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How to do business with TransnetWest Coast Business Alliance
Rooikrans, Vredenburg31 July 2017
Presented by: Elmondo Paulse
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Table of Contents
1. Transnet Operating Divisions
2. Transnet Support for Small Businesses & the Enterprise Development Hub Concept
3. Legislative Framework
4. Directive on Preferential Procurement Regulations - 2017
5. Must have’s 1-3 & eTender Portal
6. List of Major Projects
7. Artistic Impressions & Proposed future IDZ look
8. Q & A
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Transnet is the largest and most crucial part of the freight logistics chain that delivers goods to each and every South African
Transnet SOC Ltd is a public company; the South African government being its sole shareholder. Transnet operates and controls South Africa’s major transport infrastructures and is also responsible for ensuring that the country’s transport industries operate according to world-class standards, and that they form an integral part of the overall economy.
Transnet Operating Divisions
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Transnet Support for Small Businesses
Transnet acknowledges the importance of B-BBEE as a critical component ofachieving sustainable and inclusive economic growth.
Transnet acknowledges the plight of Small Businesses and recognises itsobligation as a State Owned Company to assist and develop sustainablebusinesses that will create jobs and add stimulus to the local economy.
Transnet has come up with programmes considered to provide extensivesupport to Small Businesses to bring them into Transnet Supply Chain andother Public Sector Supply Chain. Thus Transnet utilizes the HUB Concept tofoster new and grow existing enterprises - not just for our current procurementneeds, but more importantly for our future needs, therefore, in turn creatingan “enabling environment” for SMME’s to thrive through our HUBprogrammes.
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Transnet Enterprise Development Hub
Transnet formed a partnership with the WCBDC with the objective to develop,capacitate and support small businesses in the West Coast Region. “ONE STOPSHOP”
• To create an enabling environment for SMME’s to access economic development interventions that are provided by the strategic partners i.e. SEFA, NYDA, SEDA, DTI-CIPC, and SARS.
• To create a culture of entrepreneurship.• To unlock value, empower, capacitate, develop and prepare the
SMME’s to partake in the economy.• To transform Transnet’s supplier base ensuring active economic
participation of SMME’s; and• To develop and support new entrepreneurs through structured
training programmes and workshops.• To provide visibility of ALL procurement opportunities in the Region• To provide feedback of the outcome of the opportunities concluded.
Objectives
Target Market
• Aspiring entrepreneurs and small businesses in the West Coast Region.
• Military Veterans
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ESD aspirations is to make positive and sustainable impacts
Impact on the Local economy
Economic growth
Job creation Reduced logistics cost resulting
in reduced cost of doing business
Investment in plant and technology
Job creation
Reduced unemployment levels due to more economic opportunities
Skills transfer
Move from unskilled to semi-skilled workforce
Increase in speed and productivity of workforce
Increased diversity in work resulting in skills retention
Impact on Transnet
Reduced supply chain costs
Improved operational efficiency
Transformation within Transnet’s supply chain
Removal of exposure to foreign currency fluctuations
Lower stock level requirements
Greater responsiveness
Ease of communication
Shorter delivery times
Greater responsiveness
Ease of communication
Shorter delivery times
Security of supply
BBBEE compliance
Brand eminence building
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Legislative framework
S. 217
of the
Constitution
PFMA, PPPFA
BBBEE Act, CIDB Act
PAJA, PRECCA, PAIA
PFMA, CIDB & PPPFA Regulations
NT circulars/Instruction Notes
CIDB Instruction Notes; certain DTI initiatives
NT Guidelines & CIDB Standards for Uniformity
Court Rulings
National Development Plan & National Growth Plan
Industrial Policy Action Plan & Local Procurement Accord
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All contracts for goods or services must be done in accordance with a system which is:
Fair
• Everyone given the same opportunity to tender
• No favouritism
• Fair evaluation of tenders
Equitable
• Decisions must promote equity
• Preference to previously disadvantaged
Transparent
• Process must be open –nothing to hide
Competitive
• Promotion of open and fair competition
Cost –effective
• Best value for money must be obtained
• Value for money is not the same as cheapest price
What the law expects
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Directive on Preferential Procurement Regulations - 2017
- the applicable preference point system
- if unclear, indicate that the lowest acceptable tender will determine the applicable system
- pre-qualification criteria are applicable to the tender as envisaged in regulation 4
- the goods or services are in a designated sector for local production and content
- compulsory sub-contracting is applicable to the tender as envisaged in regulation 9
- objective criteria are applicable to the tender as envisaged in regulation 11
Planning (Regulation 3): An organ of state must determine and stipulate in the tender documents whether:
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Pre-qualification criteria - (Regulation 4)
- A tenderer having a stipulated minimum B-BBEE status level of contributor
- An EME or QSE
- A tenderer subcontracting a minimum of 30% to an EME or QSE which is –
* at least 51% BO
* at least 51% youth BO
* at least 51% women BO
* at least 51% BO with disabilities
* 51% BO livening in rural or underdeveloped areas or townships
* at least 51% BO who are military veterans -
- A tenderer subcontracting a minimum of 30% to an EME or QSE
- A tenderer subcontracting a minimum of 30% to a co-operative which is at least 51% BO
If an organ of state decides to apply pre-qualifying criteria to advance certain designated groups, it must advertisethe tender with a specific tendering condition that only 1 or more of the following tenderers may respond:
A tender that fails to meet any pre-qualifying criteria stipulated is an unacceptable tender
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Conditions for using pre-qualification criteria
Below R2 million:
General rule: apply one or more of the preferential procurement prequalification criteria as a standard to all transactions below R2 million (the quotation threshold).
Deviation will be allowed only in exceptional circumstances if there is no other alternative and the goods/services being procured from non designated groups are critical to operations.
In such a situation one would have to demonstrate that there are no or not enough tenderers in the market.
This would need to be validated by the OD/SU Head of Supplier Development.
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Preference Point System Tender value (inclusive of all
applicable taxes)
80 points for price & 20 points
for preference (80/20)
R30 000 up to R50 million
90 points for price & 10 points
for preference (90/10)
Above R50 million
Preference Point System
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Market related prices (1)
If the price offered by a tenderer scoring the highest points is not market-
related, Transnet may not award the contract to that tenderer.
In such instances, Transnet has the discretion to negotiate a market-related
price with highest scoring tenderer, failing which it can negotiate a market-
related price with the second highest ranked bidder and then the third
highest ranked bidder should the negotiations with the second ranked
bidder fail.
Alternatively, Transnet may choose to cancel the tender should it not
achieve a market-related price at any stage.
Transnet must cancel the tender if a market-related price is not achieved
after negotiations with the first, second and third ranked bidders.
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Market related prices (2)
After the price evaluation has been conducted, a check must be conducted toensure that the price obtained is market-related. This can be done by using one or acombination of the following approaches:
Historical pricing of the same goods/services taking into account inflation and market price fluctuations;
Benchmarking against prices that other organs of state and private sector companies similar to Transnet are paying for the same goods/services; and/or
Pricing of the highest ranked bidder versus the prices of the other bidders inthe process.
It is important to note that Transnet should not summarily disregard a price as not being market-related. Transnet has an obligation to clarify unreasonably low or high prices with tenderers. If a bidder is unable to justify their price, Transnet may then progressively proceed with the negotiation process indicated in the directive.
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MUST HAVE 1: You must have a registered company
www.cipc.co.za(Unless you’re sole proprietor)
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MUST HAVE 3: You must be on the NT Central Supplier Database
https://secure.csd.gov.za
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Tenders are advertised on NT e-Tender Portal
www.etenders.gov.za
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List of the Major Projects
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Artistic impression: Berth 205
Berth 205
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Artistic impression: Mossgas Jetty
Berth 205
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Proposed future IDZ look (1)
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Proposed future IDZ look (2)
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Disclaimer
The content of this presentation is for general information purposes only and should not be construed as creating an expectation of any nature whatsoever regarding the way forward relative to the issues under consideration.
Rights are fully reserved not to proceed in respect of the issues under consideration and to alter views expressed.
The basis upon which to proceed relative to the subject matter of this presentation, or not to proceed as the case may be, will be developed outside the ambit of this presentation and for this specific purpose the content of this presentation should not be relied upon.
Please be guided accordingly.
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Questions and Answers
Contact Details:
Elmondo Paulse – Regional Enterprise & Supplier Development Manager
081 036 8696 [email protected]
Thank You
