To succeed in being awarded government tenders in South Africa, you have to submit winning proposals in response to advertised tender opportunities. The starting point for doing this is to meet all the proposal requirements.
The tender process is demanding, but don’t worry. Do it once and it’s much easier the next time. Here, we cover exactly what’s needed.
Register your business
Before you can bid on government tenders, you must register your business on the Central Suppler Database (CSD).
The database contains a list of organisations, institutions and individuals that are able to provide goods and services to government.
You can register your business online by visiting the National Treasury website. This registration is an expression of interest. Your candidacy will then be assessed and approved.
Proposal requirements: what documents to include
Once your registration on the CSD is approved, you’re free to bid on tenders. This is a list of what must be included in your proposal.
The proposal itself
Your proposal will be an introduction of your company and what you offer. It must justify why your business would be the best option for the tender in question.
Ensure you have read the tender notice carefully. Your proposal must answer any questions and make it clear that your business can handle the contract.
Keep your language simple yet comprehensive. Include any relevant experience, such as previously completed jobs in the same sector.
Get your proposal proofread and edited by a professional, so that it is professional and straightforward.
Required Standard Bidding Documents (SBDs) for SA government tenders
Government tenders require a few Standard Bidding Documents (SBDs) to be included with your proposal. These include:
SBD 1 Invitation to bid
This is an agreement that you will be bound by the terms and conditions of the bid.
SBD 2 Tax clearance certificate requirements
This is an application for tax clearance certificate form that you must complete and send to SARS to obtain a tax clearance certificate.
SBD 3.1 or 3.2 or 3.3 Pricing schedule
This includes a pricing schedule and a motivation for the pricing schedule. You must justify your pricing by describing the product or service, and detailing the experience of the person(s) who will perform the service.
SBD 4 Declaration of interest
This requires a Declaration of Interest from applicants, stating any existing relationships with government employees. This is to avoid conflicts of interest and corruption.
SBD 5 National Industrial Participation (NIP) Programme
This is an optional SBD that only applies to Industrial Participation Programme. These are contracts with imported content of US$10 million or higher that have an industrial participation (IP) obligation.
SBD 6.1 Preference points claim form
This document allows you to claim preference points according to your Broad-based Black Economic Empowerment (B-BBEE) status Level.
SBD 7.1 or 7.2 or 7.3 Contract form
This document includes the contract that binds all parties if the bid is successful. There are different forms for purchases (7.1), services (7.2), and sales (7.3).
SBD 8 Declaration of bidder’s past supply chain management practices
This is a declaration that you have not abused the supply chain system in the past and that you are not listed on the National Treasury website as a previous offender.
SBD 9 Certificate of independent bid determination
This is a declaration that all reasonable steps have been taken to prevent any form of bid rigging.
Tax clearance certificate
As stated, you must use the SBD 2 to obtain a tax clearance certificate from SARS. Once you have this certificate, it must be included in your tender bid.
Other requested documentation
The advertised tender might also request other supporting documentation. This will differ depending on the type of tender. Usually, one or more of the following documents are requested:
- A certified copy of Company Registration Document that reflects company name, registration number, date of registration and active directors or members.
- A certified copy of shareholders’ certificates.
- A certified copy of ID documents of the directors and members.
- The last three years of audited/reviewed financial statements.
- A letter of guarantee from a registered financial institution or financier covering three months’ operational costs as per bidder’s proposed costs.
- Proof of public indemnity cover for a minimum of R1 million.
- A letter of good standing with Department of Labour for Unemployment Insurance Fund.
- A letter of good standing with Department of Labour for Compensation for Occupational Injuries and Diseases.
- Proof of compliance/registration with the relevant industry regulator/association.
SMEs may find it challenging and costly to meet requirements involving guarantees of operational costs and public indemnity cover.
Thankfully, these aren’t always required but they can be key to securing your first big contract.
Attend any briefings – and don’t miss the deadline
The tender advertisement will include the details of any briefings to be held. It’s vital that you attend these briefings to ensure you know all the requirements for a winning proposal.
The advert will include the deadline and the address to which the proposal and completed forms must be delivered.
Deadlines for tenders are strict. If you miss the cut-off date, you will miss the opportunity completely. Don’t forget, there’s a lot of competition for government tenders.
Your business is awarded a government tender: now what?
Some businesses don’t bother bidding on tenders because they don’t have the capital to complete the contract, despite being a capable and experienced choice.
At BizFunding, we partner with businesses to provide up to 100% funding for tenders. This allows you to bid on tenders with confidence, without worrying about the money needed.
Our profit-sharing model allows us to fully fund your tender, guide you through the contract with our extensive experience, and ensure a successful contract that will help you secure more tenders in the future.
If you have been awarded a government tender and you need funding, contact us on 012 001 0095 to learn more or apply online to get funding within 72 hours.
