Preferential Procurement

The Preferential Procurement Element is designed to encourage the procurement of goods and services from BEE certified suppliers across 6 categories of suppliers:

• All suppliers.
• QSEs suppliers
• EMEs suppliers.
• 51% black owned suppliers.
• 35% black female owned suppliers.
• 51% black owned Designated Groups Suppliers (bonus)

There is an increased focus on procuring from black owned and black women owned businesses and professional services providers in order to increase the participation of these businesses in the main stream economy,

In relation to the Preferential Procurement Element, the Codes seek to ascertain the BEE Status levels of the measured entity’s suppliers, because the more empowered your suppliers are, the more points the measured entity will earn on its scorecard.

From a practical perspective the Preferential Procurement element is amongst the most administratively intensive, as it requires collecting the BEE certificates of all suppliers and thereafter inputting all relevant data to calculate the score achieved under this element.

The Scorecard for the Preferential Procurement sub-element is as follows:

Priority Element

 

The Codes have defined the Preferential Procurement sub-element of Preferential Procurement and Supplier Development element as a Priority Element in terms of transformation imperative.

 

The Preferential Procurement sub-element has set a 40% subminimum of the points available

 

• 7.6 out of 19 points for contractors and 7.2 out of 18 points for BEPs

 

ie - Should the Entity not achieve the required 40% subminimum in relation to the Preferential Procurement sub-element subminimum target its B-BBEE Status will be discounted by 1 level.

 

Bonus Points are totally excluded from the determination of the sub-minimums targets. In addition it appears that any bonus points earned will not be regarded when determining if the measured entity has met the sub-minimum targets.

Total Measured Procurement Spend

Preferential Procurement Calculator

Preferential Procurement Scorecard

Supplier Development