REVEALED:Why Most SMEs & Youth Miss Government Tender Contracts in kenya
When the government announced in 2013 that 30 percent of the value of all government contracts should be allocated to youth, women and people with disabilities (PWDs) many SME owners (mostly youths) moved with speed to exploit the opportunity. This policy was aimed at tackling soaring levels of unemployment across the country.
On the downside, though, despite Ksh205 billion worth of contracts being up for grabs not many youth-run enterprises seem to win the tenders. Could it be due to lack of patience to walk through the long tendering process? Could it be due to poor documentation and quotations? Or is it corruption?
Here are some of the common reasons why many SME owners miss the govt’s lucrative tender opportunities. Below each reason, we’ve included a tip on how to avoid it and increase your chances of winning a tender deal.
(1) Poor documentation and quotation
According to observations made so far, a lot of youth do not stick within stipulated price guidelines of specific contracts. Most either over-price or under-price and this makes them ineligible for consideration.
You can easily avoid this error(s) by applying through The Government’s financial platform, IFMIS, which is fully available online. Before you apply, make sure you do a bit of research on pricing just to make sure that your pricing is right.
(2) Not fulfilling the basic requirements
Another observation made so far is that most of those interested in government tenders don’t meet the basic requirements and are therefore deemed ineligible from the word “go”. In order to position your entity to get tenders it is important to play by these rules:
Rule 1: Make sure your business is registered, either as a sole proprietorship, partnership, limited company or a cooperative. You can learn more about registering your company on this article.
Rule 2: Obtain a PIN and tax compliance exemption certificate for the business from the Kenya Revenue Authority (KRA). For more information about this you can visit the KRA website.
Rule 3: It is important to obtain requisite certifications from professional bodies and authorities. For instance, if you’re physically disabled, you may need to obtain
requisite certification from the National Council for Persons with Disability.
To further increase your chances of winning a tender, you can also register with the government’s online portal through www.agpo.go.ke. Alternatively, you can visit your county headquarters to register your entity.
(3) Not meeting ownership requirement threshold
At least 70% of ownership of your company must comprise of youth. Moreover, the company’s leadership must comprise 100% youth, women or persons with disabilities. If this requirement is not met, then your company will not qualify for the 30% tender pie.
Make sure you analyze the structure of your enterprise, to make sure it meets this requirement.
Remember, if you’ve been applying for several months without succeeding – and you are not satisfied with the outcome of the procurement proceeding, you may lodge your complaint with to the Director General of the Public Procurement Oversight Authority (PPOA).
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