02-11 11:00 GT/GDARD/006/2022
Appointment of service provider for supply and delivery of agricultural production inputs for subsistence producers within Gauteng Province for a period of thirty-six (36) months 2022-02-11 11:00 GT/GDARD/008/2022
Supply and delivery of office stationery for Gauteng Provincial Government (GPG) for a period of 36 months 2022-02-11 11:00 GT/GPT/002/2022
Provision of vehicle parking space for the Gauteng Department of e-Government for a period of 36 months 2022-02-11 11:00 GT/GDeG/001/2022
Integrated Waste Management Services at Cape Town International Airport 2022-02-14 12:00 CIA 6753/2021/RFP
Provision of Upgrade and Maintenance of College Website 2022-02-10 12:00 CO 22/02 O
Supply and delivery of protective clothing and equipment for a period of three years 2022-01-28 12:00 8/2/RNM0334
Provision of internal audit, risk and performance management system for a period of 36 months 2022-02-04 12:00 8/3/1-37/2021
Electrification of households at Dihlabaneng Turnkey 2022-02-07 12:00 Lim473/Dihlabaneng-Elect/21/22/25
Appointment of a Service Provider(S) to Render Guarding Services at The South African Social Security Agency (SASSA) Limpopo Region for a period of thirty six (36) months 2022-02-04 11:00 SASSA: 46-21-CS-LP
The supply and installation of 555.531m fence around the Zenzo Multipurpose Centre in KZN 2022-02-11 10:00 CORP 5615 - R
Provision of screening and verification services for GMM employees for a period of 36 months 2022-02-04 12:00 8/3/1-12/2021
Construction of Manyelrti to Mamone Central Internal Street 2022-02-07 12:00 LIM473/Mamone-road/21/22/24
Construction of Mochadi road and bridge 2022-02-07 12:00 LIM473/Mochadi-Road/21/22/23
Appointment of service provider for the supply, delivery, installation and maintenance of a chemical dosing pump including the wash and rinse aid chemicals for the hood-type dishwasher for a period of twenty-four (24) months to iThemba Labs, Faure, Western Cape 2022-02-04 11:00 iLABS/RFQ 2021/22:182
Supply, delivery, installation and commissioning of automated fluorescence microscope 2022-02-17 12:00 2021/056(a)
Supply and Delivery Of an Industrial Video-Scope 2022-02-17 12:00 2021/030(a)
Business insurance for a period of 12 months 2022-01-28 11:00 REQ0004252
Petrol 93 Unleaded 2022-01-27 11:00 ‪‪‪RFQ-012495

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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