Businesses Stand to lose B-BBEE Compliance with New Draft Codes – EconoBEE Newsletter – 16 October 2012

The new draft BEE codes proposed by the dti will alter the current points rating of most companies.

• A business that currently earns 65-75 points and is rated level 4, will drop to level 6 or 7 based on the new codes. As a result they will need to do additional work to earn more BEE points.
• Companies with a current level 8 rating, the lowest level which is between 30-39 points, will become non-compliant on the revised codes.
• Currently, to achieve level 6 (which is a rating better than level 8), 45-55 points are needed. Based on the new codes, that company could drop to a level 8 rating.
• Any drop in level is a significant drop which could impact the amount of business you are awarded.

The new codes will make it more difficult to maintain the current levels. It is expected that numerous companies will lose points and their ratings and will be downgraded or even become non-compliant.

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The revised B-BBEE codes offer excellent opportunities for small black owned businesses. Black owned businesses need to understand how they can take advantage of this. The revised codes are still in draft format, but if passed will give excellent benefits to black owned businesses.

The revised codes give different benefits to 100% black owned businesses and those that are more than 50% black owned. A small black owned business, that has an annual turnover of less than R10 million is regarded as an EME – exempt micro enterprise.

A 100% black owned EME is allocated a level 1 – the highest level available. This will be of great benefit for tendering for business, both government and private. An EME that is more than 50% black owned, but not 100% is allocated level 2. Any other EME is regarded as level 4 – also a good score which will assist in winning business as small businesses will be in high demand by larger companies.

How to obtain a valid BEE certificate? Contact us and we will help you.

The Revised Codes are out. The merged element Enterprise and Supplier Development has already been controversial and we haven’t even started using the new codes. Worth 40 points it is the most valuable aspect on the scorecard 5 points more than the previous codes. It is also a priority element meaning if you don’t comply with certain minimum targets your overall level could drop 2 levels.

Apart from the new element name and priority status, the recognition levels have been adjusted which immediately drops your score from in theory as high as level 3 to non-compliant.

Although the good news is that the revised codes are only drafts, the reality is that preparation needs to begin as soon as possible to avoid dropping a level or multiple levels as we are predicting.

Our annual BEE Procurement and Enterprise Development Conference held in November 2012 will now incorporate the future implications of the revised B-BBEE Codes! Book early and qualify for our early bird special.

Instead of getting frustrated at verification agencies, join us for an informative full day course and let us show you how to improve your BEE status. During the course we will show you tips and tricks to earn more points without spending massive amounts of administration time. Help you implement small projects to gather supplier data faster all while avoiding the dreaded fronting certificate.

Quite simply the BEE Procurement and Enterprise Development conference will give you:

• The tools to effectively manage BEE Procurement and Enterprise Development
• The knowledge to perfectly execute BEE Procurement and Enterprise Development and gain 35 BEE points (on the generic scorecard) to secure the next tender
• More time to spend on other business activities
  

Book early for our BEE Procurement and Enterprise Development conference and receive a complementary license of EconoBEE V3 worth R3 500 (payment must be made two weeks before your attendance to qualify). 10% discount for 3 or more delegates from the same company.

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