3 Sub-contracting rules to be aware of when responding to tenders

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 that has been implemented on the 1st of April 2017. Many entrepreneurs ask us whether they should sub-contract or not, in responding to a tender and how and where do they get onto the sub-contracting lists.

There seems to be a lot of confusion amongst entrepreneurs when it comes to tenders and sub-contracting. The Draft Preferential Procurement Regulations, have been gazetted and are currently up for review. However, these Regulations are the major cause for the confusion. Many entrepreneurs ask whether they should sub-contract or not whilst responding to a tender.

Finding Sub-contractors

These categories are:

  • Black female owned EME's or QSE's;
  • Black youth owned EME's or QSE's;
  • Black owned EME's or QSE's.

After the Preferential Procurement Regulations were gazetted there is a need for businesses to find sub-contractors.

But where are businesses, which respond to tenders, going to find sub-contractors? We have thought about this and one answer is at Briefing Sessions.

Sub-contractors versus Consortiums and Joint Ventures

The Preferential Procurement Regulations, 2017 states that 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.

Tenders and Subcontracting

Tenders and subcontracting go hand in hand. In fact, subcontracting part of a tender is so commonly placed that in South Africa there are specific rules regulating subcontracting in executing tenders. This is especially true for South African Government tenders.

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Title Closing Date Tender No.
Provision of community outreach services (COS) by community based organisations (NPO`s)/ non profit organisations in the four health districts of the Eastern Cape namely Alfred Nzo, Joe Gqabi, Nelson Mandela Metro and Sarah Baartman for three consecutive financial years 2019/2020; 2020/2021 and 2021/2022. 2019-07-15 11:00 SCMU 3- 19/ 20- 0084- HO
Rendering security services at Tshwane Region for a period of eighteen (18) months 2019-07-12 11:00 GT/ GDSD/ 030/ 2019
Supply, delivery and off-loading of veneered medium density fibre (MDF) and high density fibre (HDF) boards for a period of three (3) years (36 months) 2019-07-15 11:00 DCS10/ 2019
Supply, delivery and off-loading of day old broiler chicks to various correctional centre farms for a period of 36 months (3 years): Department of Correctional Services. 2019-07-15 11:00 DCS 8/ 2019
Installation and Maintenance of Security System at DOD Logistic Support Formation for a Period of Three (03) Years 2019-07-22 11:00 CPSC- B- PC- 003- 2019
Pretoria: Centurion: Erasmia Police Station: Construction of platforms, External works and connection of services, Water, Sewer and Power to erven 656 & 657: Completion Project 2019-07-23 11:00 Pt19/ 007
The province of KwaZulu-Natal, Department of Transport, invites tenders of Vukuzakhe Contractors for the Betterment and Regravelling of D1805 Contract 2 in the Nongoma Municipality within the Zululand District. The duration of the project will be 3 months. 2019-08-13 11:00 ZNT373/ C265/ 2045/ S/ 2/ 2018T
The province of KwaZulu-Natal, Department of Transport, invites tenders of Vukuzakhe Contractors for the Betterment and Regravelling of A996 in the Nongoma Municipality within the Zululand District. The duration of the project will be 3 months 2019-08-13 11:00 ZNT373/ C265/ 2021/ S/ 1/ 2018T
Supply and Delivery of Product Training (PLC, Traffic Lights and Work Benches) 2019-07-17 11:00 PUR 5800/22
Five New Fifteen Seater Busses for Various Sites 2019-07-17 11:00 PUR 3103/1
The province of KwaZulu-Natal, Department of Transport, invites tenders of Vukuzakhe Contractors for the Betterment and Regravelling of L2602 Contract 1 in the Ulundi Municipality within the Zululand District. 2019-08-13 11:00 ZNT373/ C266/ 2111/ S/ 1/ 2018T
Supply, deliver and registration of skip loader truck 2019-07-05 10:00 T/FLEET/06/02/2019/2020
Summarizing; compiling and printing of all municipal documents 36 months 2019-07-05 10:00 T/MM06/01/ 2019/2020
Operational leasing and maintenance of office automation ; photocopying machines for 36 months 2019-07-05 10:00 T/ICT/06/03/2019/2020
Supply, deliver, install and maintenance of internet, Wan (internet Wan connecting remote offices) and voice over the internet protocol (VOIP) for 36 months 2019-07-05 10:00 T/ICT/06/02/2019/2020
Supply and delivery of Microsoft licensing (Microsoft volume licensing) renewal of existing licenses for 36 months 2019-07-05 10:00 T/ICT/06/01/2019/2020
Appointment of a service provider to provide Transaction Advisory Services for the Sourcing of Capabilities Programme 2019-07-19 11:00 GEMS/TransactionAdvisor/2019/CON010
Appointment of a service provider to provide Phase 3 of the GEMS Learnership Programme which focuses on soft Skills 2019-07-19 11:00 GEMS/LearnershipProgramme / 2019/CON009
Appointment of a panel of service providers to provide Travel Agency services for the Government Employees Medical Scheme for a period of one (1) year commencing 01 January 2020, which contract may be annually renewable for a maximum of 2 more years 2019-07-18 11:00 GEMS/TravelAgencyPanel/2019/CON008
Total water treatment service - Request for initial response of interest 2019-06-25 10:00 IRI DSP 05/06/2019

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2 items that determine tender pricing

Article by Werner van Rooyen

www.howtotender.co.za

31 January 2019

Many bidders that respond to tenders struggle when it comes to calculating a price for a specific tender. One of the reasons for this is that a large number of Small Business Owners are usually new to the tender process and therefore they lack the necessary experience to price their bids correctly.

Without getting into the fundamentals of accounting there are two basic items that determine your... Read More

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