🚴‍♂️Stage 2: Initiation

In a previous topic, we looked at the different types of procurement process that exist: RFP, RFQ, transversal procurement and unsolicited bids.

With the exception of unsolicited bids, when an organ of state has an understanding of the need it must satisfy according to the planning stage, it will have an idea of what to procure. At this stage it will send out an RFP or RFQ, depending on the value of the requirements. An RFQ will be very specific in terms of items/services and quantities required. An RFP will outline a particular scenario (for example, a cloud computing network or construction of a new school) and expect the bidder to suggest a specific solution according to its knowledge of the subject matter.

You can see examples of RFPs and RFQs in this topic.

• The RFP is a document which sets out the rules for submitting a bid.

• The RFP will ask for information from bidders on their technical knowledge, the quality of their product or service and their experience in the field.

• Sometimes bidders will already be on a panel of bidders, which was set up by the procuring entity, and which the procuring entity frequently uses for its procurements. In this case, bidders will compete based on fewer criteria. The procuring entity is already familiar with the bidders level of expertise when they are on a panel.

• The tender will be advertised on the Government Tender Bulletin, the eTenders Portal and newspapers if applicable, for a minimum period of 21 days (including weekends/holidays).

Under the PPPFA (see this topic), suppliers can be preferred based on a points system similar to that used for B-BBEE, in order to achieve specific goals such as empowering small businesses or contracting with historically disadvantaged persons.

All interested bidders then submit proposals before the deadline.

• At a designated date and time, a representative of the procuring entity will open the submitted bids.

• While bids are being opened, the procuring entity must create a register of all of the bids it has received. This register must be made available on the procuring entity’s website within 10 days of the closure of the bid.

• Suppliers are allowed to attend the opening session where the names of the bidders will be read and recorded.

• The prices of bids should be read out in public.

• Sometimes (particularly in respect of infrastructure contracts) B-BBEE points claimed are also read out in public.

In cases of emergency (for example during the Covid-19 pandemic), or where there is only one potential supplier of a service, deviations from the process may be allowed. However, these circumstances can be exploited as a loophole.

The requirements set out in SCM Instruction Note 3 - 16/17 MUST be followed for any deviation to be allowable.

• An emergency procurement is a serious and unexpected situation that poses an immediate risk to health, life, property or environment, and there is insufficient time to invite competitive bids (for example, at the outbreak of Covid-19).

• A sole source procurement may only occur where there is evidence that only one supplier possesses the unique and singularly available capacity to meet the requirements of the procuring institution.

• A deviation for any other reason must first be approved by the relevant treasury (either National or Provincial).

• Deviations are permitted when unpredictable, real life events affect implementation of a procurement plan. Examples include anything from a flood that delays a road or bridge being built, to a fire in a publishing house that prints school textbooks.