As the global recession makes its mark on South Africa and the rest of the world, an increasing number of small businesses are suffering as a result of loss of business opportunities. Government work and state tenders offer a lucrative source of income and potential opportunities – especially for small and medium business holders. State contracts also give rise to the formation of sustainable business, creating employment opportunities for many, and assisting many small businesses during these tough financial times. By following a few basic guidelines and understanding how the procurement process works with regards to government tenders, businesses are able to vastly benefit from tenders such as these.
Government work and state tenders offer a lucrative source of income and potential opportunities – especially for small and medium business holders.
State contracts vary across a wide number of provinces, districts and areas, with a large number of industries including SAPS, hospitals, schools, healthcare facilities, administrative offices or facilities, construction and many other sectors. Government tenders work much like tenders in the private sector;
however procurement policies and contract terms may differ due to government administrative systems. Payment times, for example can differ substantially, with some contracts paid up to eight weeks after invoice instead of the typical 30 day period common with private sector contracts. This can cause financial setbacks for SMME (small and medium enterprises) who are relying on a lucrative contract and have to put up funds upfront to complete a project. This is why it is always best to fully understand procurement policies before submitting a tender, to ensure that you are completely aware of any specific terms or contract payment policies that could affect your business.
Another important factor to consider when submitting tenders for state contracts is the fact that the ‘preferred tender supplier’ aspect does not always apply to government projects. The aim of government tenders is to create opportunities for an even greater number of SMME’s, and often tenders are granted to one supplier for a project, and then granted to another supplier for the next project. Despite this, state tenders are highly rewarding, and can offer a considerable financial benefit for small businesses. Sustainable business is also created, with increased employment opportunities for both skilled and unskilled workers. Browse Online Tender’s comprehensive listing of current tenders in South Africa and find the government contract that best suits your business.