Tender Club

[sakkie]

Hi all

I own a small retail outlet in KZN and I am dealing more and more every day with tenders.

I have come to notice a few things:

1. There is a HUGE amount of companies out there that sole business is submitting tenders. Not necessarily just in a specific field but on any and every tender that is issued.
2. These entrepreneurs are usually young people and mainly women.
3. They are all registered on the appropriate databases, so it is CC's or PTY's, most VAT registered.

If a tender is issued in my field, I supply up to 6 companies with the same quote and I have now also build up a reputation where I source ANYTHING for them to assist with tenders. I my self are only registered on 2 databases where I submit tenders.

Now I was wondering:

Would it be viable to create a "Tender Club". Companies will be asked a joining fee and a monthly subscription for which they will receive the following:

1. Daily updates on available tenders.
2. Assistance with procurement.
3. Assistance with completion of tenders.
4. And at a later stage financing for successful tenders.

Any thoughts on this?

[Dave A]

Would it be viable to create a "Tender Club". Companies will be asked a joining fee and a monthly subscription for which they will receive the following:

1. Daily updates on available tenders.
2. Assistance with procurement.
3. Assistance with completion of tenders.
4. And at a later stage financing for successful tenders.

Any thoughts on this?

That sounds something like the pitch I got from the ANC's Progressive Business Forum.

So there's definitely a market.

[wynn]

Did it already and burnt my fingers badly.
Besides the whole BBBEE thing which they insist on, when tendering materials supply to a 'Tenderpreneur' you can't make more than 10% markup and in most instances, especially where large quantities are involved, less, now and again you can boost it to 20% but you need very tight credit control and insurance via some one like 'BCM' if the job is in the construction industry.
Most of the 'Tenderpreneurs' in my neck of the woods don't qualify for any credit whatsoever so the only alternative to cash up front (which entails cutting the profit to the bone) is to take out a cession for direct payment by the client but even then 'cessions' are slow to get paid, one of mine took a year to come to fruition and nearly cost me my life's work and sanity as well as burning my credit rating with most of my major suppliers.
Working on a 10 to 20% markup just don't cut it.

[sakkie]

Did it already and burnt my fingers badly.
Besides the whole BBBEE thing which they insist on, when tendering materials supply to a 'Tenderpreneur' you can't make more than 10% markup and in most instances, especially where large quantities are involved, less, now and again you can boost it to 20% but you need very tight credit control and insurance via some one like 'BCM' if the job is in the construction industry.
Most of the 'Tenderpreneurs' in my neck of the woods don't qualify for any credit whatsoever so the only alternative to cash up front (which entails cutting the profit to the bone) is to take out a cession for direct payment by the client but even then 'cessions' are slow to get paid, one of mine took a year to come to fruition and nearly cost me my life's work and sanity as well as burning my credit rating with most of my major suppliers.
Working on a 10 to 20% markup just don't cut it.

Hi Wynn

Did you finance the tenders?

[wynn]

Hi Wynn

Did you finance the tenders?

No, and don't go there if you value the color of your hair if it is not grey already. if it is grey be prepared for it to go white.

The idea of cessions for direct payment was introduced especially for the non credit worthy 'Tenderpreneur' and worked fabulously well for a few years but then the cadres took over the payment chain completely with the concomitant lack of urgency and the usual lost dockets, so and so not available to sign off etc. etc.

Rather let them get their own credit from banks and provincial development corporations etc. you can probably help them with the form filling etc. and may even earn a small finders fee, but for your sanity and the safety of your credit record for 'God's sake don't go there.

As an aside I suppose I did finance the tenders at the expense of my credit record and sanity. :-(