Armscor going as far as being product specific in tender documentation is not out of the ordinary when these are destined for “scientific research” according to James Kerr of Orion Consulting.
He was referring to a recent Armscor tender seeking a REMUS unmanned underwater vehicle (UUV) for its Institute of Maritime Technology (IMT) in Simon’s Town. The tender (R&D/IMT-2023/018R&D/IMT-2023/018) was questioned by a potential bidder on the grounds Armscor “has an established preferred supplier/agent”. This because a specific product name is given in documentation and it is US manufactured.
He or she notes further in correspondence with Armscor’s Procurement Secretariat, the US-based OEM (original equipment manufacturer) “introduces other parameters of difficulty for acquisition, unless Armscor has a pre-arrangement for supply”. The Armscor Procurement Secretariat: Research and Development, has it “non-adherence, by proposing an alternative, as this potential bidder has requested, would nullify their compliance adherence”.
Kerr maintains IMT can specify specific products in the name of scientific research. “Gerotek, Alkantpan and other research entities in Armscor use the same approach for specialised equipment as does the CSIR, so this is not out of the norm for the country.”
Others in the local defence industry, who preferred anonymity, are of the opinion the challenge facing Armscor on the UUV tender will be to find three compliant products for evaluation, and drafting relevant tender documentation.
“There are probably companies willing to put a mark-up on off-the-shelf products to meet tender requirements,” one said, adding “the short response timeline more than likely indicates the requirement would have been known by a select few companies beforehand”.
“This could be an opportunity for a BBBEE Level 2 company to make 10% mark-up on a R50 million plus system if the OEM also submits a solution. Even more mark-up if the OEM does not submit a bid. Not bad for filling in a few forms,” he noted wryly.