Issue Date: 
Tuesday, November 1, 2016

When to sub-contract?

There seems to be a lot of confusion amongst entrepreneurs when it comes to tenders and sub-contracting, due in large part, to The Preferential Procurement Regulations, 2017 which came into effect on 1 April 2017. Many entrepreneurs ask us whether they should sub-contract or not, when responding to a tender.

Regulation 9 of The Preferential Procurement Regulations 2017, stipulates the following:

1: If it is feasible to sub-contract for a contract above R30 million, an Organ of State must apply sub-contracting to advance designated groups.

2: The Organ of State must advertise this specific tender condition that the successful bidder must sub-contract at a minimum of 30% (of the value of the contract) to (one or more) to an EME or QSE which is at least 51% owned by:

a.    black people;

b.    black people who are youth;

c.    black people who are women;

d.    black people with disabilities;

e.    black people living in rural or under develop areas or townships;

f.    black people who are military veterans;

g.    A cooperative which is at least 51% owned by black people;

3: In paragraph 3 of Regulation 9 it also states that the Organ of State must make available the list of all suppliers registered on a database approved by the National Treasury to provide the required goods or services in respect of the applicable designated groups mentioned above from which the bidder must select a supplier.

Regulation 9 is very clear because its states "the tenderer MUST sub-contract…..". Thus, according to the Regulations all contracts with a value of R30 million and above will have to comply with this Regulation. Read the tender document carefully because somewhere in the tender document it will stipulate whether or not the bidder will have to sub-contract. Follow those rules. If the tender document doesn't contain any sub-contracting instructions then it is not necessary to sub-contract.

The fact is that the tender document will dictate what you should or should not do. Read the tender document carefully, follow the instructions precisely and to the point.

To learn more about this and all the other new developments regarding tenders, please attend one of our How-to-Tender workshops. Tender Workshop dates are published on our website at www.how2tender.com. For more information on the tender courses please email Werner at werner@how2tender.com.
 
This article was written by Werner van Rooyen, Director of HowToTender (Pty) Ltd. which specializes in tender consulting and tender training.

Title Closing Date Tender No.
Ceza Stand Alone Water Supply Phase 2: Reticulation 08 2018-09-04 12:00 ZDM 088/ 2018
Supply and Installation of Concrete Universal Sleepers at various Turnouts within Western Cape Region. 2018-09-11 12:00 02/2018/CTN/INFRA
Ceza Stand Alone Water Supply Phase 2: Reticulation 07 2018-09-04 12:00 ZDM 087/ 2018
Installation of concrete mast poles and optic fibre cable. 2018-09-11 10:00 RFQ CRAC-KGG-27518.
Ceza Stand Alone Water Supply Phase 2: Reticulation 06 2018-09-03 12:00 ZDM 086/ 2018
Ceza Stand Alone Water Supply Phase 2: Reticulation 05 2018-09-03 12:00 ZDM 085/ 2018
A5 -Informal Trading- Permit Paper. 2018-08-29 12:00 SD11900134
Supply and delivery of iphone. 2018-08-24 11:00 GK11900074
Ceza Stand Alone Water Supply Phase 2: Reticulation 04 2018-09-03 12:00 ZDM 084/ 2018
For the provision of stripping, fault finding, repair, installation, testing and commissioning of coiling machine situated at RSE Business Bay 64 Durban. 2018-09-11 10:00 TE18-DBN-06I-06087
Supply and Delivery of Cape Times or Cape Argus (Morning Edition) and Die Burger Newspapers for the Business Express Train Services. 2018-09-11 12:00 12/2018/CTN/CS
Rural Roads Assets Management system 2018-09-19 12:00 ZDM095/2018
Water Loss and Demand Management System 2018-09-19 12:00 ZDM096/2018
Rehabilitation of Service Roads within the Western Cape Region. 2018-09-11 12:00 01/2018/CTN/INFRA
Register on the Database for Panel of Attorneys 2018-09-10 12:00 ZDM 098/2018
Supply and delivery of security clothing. 2018-09-18 11:00 CD19 B/2018
Hiring of an excavator for 30 days for Regravelling of Gravel Roads in Region 1 (Bethal and Emzinoni) 2018-08-27 12:00 RFQ NO: 8/3/2- 59/2018
Sethembe Emerging Contractors Programme 2018-08-30 12:00 ZDM103/2018
Head of actuarial function services. 2018-09-19 12:00 2018/11
Supply and delivery of Total Station and Accident/Crime Scene Mapping Software as per specification 2018-08-23 15:00 KEQ.EMPD.10.87 RE-ADVERT

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10 steps in the bid process

Each year, Organs of State invite the Private Sector to submit competitive bids for the supply of goods and services. Organs of State bid requests attract SMME's and large businesses across a wide range of sectors - from office supplies to major construction projects.

Here is an overview of 10 steps you should take to prepare a competitive bid.

1.    Register your interest

Follow the instructions in the bid document to register your interest with the purchasing agency. This important step will help keep you up to... Read More

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