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Making Sense of Preferential Procurement

Aug 13 ,2019

                                                                       

 

Preferential Procurement makes up to 23% of your overall BEE Scorecard and forms part of the broader Enterprise Supplier Development (ESD) element.

Supporting compliant businesses and keeping track of your supplier database is key – after all, ESD makes up a staggering 40% of the BEE scorecard!

Supporting Compliant Businesses Yields Great Returns

By strategically analysing your partnerships and managing your supplier database, you position your business as a good corporate citizen who supports like-minded businesses whilst enjoying recognition under the Preferential Procurement element.

When dealing with large enterprises, the Procurement allocation is lower than that of the Generic Codes, and is as follows:

•  All suppliers – 4 points

•  QSE suppliers – 1 point

•  EME suppliers – 2 points

•  51% 'Black’-owned suppliers – 6 points

•  30% 'Black’ Women-owned suppliers – 2 points

Points to note:

As the industry go-to, BEE-Connex takes pride in cutting out the jargon and bringing you Hassle-free BEE. Here are a few interesting points to note under Preferential Procurement:

•  Procurement is calculated on purchases - not payments.

•  Verification agencies require a detailed ledger, supplier age analysis, trial balance and a detailed general ledger to ensure that the procurement spend provided corresponds with the Annual Financial Statements.

•  If a company fails to reach the sub-minimum targets set out above, they are automatically be discounted by 1 level.

•  The majority spend should be allocated to EMEs or QSEs with at least 51% black ownership and 30% black women ownership.

Sophisticated Software to Manage your Suppliers?

If you are struggling in this regard, then why not try an outsourced solution?

On the BEE-Connex app, and in addition to our broad range of general BEE service providers, you now have access to a leading supplier who can manage your procurement easily and efficiently thanks to state-of-the-art software.

Pin-point, track, plan and maximise the suppliers that your company makes use of. Work alongside a dedicated team of experts to strategically enhance your spend and bolster your recognition.

Benefits:

•  Tracking and managing procurement data.

•  Strategic analysis of existing supplier agreements to increase enhancement recognition.

•  Breaking down and reporting back on each aspect of spend.

•  Scorecard calculation customised to each sector.

Get connected with the perfect supplier and consultant to match your business needs.