While you're competing against established corporates for every tender, there's a parallel procurement universe where only small businesses can bid.
Government has committed to allocating 30% of procurement spend to SMMEs, women-owned businesses, and youth-owned enterprises. That's approximately R200 billion annually in contracts where your biggest competitors can't even submit a bid.
What Are Set-Aside Tenders?
Set-aside tenders (also called "designated group" tenders) are procurement opportunities restricted to specific categories of businesses:
1. EMEs (Exempt Micro Enterprises)
- Annual turnover under R10 million
- Automatic B-BBEE Level 4 status (or Level 1 with 100% black ownership)
2. QSEs (Qualifying Small Enterprises)
- Annual turnover between R10-50 million
- Measured on a simplified B-BBEE scorecard
3. Women-Owned Businesses
- At least 51% ownership by women
- Women in executive management positions
4. Youth-Owned Businesses
- At least 51% ownership by people under 35
- Increasingly prioritized in government procurement
Where to Find Set-Aside Opportunities
eTender Portal Filters
The government's eTender portal (etenders.gov.za) allows you to filter by "Designated Groups" or "Set-Aside" tender types.
Provincial Procurement Portals
Each province has additional set-aside programs—Gauteng has GEYODI, Western Cape has Supplier Development Programme, KwaZulu-Natal has Radical Economic Transformation procurement.
Municipal Opportunities
Municipalities are required to prioritize local SMMEs for contracts under R200,000.
The Real Advantages of Set-Aside Tenders
1. Dramatically Reduced Competition
A standard government tender might attract 50+ bidders. A set-aside tender for youth-owned EMEs in a specific province? Maybe 5-10 qualified bidders. Your odds of winning increase by 5-10x.
2. Relationship Building Opportunities
Set-aside programs often include mentorship from established contractors, payment within 15-30 days, and repeat business preferences.
3. Stepping Stone to Larger Contracts
Successfully delivering on set-aside contracts builds your track record for larger, open tenders.
How to Qualify for Set-Aside Tenders
Step 1: Get Your B-BBEE Status Right
Your B-BBEE certificate must clearly show your enterprise level, ownership demographics, and overall B-BBEE level.
Step 2: Register on All Relevant Databases
Beyond the Central Supplier Database (CSD), register on SEDA, NYDA, provincial supplier databases, and SOE supplier portals.
Step 3: Obtain Supporting Certifications
Strengthen your set-aside eligibility with affidavits of youth ownership, women-owned certification, and local content verification.
Common Set-Aside Mistakes to Avoid
Mistake #1: Not Actually Qualifying
You claim to be youth-owned, but your largest shareholder just turned 36. The verification date on your B-BBEE certificate is what matters.
Mistake #2: Misrepresenting Ownership
Fronting is a criminal offense. National Treasury actively investigates fronting, leading to blacklisting, personal liability, and criminal prosecution.
Mistake #3: Bidding Beyond Your Capacity
Winning a R5 million contract when you've never delivered R500,000 is a recipe for disaster.
Your Set-Aside Action Plan
This Week:
- Verify your B-BBEE status and ownership designations
- Register on CSD if not already done
- Set up eTender alerts for your categories
This Month:
- Register on 3+ provincial/municipal databases
- Obtain supporting certifications
- Identify 2-3 prime contractors for subcontracting opportunities
The opportunity is there. The competition is limited. Your designated group status is your competitive advantage. Use it.
