One of the most coveted business opportunities for any business person is winning a tender to supply goods and services in a government tender. The tenders are lucrative and a major boost to any business that wins the tender opportunity. The government sources goods and services from the public through tender. A tender is floated and an invitation is sent out for businesses to bid thereby enhancing quality competition for the best bidder to get the tender. The tendering process is very competitive, to win a tender, a tenderpreneur has to prepare several documents that will give his/her business an upper hand against other bidders. In this article, we dive into a checklist of tender bidding documentation tips for your business to increase your chances of winning a tender.
Article Overview
- What is a Tender
- An overview of the Tendering Process
- Eligible bidders for a Government Tender
- A Checklist Requirements while bidding for a Tender
- Tips on Tender Bidding Process
- Where to get Tender Opportunities Updates
What is a Tender
A tender is a formal invitation by the government to suppliers and/or contractors for the supply of goods, services, and works. The government issues tenders in many sectors, including but not limited to:
- Supply of goods
- Building and Construction contracts
- Cleaning and sanitization
- Rehabilitation works
- Provision of security services, among others
The Public Procurement and Disposal Act gives a guideline on the procurement process for public institutions in Kenya
The Tendering Process
The tendering process is similar across most public instructions since they are done in accordance with the Public Procurement and Disposal Act. The act aims at promoting competition among bidders and ensuring that competitors are treated fairly. It also promotes the integrity and fairness of those procurement procedures, increases transparency and accountability, and public confidence in them.
The private sector and private companies also have a tendering process where they are very similar to the Law. The adoption of these procedures in the private sector business is also aimed at having a smooth procurement process that is guided by procedures.
Across both public and Private procurement that is done through a Tendering Process involve the following Stages:
Tender Stages
- Invitation for Tender by a Procuring Entity
- Biding for the Tender
- Opening of the Tenders
- Evaluation of the bidder’s application documents
- Pre-Qualification of Successful bidder
- Awarding of Tenders
Eligibility to Bid Government Tenders
There is a certain minimum set as the threshold for a business or a person seeking to bid and participate in government tenders.
The Public Procurement laws outline people who are qualified to participate in bidding for Government tenders. This includes a person (business) that satisfies the following:
- The person has the legal capacity to enter into a contract for procurement or asset disposal
- A person who is not insolvent, in receivership, bankrupt or in the process of being wound up
- If the person is a member of a regulated profession, has satisfied all the
- professional requirements.
- The person and his or her sub-contractor, if any, are not debarred from participating in procurement proceedings
- The person has fulfilled tax obligations
- The person has not been convicted of corrupt or fraudulent practices
- The person is not guilty of any serious violation of fair employment laws and practices.
A business whether sole proprietorship, partnership or company that has a Spouse or children of a procuring entity officer where they have a substantial and controlling interest are considered ineligible to participate in public tenders.
However, such a business where a procuring officer has a family relationship can be eligible to bid the tenders if they declare a conflict of interest and the information of such tenders is not considered to be sourced from them.
A person or business whether private company or partnership whose spouse, children or sub-contractor of a procuring entity that has a substantial and controlling interest
Checklist of Requirements while bidding for a Tender
While bidding for any Tender the commonly requested documents that are requested for while submitting include:
- Certificate of incorporation
- Company CR 12
- Business Permit
- KRA/VAT PIN certificate
- Tax compliance certificate
- NHIF Compliance Certificate
- NSSF Compliance Certificate
- Company Profile
- AGPO certificate
We can help you with the preparation of the requirements for a tender, click on that whats app icon to get in touch with our team of experts. We will also give free tender bidding documentation tips to increase your success rates.
Business Certificate of Identification.
You can only bid for the tender if you have a legally registered business. In Kenya a business can be registered as either; Sole Proprietorship, Partnership or a Limited Company
The identification document for the business will be:
a.Business Name Registration Certificate for Sole Proprietorship and Partnerships business models registered under the Registration of Business Names Act.
b.Certificate of Incorporation for Companies incorporates under the Companies Act
Is your business registered as a Company? If not, get the Service here
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Business Permits are also a requirement as you bid for a Tender, the business permit/trading license is issued by the county governments where the business is operating. As the tenders are being evaluated the permit shows the business has a real physical address and it’s not a briefcase company.
Taxation Documents
The government collects revenue from its citizens through the taxation of incomes. As you will be expecting to win the tender and earn income, a fair share of that income should be accounted for and taxes paid.
To participate in a Tender, you will be required to submit Tax identification documents. This includes the KRA PIN for your business. For a business name, the Sole proprietor’s KRA PIN Certificate will be used, while for a Partnership or Company their KRA PIN Certificates.
A Tax Compliance Certificate is also another required document while biding for a Tender. The documents show that a taxpayer is compliant in terms of filing and paying KRA Taxes. If you do not have Tax Compliance for your personal Pin or your business, get it here today.
In terms of Tax Obligation, your KRA Pin must also be registered for Value Added Tax (VAT). This is the tax that should be charged on all vatable supplies by registered suppliers.
You should also have an Electronic Tax Register (ETR) that is TIMS compliant and in a position to generate a Fiscal Receipt as per the guidelines provided by the Law.
NHIF and NSSF Compliance Certificates
Currently, almost all government tenders are evaluating a business capability by also checking on the bidder’s compliance to all statutory requirements not only payment of KRA taxes, but also compliance to NHIF and NSSF.
NHIF Compliance Certificate
A business that has engaged employees should be registered with National Hospital Insurance Fund (NHIF) and it is required to remit the employee NHIF contribution monthly without failure.
A compliance certificate can only be issued by NHIF where the business is registered as an Employer with NHIF and has been filing the NHIF remittances.
NSSF Compliance Certificate
National Social Security Fund (NSSF) is also a statutory requirement where the business should contribute to the Retirement Security for its employees.
A business can only be issued with the NSSF Compliance Certificate if it is registered and issued with an NSSF employer code and has been compliant with filing and paying the NSSF returns on time.
AGPO Certificate
Access to Government Procurement Opportunities (AGPO) is a program that aims to promote the business that is run either by Youth, Women and Persons with Disabilities by giving them access to the reserved 30% government tenders.
If you are a business with a 70% majority being either Youth, Women or Persons with Disabilities, you should get AGPO Certificate to participate in the tenders reserved for AGPO.
Other Regulation Certification
If you are conducting business in a regulated sector, you will be required to submit the certification for conducting business in the regulated sector.
For instance, a business that is dealing with Construction related activities should be registered and have Certificates from the National Construction Authority (NCA), those dealing with Communications should have a Certificate from the Communications Authority etc.
You can see a List of different regulated industries and the regulators here so that you have tender bidding documentation tips specifically attached to such regulated business activities.
Tender Security
Some tenders require tender security, with an exemption of those that are reserved for AGPO certificate holders. Tender Security or a bid bond is a guarantee or bond from a tenderer’s bank or an insurance company which should be provided by the tenderer as part of its bid with the aim of protecting the procuring entity against the risk such as when the tenderer withdraws from the tendering process.
The Tender Security can be either be:
(a)Cash
(b) Letter of Credit
(c) Bank Guarantee obtained from commercial banks or
(d) Insurance Guarantee from Insurance companies.
You can check some of the providers of tender security from the PPRA website https://ppra.go.ke/tender-security-providers/
IFMIS
IFMIS is an Integrated Financial Management System, which is a portal that was introduced by the government to enhance an efficient and transparent manner of government procurement both at the national and county government level.
A business looking forward to bidding for government tenders should have an IFMIS account. The account can be created online from the Kenya Suppliers Portal
Tips on Tender documentation and Bidding Process
Tendering paperwork is quite a task. There are many papers that will need to be filled with accurate information provision of wrong information will definitely lead to automatic disqualification. When doing the paperwork, take your time and;
- Read all the issued documents very carefully and accurately
- Fill out the entire document without leaving unnecessary gaps
- Provide honest information throughout the filling process
- Stay within the proper price range
- Provide all the required documents without missing out on any.
Besides having the required documents, your business will be evaluated against non-cost assessment strategies involving the following areas;
- Quality assurance requirements
- Experience, skills, and available critical talent
- Company’s technical merit
- Hazards and risks related to the company
- The company’s ability to meet requirements such as;
- Administrative proficiency
- Financial sustainability
- Technical proficiency
- The appropriate expertise
Where to get Tender Opportunities Updates
You can get tender bidding documentation tips by reading the tender documents. Tender notices are circulated and advertised in a wide range of print and electronic media. You can find information on government tender from the following sources:
- Public procurement information portal: is the most comprehensive online platform for information on government tenders. Go to https://www.tenders.go.ke/website to search for information on procuring entities, suppliers, and tender notices, including contracts that have been awarded. Procuring entities upload information to this website on a monthly basis by the 15th of every subsequent month.
- Digital platforms/local websites: such as www.tenders.go.ke, www.tendersoko.co.ke, or www.tendersunlimited.com provide information on AGPO tenders as well as open tenders.
- AGPO website: provides access to tenders that have specifically been set aside for women, youth, and persons with disabilities. Go to the AGPO website at: https://www.agpo.go.ke/pages/tenders.
- Notice Boards: government tenders below certain thresholds are usually not advertised. Instead, such tender notices are placed on the notice boards of the procuring entities, national provincial administration offices, and chief camps.
- Newspapers: all Ministries, Departments, and Agencies currently advertise tender through the government newspaper called “My.Gov” which is circulated by inserting it in the Star and People Daily. AGPO tenders can also be found in the local dailies (e.g., The Nation and The Standard).
- Meet the buyer’s forums: are usually hosted by procuring entities who specifically invited businesses owned by women, youth, and PWDs to sensitize them about existing opportunities. Ensure you participate in these forums so you can build a relationship with these procuring entities. You can also identify and proactively approach procuring entities in your county and provide them with information about your business and what you have to offer.
- Individual Public Entity websites: public entities regularly advertise on their websites. If you are interested in supplying a specific Ministry, Department, Agency, or county government, you can go directly to their website to search for any current opportunities.
Wrap up on tender bidding documentation tips
Winning a government tender is the dream of every business person, it is not a walk in the park and as a business person, you must arm yourself with all necessary requirements and tender bidding documentation tips to increase the chances of winning the tender.
The basic requirement is to have a business registered as a legal entity, such as a Limited Company and have all the required documents including the compliance certificates. With the business having all the basic documents, you can get tender information from various sources and bid for the tenders.
To get more insights or help in the tendering process contact us via Email: info@anzianoconsultants.com or Mobile: +254706600875
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