The South African National Roads Agency SOC Ltd (Sanral) is empowering small businesses with a new contractual clause that requires big companies to partner with small companies when bidding for construction projects.
The joint venture (JV) condition was first introduced with the awarding of the two contracts for the rehabilitation of sections of the R573 Moloto Road, one of South Africa’s routes linking Gauteng, Mpumalanga and Limpopo provinces.
The contracts required big contractors to bid as JVs with smaller companies for the project.
According to Nontobeko Mathenjwa and Lawrence Chauke, Sanral Project Managers on Moloto, this is the first of its kind and took a lot of planning and consultation to get approval from Sanral.
“This is a Sanral initiative; we had no reference or prior experience of implementing this model. It was really exciting to practically develop words and phrases to incorporate into our procurement documentation. I’m glad that it’s working and opening up the industry to small businesses” said Lawrence and Nontobeko.
Putting it into practice
In the Limpopo section of the project, a contract was awarded to two partners, KPMM and Chauke Business Enterprise (CBE). On the Mpumalanga section a contract was awarded to a JV between four companies, Raubex Construction, Themolo Business Enterprise, Khuluphala Tradings and Biz Afrika.
Commenting on the initiative Kevin Padayachee, Operational Director for KPMM, said they are happy to take on emerging companies, but these companies will have to play ball and make use of the opportunities presented. “That means no compromise on quality and reliability, so it’s important to attract the right partners for the JV,” he added.
Commenting on the opportunity available to small companies Adam Chauke, owner and managing member of CBE said: “It’s truly remarkable because it opens up the industry and affords us the opportunity to grow. Through the JV we are able to benefit from the mentorship and shared resources.”
From the experienced gained on the project, the SMMEs will be able to grow their grading at the Construction Industry Development Board (CIDB) and compete for bigger contracts in future.
Sanral will continue to introduce this initiative for all other projects going forward.