Business Skills and Compliance Key to Success of Small Contractors
BYLINE: sarah-jane bosch
There is a frightening disconnect between the hundreds of emerging contractors and the long list of unplaced tenders piling up on the desks of government departments and construction major contractors, says Caron Whitfield of the National Prospecting Team, Alexander Forbes Risk Services.
"A relatively simple process of education and compliance can make the difference between the success or failure of small contractors," she says.
"After all, sub-contracting to emerging contractors should make sense. The Sasols, Murray & Robertses and City Powers of this world meet their BEE requirements by appointing emerging sub-contractors. Industry majors, as in any other economy, get to outsource smaller, more onerous or repetitive jobs that don't demand their full range of expertise, to industry juniors - creating an efficient chain of referral and specialisation.
"But in South Africa the history of construction majors sub-contracting to juniors hasn't been a happy one. Given all the horror stories, we were forced to look at both ends of the industry with quite a critical eye."
Whitfield and her team discovered that emerging contractors don't suffer from a shortage of skills or technical know-how.
Instead, their stumbling block is a lack of understanding of the legislative and business dynamics prevailing in the construction industry. Legislative hurdles, including the tendering process, are a minefield for emerging contractors.
l Registering in terms of the Compensation for Occupational Injuries and Diseases Act (COID) and meeting its demands.
l Having adequate construction insurance in place.
l Being able to meet the skills and training requirements that tender documents required.
l Understanding and meeting legislative requirements on a range of issues - from fire safety to equipment standards. …