Abstract
Background: The effectiveness of the bidding process for state-owned entities (SOEs) in South Africa is crucial for efficient resource allocation and service delivery. It is communal information and the government’s acknowledgement that the existing procurement practices used at SOEs are outdated and are confronted with countless difficulties, including conflicts of interest, corruption, fronting, theft, inflated prices, a lack of standardisation, ineffective processes, and a deficiency of suitable controls.
Aim: This case study investigates the bidding process in the Richards Bay Industrial Development Zone (RBIDZ) to assess its alignment with the principles of fairness, transparency, equitability, cost-effectiveness and a competitive bidding process outlined in Section 217 of the Constitution.
Setting: This setting relates to the bidding process in SOEs to align with the legislative framework to improve public sector performance and service delivery.
Methods: The study used a quantitative research design using a questionnaire with 25 key stakeholders.
Results: The findings signify the importance of effective communication, the value of briefing and debriefing sessions, and the need for alignment with international best practices to contribute to the effectiveness of the bidding process.
Conclusion: The research recommends integrating digital technologies, fostering stakeholder collaboration, and adhering to international best practices to enhance bidding processes in SOEs. It also advises policymakers to invest in digital infrastructure, bolster cybersecurity, offer stakeholder training, and develop a digital procurement framework.
Contribution: This empirical investigation contributes to an understanding of the role of the bidding process within the context of SOEs.
Keywords: bidding process; procurement; Richards Bay Industrial Development Zone (RBIDZ); state-owned entities (SOEs); supply chain management (SCM); South Africa.
Introduction
Public procurement plays a crucial role in the South African economy, with the government spending nearly R1 trillion annually on purchases, accounting for approximately 12% of the country’s gross domestic product (GDP) (Setino & Ambe 2016). State-owned entities (SOEs) are significant players in this procurement landscape and are responsible for acquiring vast quantities of goods and services to fulfil their two primary mandates: (1) promoting good governance and (2) addressing socio-economic concerns. Therefore, the effectiveness of their procurement processes, particularly the bidding process, is paramount to ensure efficient service delivery and optimal use of public resources (Manyathi 2019). Section 217 of the South African Constitution mandates that when organs of the state contract for goods or services, they must do so in a fair, equitable, transparent, competitive and cost-effective manner (Lyra et al. 2022). These principles form the foundation for public procurement practices across the country and serve as benchmarks against which the effectiveness of bidding processes can be evaluated (Anthony 2019).
The procurement landscape in South Africa has undergone significant changes since the end of apartheid (Mofokeng & Luke 2014). The implementation of the Preferential Procurement Policy Framework Act (PPPFA) in 2000 marked a shift towards using procurement as a tool for socio-economic development, mainly through the promotion of broad-based black economic empowerment (BBBEE) (Bolton 2006). This has added complexity to the procurement process, requiring SOEs to balance multiple objectives, including cost-effectiveness, fairness and socio-economic development. Despite these reforms, public procurement in South Africa continues to face challenges (Ambe & Badenhorst-Weiss 2012). Annual reports by the Auditor General of South Africa (AGSA) consistently highlight issues of irregular expenditure, non-compliance with procurement regulations and inadequate supply chain management (SCM) practices in SOEs (AGSA 2022). These challenges undermine public spending efficiency, adversely affect service delivery and erode public trust in state institutions (National Treasury 2015).
In South Africa, it is understood mainly that SCM in the public sector could be better, as there are endless accusations of corruption and inefficiency (Mazibuko 2017). The number of protests for service delivery also indicates that people do not receive the expected service quality they need because of ineffective procurement processes (Mofokeng & Luke 2014). These costs include waste of government resources, misrepresentation, and inferior quality of products and services (National Treasury 2015). Previous studies have established that entities and organisations that have been awarded contracts to supply SOEs with goods and services would attempt to recover their bribe payments through price increases, charging for services that were not delivered, failing to meet service performance standards, reducing service quality or employing substandard materials (Mathiba 2020). This leads to inflated prices and a reduction in quality, all of which significantly impact South Africa’s GDP (Mathiba 2020). The National Treasury (2015) stated that corruption in the bidding process results in a misstatement of government resources and poor and inadequate service delivery. Other indirect consequences include twisting of competition, restricted access to the marketplace and diminished business interest from potential bidders (Manyathi 2019).
A well-organised and innovative government SCM structure can help minimise these problems (Nkwanyana & Agbenyegah 2020). According to Section 217 of the Constitution, Munzhedzi (2016) posits that when SOEs contract for goods and services, they must align with the Five Pillars of Procurement, which include value-for-money, open and effective competition, ethics and fair dealings, accountability and reporting, and equity, upon which the entire SCM policy of effective and efficient public procurement is based. However, translating these principles into effective operational practices remains a challenge. Recent research by Nzimakwe (2023) identified significant barriers between procurement policy objectives and implementation outcomes in South African SOEs. This echoes the general agreement that public procurement is vulnerable to corruption, maladministration and mismanagement. Klaaren et al. (2022) proffer that addressing corruption requires a multifaceted approach, including strengthening legal frameworks, enhancing transparency and building capacity within procurement units.
The bidding process, a component of SCM, serves as a crucial mechanism to promote fairness, transparency and competition in public procurement processes while deterring supplier opportunism and bid protests (Hawkins et al. 2023). The bidding process is a crucial driver of service delivery, and unless it is performed well, service delivery will be negatively affected. This can include disrupted business operations, poor product production, delayed distribution, incorrect number of shipments, increased expenses and ultimately reduced customer service (Manyathi 2019). In South Africa, constitutional significance is assumed to be the determination of value for money, integrity in public sector procurement, public accountability and effectiveness (Nzimakwe 2023).
This study aims to assess the effectiveness of the bidding process in SOEs, using the Richards Bay Industrial Development Zone (RBIDZ) as a case study. Richards Bay Industrial Development Zone is a business estate linked to an international seaport that comprises several custom-controlled areas specifically designed for industrial and logistics purposes. Its primary objectives are to stimulate economic growth, investment, employment, and the development of the local workforce and skill set. There are 65 permanent employees, with total expenditure for the financial year 2023/2024 amounting to R246 million (RBIDZ Annual Report 2024). Some formal appeals have been lodged regarding the bidding process against the organisation (RBIDZ Annual Report 2022). In addition, there have been some audit findings on tenders awarded to incorrect bidders, which have caused severe delays in service delivery.
This pioneering research examines RBIDZ procurement practices to identify strengths, weaknesses and improvements for SOE bidding processes. It aims to improve public procurement in South Africa using empirical data that can guide policy and practical interventions, leading to more efficient use of resources, better service delivery and increased public trust in SOEs. The specific research questions that guide the study are:
- How effective is the RBIDZ bidding process in terms of fairness, equity, transparency, competitiveness and cost-effectiveness?
- What are the main challenges facing the RBIDZ bidding process?
- How can the bidding process in the RBIDZ be improved to enhance its effectiveness?
This study contributes to the literature on public procurement in South Africa and offers practical recommendations to improve SOE bidding processes. The article is organised as follows: the ‘Literature review’ section covers the related literature and theoretical framework, Section Research methods and design details the research methodology. Section ‘Results and discussion’ presents the results and discussion of the findings; Section ‘Conclusion’ provides a summary of the main findings, managerial and policy recommendations, addressing the limitations of the study and suggesting future research avenues.
Literature review
Background
In South Africa, SOEs are the country’s main buyers of goods and services (Mathiba 2020). According to recent estimates by the International Monetary Fund (IMF) (2023), public procurement expenditure in South Africa constituted 15% of the nation’s GDP during the 2021/2022 fiscal year. Local and provincial governments, along with public entities, which include major SOEs such as Eskom and Transnet, executed approximately 76% of public procurement activities, whereas the national government was responsible for the remaining 24% (IMF 2023). Given the billions of Rands spent on these goods and services, procurement should be integrated into strategic government efforts (Nzimakwe 2023). State-owned entities’ spending must be prioritised to increase efficiency so that funds are used appropriately while maintaining service delivery (Munzhedzi 2016). When used intelligently and effectively, government resources can be a powerful force to ensure that citizens receive basic services (Bolton 2006).
Previous studies have posited that SOEs misappropriate public funds during the bidding process to serve the interests of individuals (Lyra et al. 2022). This is attributed to the long-standing perception that mismanagement and corruption are rampant in the bidding process (Erasmus-Beyers et al. 2016). Such inefficiencies have led to an increase in allegations of fraud and corruption within bidding processes, adversely affecting service delivery intended for the development and welfare of citizens (Manyathi 2019). If these issues persist, progress in service delivery will be severely hampered, thus exacerbating the plight of the nation’s most vulnerable populations, which could culminate in significant public unrest (National Treasury 2015). Consequently, it is imperative for policymakers to improve procurement procedures within the South African public sector to ensure national sustainability and self-sufficiency, thus supporting the state’s developmental goals.
Public procurement in South Africa
Public procurement in SOEs comprises several phases, including identifying the goods or services to be acquired, lobbying and evaluating bid proposals, making an award, and ultimately the establishment of a valid and legal contract (Ambe 2016). Procurement constitutes a fundamental element of SCM and fulfils a strategic function in guaranteeing the availability of raw materials, goods and various components as necessary (Nzimakwe 2023). The acquisition of goods and services by any SOE is mandated to occur through a competitive bidding process. It is imperative that appropriate measures are established to ensure the procurement and receipt of these goods at an appropriate and cost-effective price, while simultaneously ensuring that potential service providers are afforded a fair chance to compete for contracts on the grounds of fairness and equitability. Therefore, the establishment and maintenance of supplier relationships play a critical role in procurement management, ensuring that organisational objectives are met (Nzimakwe 2023). For the effective functioning of SOEs, it is imperative that goods are purchased in the right quality, in the right quantity, at the right price, from the right supplier and distributed to the correct location (Setino & Ambe 2016).
Legislative framework governing public procurement
Public procurement in South Africa is regulated by an intricate framework of legislative measures and regulatory provisions, in which the Constitution functions as an overarching directive (Munzhedzi 2016). This framework includes several critical pieces of legislation (Nzimakwe 2023). The Public Finance Management Act (PFMA) of 1999 provides for the use of procurement as a policy tool and emphasises the principles of fairness, equity, transparency, competitiveness and cost-effectiveness (Munzhedzi 2016). The PPPFA of 2000 provides for the implementation of preferential procurement policies, particularly in support of historically disadvantaged individuals and small, medium and micro enterprises (SMMEs) (Bolton 2006).
Other relevant legislation influencing government and SCM include the BBBBBEE Act of 2003, the Construction Industry Development Board (CIDB) Act 38 of 2000, the Preferential Procurement Framework Regulations of 2001 and the National Treasury Regulations of 2005 (Setino & Ambe 2016). More recently, the Public Procurement Bill Act 28 of 2024 was enacted and serves to create a single framework to regulate public procurement, including preferential procurement for all organs of the state (Republic of South Africa [RSA] 2023). This framework promotes the use of technology for efficiency and effectiveness and enhances transparency and integrity to combat corruption (RSA 2023).
The bidding process
The bidding process is a crucial component of public procurement and is designed to ensure fair competition and value for money. The National Treasury (2015) emphasises the importance of clear evaluation criteria and transparent processes in effective bidding. The process typically involves several stages, including invitations to tenders, briefing sessions, submission and receipt of bids, evaluation and award. Specific regulations and internal controls govern the bidding process in the RBIDZ and comprise several distinct phases, which are illustrated in Figure 1 and elaborated on in detail in this section.
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FIGURE 1: Richards Bay Industrial Development Zone bidding process map. |
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The RBIDZ bidding process is a comprehensive procedure that involves multiple stages and critical players, all working together to ensure a fair, transparent and effective procurement system. The process begins with a request for an invitation to tenders (Phase 1), where the Bid Specification Committee, in collaboration with the SCM Unit and the end user, prepares bidding specifications and compiles bidding documents. Once approved by the Bid Adjudication Committee (BAC), these invitations are published on various platforms, including the Government Gazette, National Newspapers, the eTender publication portal and the CIDB iTender.
The call for the tender stage (Phase 2) follows, in which potential suppliers are invited to submit their proposals. This stage may include a briefing session (Phase 3), which can be compulsory or non-compulsory, providing clarity on tender requirements, and answering questions from potential bidders. Supply chain management personnel are crucial in facilitating this process, ensuring compliance with all relevant regulations and providing advisory support to bidding committee members (Ambe 2016).
Submission and receipt of tenders (Phase 4) is a critical phase in which bidders submit sealed proposals by the stipulated deadline. The Accounting Officer, typically the Chief Executive Officer of RBIDZ, bears the ultimate responsibility for the integrity of this process, as mandated by the PFMA. The Chief Financial Officer (CFO) oversees the financial aspects and ensures that proper internal controls are in place. Following the submission deadline, the opening of bidding documents (Phase 5) occurs publicly, with bidders’ names read aloud to ensure transparency. The evaluation of tenders (Phase 6) is then conducted by the Bid Evaluation Committee (BEC), which evaluates the submitted bids based on predetermined criteria, typically including functionality, price and preference points (Migiro & Ambe 2008). The evaluation of the bids is critical in this process. The PPPFA prescribes a preference point system, allocating points for prices and specific goals (such as promoting BBBEE). This system aims to balance the objectives of cost-effectiveness and socio-economic development (Bolton 2006). However, Ambe and Badenhorst-Weiss (2012) argue that the complexity of this system can lead to challenges in implementation and manipulation.
The BEC’s recommendations are then passed to the BAC for final decision-making on awarding the tender (Phase 7), where the successful bidder is notified via a letter of appointment and a debriefing session (Phase 8) for unsuccessful bidders (Kovács 2004). This last step, while non-compulsory, is designed to provide feedback and assist bidders in preparing more competitive proposals in the future, thereby enhancing the overall quality of the bidding process (Hawkins et al. 2023). Procurement teams view debriefings as a primary mechanism to allay bidder concerns regarding the illegitimacy of selection decisions and to mitigate the cost risks associated with the receipt of a bid protest. However, there are substantial differences in how debriefings are conducted and in the quality of the information provided (Arena, Azzone & Mapelli 2018).
Throughout this process, consultants can be called upon to provide expert knowledge in particular fields, providing insight to bid committee members, especially regarding technical evaluations. However, like SCM personnel, they play only an advisory role and do not have decision-making authority. The RBIDZ bidding process emphasises the importance of maintaining the integrity of this process, requiring all members of the tender committee to declare that they will not communicate about the tender processes with anyone outside of their specific committee. This policy and the structured roles of various respondents aim to uphold the constitutional principles of fairness, equity, transparency, competitiveness and cost-effectiveness in public procurement at the RBIDZ (Lyra et al. 2022).
Challenges in state-owned entities’ procurement
Ambe and Badenhorst-Weiss (2012) identified several challenges in SOE procurement processes, including limited skills and knowledge in public procurement, non-compliance with SCM policies and regulations, unethical practices and the ineffectiveness of the BBBEE policy. Setino and Ambe (2016) corroborated that many public sector procurement professionals lack the necessary skills and knowledge to effectively implement complex regulations. This skill gap can lead to inefficiencies, non-compliance and vulnerability to manipulation of the procurement process (Nzimakwe 2023).
Non-compliance with SCM policies, laws and regulations leads to substantial irregular expenditures, as proclaimed by the AGSA (2022), which has consistently maintained that it is evident from the PFMA that authorities and accounting officers bear the responsibility for preventing irregular expenditures. However, numerous SOEs have failed to adhere to applicable laws, and it has become apparent that the government’s response to corruption in public procurement has been insufficient (Klaaren et al. 2022). Furthermore, Mazibuko (2017) notes that manual procurement processes and siloed work contribute to systemic inefficiencies.
In a similar vein, Woods and Mantzaris (2012) identified a comprehensive array of factors that contribute to unethical practices in public procurement, including poor transparency, weak internal control systems, incompetent officials, conflicts of interest among decision-makers, urgent tenders with abbreviated vetting procedures, weak accountability arrangements and ineffective internal monitoring mechanisms. These institutional weaknesses create opportunities for various forms of corruption to flourish. There is no universally accepted definition of corruption does not exist; however, the definitions of the World Bank and Transparency International (TI) have particularly influenced practice. The World Bank (2020) defines corruption as the ‘abuse of public office for private gain’. Similarly, TI (2025) characterises corruption as ‘the abuse of entrusted power for private gain’.
Unethical practices manifest in several forms, perpetrated by the procurement function, suppliers or through collusion (Woods & Mantzaris 2012). Financial misconduct involves bribery, kickback schemes, embezzlement, false invoices, extortion, fraud and payments for goods or services that are not received (Morris 2011). Procedural manipulation arises from invoice cheating, price fixing, bid rigging, overpayments and inflated pricing (Woods & Mantzaris 2012). Favouritism and nepotism are reflected through patronage systems where public sector jobs or benefits are illegally channelled to family and friends or to benefit the decision-maker’s interests (Morris 2011). Munkuli et al. (2025) describe ‘fronting’ as the deliberate manipulation of information to bypass BBBBBEE processes, leading to widespread nepotism and fraud.
Fraudulent business practices include using shell companies, having ghost suppliers on the ‘preferred suppliers list’, paying ‘facilitation fees’ and authorising unnecessary purchases (Morris 2011). Political interference (Manyathi & Jarbhadhan 2024) and lack of accountability (Van Staden, Fourie & Holtzhausen 2022) impact public procurement governance in SOEs (Matsiliza 2024). Consequently, Van Staden et al. (2022) warn that without the enforcement of serious actions and consequence management by the South African government on individuals who do not comply with SCM legislation, irregular, fruitless and wasteful expenditures will continue to rise and further constrain sustainable economic development.
Opportunities in state-owned entities’ procurement
Digital transformation offers a strategic response to these challenges by providing a digitalisation platform that automates key procurement activities, including electronic design, electronic procurement, electronic evaluation and electronic contracting (Mojaki, Tuyikeze & Ndlovu 2025). State-owned entities can accelerate their procurement processes by modernising procurement practices and reducing corruption opportunities through the full implementation of e-procurement systems as a tool to improve transparency and efficiency in public procurement (Anthony 2019). State-owned entities in South Africa should transition to digital procurement (Manyathi & Jarbandhan 2024).
Nkwanyana and Agbenyegah (2020) highlighted the importance of automation and digital processing in modernising procurement practices and reducing corruption opportunities. A primary advantage of e-procurement lies in its ability to minimise direct human interaction, consequently mitigating the likelihood of unethical transactions between suppliers and procurement officials (Anthony 2019). Moreover, the expanded competitive landscape facilitated by e-procurement diminishes subjective biases in the allocation of contracts. Consequently, e-procurement systems have been identified as essential tools to attenuate fraud and corruption risks in both private sector entities and public institutions (Shibambu 2024).
Mojaki et al. (2025) recommend using the Internet of things (IoT) and cloud computing with sustainable public procurement and SCM to improve process efficiency in public procurement. Shibambu (2024) identified four Industry 4.0 technologies that can automate procurement procedures and improve compliance, cost efficiency, transparency and accountability. Using smart contracts, blockchain technology can provide a secure and immutable transaction record, reduce the risk of fraud and corruption, and improve supplier relationships by ensuring timely payments and fostering trust (Sibanda, Basheka & Van Romburgh 2024).
Artificial intelligence (AI) can automate routine administrative tasks and activities, such as data entry and contract management, thereby reducing human intervention and the risk of errors (Mojaki et al. 2025). Machine learning can improve strategic sourcing and robotic process automation can automate repetitive tasks such as invoice processing and reduce turnaround times (Mojaki et al. 2025). Furthermore, big data analytics can provide insight into procurement data, enabling data-driven decision-making (Shibambu 2024). Finally, SOEs should invest in IT infrastructure, and cybersecurity measures to leverage the full benefits of digital procurement (Nalubega & Uwizeyimana 2024).
Theoretical framework
The complexity of public procurement in SOEs is grounded in agency theory developed by Meckling and Jensen (1976), which illuminates the complex relationships and incentive structures inherent in public procurement processes. The theory addresses the challenges faced when principals delegate authority to agents whose interests may not perfectly align. In SOE procurement, multiple principal–agent relationships exist simultaneously between taxpayers and government officials, government departments, SOE management, and SOE procurement officers and suppliers. Matsiliza (2024) argues that these layered relationships create unique challenges for monitoring and accountability in public procurement, particularly in developing economies where institutional oversight mechanisms may be less robust.
Research methods and design
Research design
The study employed a positivist research philosophy, seeking to acquire objective knowledge conducive to establishing cause-effect relationships. The quantitative phase implemented a cross-sectional research design, involving the selection of a subset of the population engaged in the RBIDZ bidding process (Zikmund et al. 2010). Dacha and Juma (2018) successfully applied this methodology in their investigation of the impact of stakeholder participation on the efficiency of the procurement process in a public university.
Population and sampling
The study population included RBIDZ SCM personnel, bidding committee members, consultants, bidders and provincial treasury auditors. A stratified random sampling method was used to ensure a proportionate representation of the various subgroups involved in the RBIDZ bidding process. The total sample size was 25, as shown in Table A1 (see Online Appendix 1). Previous research on public procurement practices in government entities in South Africa and Kenya used a similar research approach with comparable sample sizes. For example, Mofokeng and Luke (2014) conducted a quantitative study on public entity procurement practices using a 5% sample (24 respondents) of Gauteng CFOs. Van Staden et al. (2022) developed a procurement accountability framework with a mixed-method approach, interviewing five executive managers in Limpopo. Dacha and Juma (2018) tested the effect of stakeholder participation on procurement efficiency in Kenya with a sample size of 48 employees. Their study also used a questionnaire as a research instrument, and data were analysed using quantitative methods.
These studies argue that public sector entities use similar procurement procedures; therefore, the limited sample size of 25 respondents was deemed appropriate because of the homogeneous population (Zikmund et al. 2010). However, this sample size suggests that the results indicate procurement practices within public entities but are not representative. Although aiming for comprehensive insights, the research is limited by data availability and generalisability to other contexts. Abt et al. (2020) state that sample robustness depends more on careful respondent selection than size. Therefore, despite the limited sample, the findings are justified by the exploratory nature of the study, the focus on a single organisation, and the need to protect respondents’ privacy and prevent harm.
Data collection method
Primary data were collected through a survey and a questionnaire was developed from the existing literature to serve as a research instrument designed to measure various aspects of the bidding process. The questionnaire included sections on demographics, invitations to tenders, briefing sessions, submission and receiving process, closing date and opening of tenders, evaluation process and award of tenders. Responses were measured on a 5-point Likert scale ranging from 1 (strongly disagree) to 5 (strongly agree).
Data analysis
Quantitative data from questionnaires were analysed using IBM SPSS version 29.0. Descriptive statistics, including means and standard deviations (SD), were calculated for each item (Zikmund et al. 2010). Frequency distributions help to analyse categorical data such as demographics and close-ended questions. The reliability and internal consistency of the questionnaire were evaluated with Cronbach’s alpha; coefficients greater than 0.7 were considered acceptable, and more than 0.8 indicated good reliability (Tavakol & Dennick 2011).
Two multiple regression analyses using Pearson’s correlation coefficient (r) examined the association between the dependent variable and several independent variables (Zikmund et al. 2010). These analyses quantified linear relationships between two continuous variables, with correlation coefficients from -1 to +1, facilitating hypothesis testing related to research questions in Section Results and findings. Assumptions for multiple regression, including linearity, error independence, homoscedasticity, normality of residuals and absence of multicollinearity, were assessed. The models’ statistical significance (F-statistic) and predictors (t-statistic) determined hypothesis outcomes, with 0.05 as the significance threshold. The analyses used 95% confidence intervals.
Exploratory factor analysis (EFA) was used to identify relationships among variables, reducing them into fewer factors. Principal component analysis (PCA) with Varimax rotation clarified key dimensions in the bidding process. The Kaiser-Meyer-Olkin (KMO) measure and Bartlett’s test of sphericity checked the suitability of the data set for factor analysis.
Ethical considerations
The study received ethical approval from the Johannesburg Business School’s Research Department (Ethical clearance number: JBSREC2023139). The RBIDZ Supply Chain Manager granted permission. Respondents gave their informed consent in writing, ensuring voluntary participation, anonymity and confidentiality. Publicly available RBIDZ documents, including financial statements and AGSA audit reports, are available on the RBIDZ website and linked to government sites for the collection of legal data.
Results
Descriptive statistics
The study sample of 25 respondents (N = 25) involved in the RBIDZ bidding process is reflected in Table A2 (see Online Appendix 1) and illustrated that 72% were under 45 years of age, with 40% aged 36 years – 45 years and 32% aged 26 years – 35 years. The gender distribution was relatively balanced, with 56% women and 44% men. The racial composition included 56% African, 24% Indian and 20% white, indicating diversity.
Study results and discussion of findings per section of the bidding process
Invitation of tenders
The results in Table A3 (see Online Appendix 1) show a generally positive perception of the invitation process. All items (IT1–IT6) have a mean greater than 4, indicating strong agreement. IT6 (The advert states clearly where completed bid documents and proposals may be delivered) has 100% of the respondents strongly agreeing (mean = 4.80; SD = 0.408), suggesting that this aspect is particularly well handled. The lowest mean is for IT3 (the RBIDZ advertises on a CIDB iTender, inviting potential tenderers to bid for work) at 4.08 (SD = 0.862), although still indicating 76% overall agreement. Manyathi, Burger and Moritmer (2021) reinforce this finding by stating that the advertisement of bids is an aspect of the briefing process that is followed correctly in government entities.
Briefing session
Table A4 (see Online Appendix 1) shows all aspects of the briefing session are rated highly, with means from 4.36 to 4.64. The top-rated aspects, BS3, BS5 and BS6, all scored 4.64, highlighting clear communication, attendance tracking and document verification. BS2 has the highest SD (0.918), indicating varied opinions on excluding those who miss the mandatory briefing session. This finding is not surprising, as SOE briefing sessions are easy to communicate and follow (Manyathi 2019).
Submission and receiving process
Table A5 (see Online Appendix 1) indicates that there is more variability in this section. SRP1 (The RBIDZ bidding process is in accordance with internationally accepted best practices) and SRP2 (the location to submit the tender documents is very convenient and clearly stated) have lower means (3.64 and 3.76, respectively) and higher SD (1.036 and 1.300, respectively), indicating heterogeneous perceptions on the conformity of international best practices and the convenience of the submission location. This indicates that RBIDZ needs to understand internationally accepted best practices and apply international standards in its bidding process to be more effective and efficient. This finding is supported by Dube, Johannes and Lewis (2015) who assert that South African public procurement should adhere to international trading instruments and rules, with particular implementation of the World Trade Organisation (WTO) Plurilateral Procurement Agreement (GPA), which aligns with Section 217 of the Constitution.
Regarding the convenience of the submission location (SRP2), the findings indicate that certain potential bidders encounter challenges in submitting their tender documents because of the inconvenient location. Consequently, potential bidders may be dissuaded from engaging in the bidding process owing to the submission location’s lack of convenience. On the contrary, SRP3 (only documents received on time are accepted) and SRP4 (a tender register is made available to be signed when submitting the bid document) are rated very highly (means of 4.68 and 4.64), suggesting strong agreement on the punctuality of document acceptance and the availability of a tender register. This internal control at RBIDZ ensures that all submitted bids are recorded and no bids are accepted after the closing date.
Closing date and opening of tenders
The data in Table A6 (see Online Appendix 1) indicate very high agreement across all items, with means ranging from 4.52 to 4.88. CDOT1 (the closing date is always clearly stated in the bid document) and CDOT2 (the closing time is always stated as well) are particularly notable, with 88% and 84% strongly agreeing, respectively, indicating excellent clarity in communicating closing dates and times. The public opening process (CDOT3) and the public reading of bidders’ names (CDOT4) are also well regarded, although with slightly more neutral responses.
Evaluation process
Table A7 (see Online Appendix 1) shows the results for EP1–EP10, covering the evaluation process aspects such as fairness, integrity, transparency and specific evaluation criteria. All are positively rated with scores from 4.20 to 4.84. EP8 (evaluation based on functionality, price and preference) and EP9 (requirement for valid tax clearance) are highly rated at 4.84 and 4.80. EP5 (process promotes competitiveness) is the lowest at 4.20, but still positive.
Awarding of tenders
Table A8 (see Online Appendix 1) reflects that the notification of successful bidders (AT1) is very well-regarded, with a mean of 4.68% and 68% strongly agreeing. There is more variability in the notification of unsuccessful bidders (AT2), with a lower mean of 4.08 and a higher SD of 0.909, suggesting room for improvement in this area. This finding is supported by Hawkins et al. (2023), who found that providing feedback to unsuccessful bidders is a form of procedural justice and failure to do so may prompt bid protests. The communication of information about debriefing sessions (AT3) has been positively received, as indicated by a mean score of 4.44. However, these sessions are not compulsory, so there is variability in their implementation across SOEs (Erasmus-Beyers et al. 2016).
Debriefing session
Most (88%) of the respondents in Table A9 (see Online Appendix 1) indicated that it is necessary to conduct debriefing sessions, while 12% believe it is unnecessary. Few SOEs conduct debriefing sessions, and a question may arise: ‘Do debriefing sessions assist bidders in preparing better proposals in the future?’ In Table A10 (see Online Appendix 1), 84% of the respondents indicated that debriefing sessions do help bidders prepare better proposals in the future. These findings are consistent with Hawkins et al. (2023), who concluded that debriefing sessions help unsuccessful bidders improve their future offerings (Hawkins et al. 2023).
Reliability
Table 1 provides a clear overview of the reliability of each factor or constructs measured in the study. Most of the constructs demonstrated acceptable to excellent reliability (α > 0.7), with the closing date and the opening of the offers showing exceptionally high reliability (α = 0.980). However, some constructs, notably the Evaluation process (Factors 2 and 3) and Awarding of tenders, showed lower reliability, suggesting potential areas for improvement in the measurement scales.
Regression analysis
Two multiple regression analyses were performed to examine the relationship between different aspects of the bidding process at RBIDZ. In this study, the dependent variable is ‘Submission and receiving process’. The following hypotheses were formulated to determine their acceptance or rejection.
Model 1: Debriefing session impact
Hypotheses:
H1a: The necessity of the debriefing session significantly predicts the submission and receiving process.
H1b: The helpfulness of the debriefing session in preparing better bid documents significantly predicts the Submission and receiving process.
Overall model hypothesis:
H1c: The debriefing session factors (necessity and helpfulness) significantly predict the Submission and receiving process.
Table 2 and Table 3 present the regression model for Debriefing session impact and show that all hypotheses were rejected (H1a: Rejected (β = 0.087, t(22) = 0.218, p = 0.830); H1b: Rejected (β = -0.112, t(22) = -0.281, p = 0.781); H1c: Rejected (F(2, 22) = 0.040, p = 0.961, R2 = 0.004). Neither the necessity of the debriefing session nor its perceived helpfulness in preparing better bid documents significantly predicted the Submission and receiving process. The overall model was not statistically significant (p > 0.05). Neither of the independent variables contributes significantly to the model (p = 0.830 for the necessity for the debriefing session and p = 0.781 for the helpfulness of the debriefing session). The high variance inflation factor (VIF) value (3.520) for both independent variables indicates potential multicollinearity problems that are supported by the high correlation between these variables (r = 0.846, p < 0.001) shown in the correlation matrix. This suggests that these two variables measure similar aspects and may be redundant in the model. The result is notably unexpected given that 88% of respondents deemed debriefing sessions necessary, while 84% concurred that such sessions assist bidders in formulating improved proposals for future endeavours.
| TABLE 2: Model summary for debriefing session impact. |
| TABLE 3: Regression results for debriefing session impact. |
Despite its theoretical value, the current execution of RBIDZ debriefing sessions could be insufficient or inconsistent. This inadequacy could be attributed to the timing of the debriefings, which frequently take place after the finalisation of contract award decisions, and their optional status, which could reduce their efficacy. This finding is supported by previous research by Arena et al. (2018), which found that bidders characterised their debriefing experiences as occasionally insufficient, antagonistic, evasive and devoid of adequate responses to inquiries. Similarly, Erasmus-Beyers et al. (2016) agree that debriefing sessions are not consistently implemented across all public sector entities in South Africa, representing a missed opportunity to improve the procurement process. However, Hawkins et al. (2023) argued that debriefing sessions may have other benefits for unsuccessful bidders, including enhanced perceptions of procedural justice, reduced supplier opportunism, facilitated attributions to sales losses and implementation modifications to their competitive strategies when developing future offerings. These divergent findings highlight the complexity of bidding processes and represent a future research opportunity on the role of debriefings in future bids.
Table 4 and Table 5 present the regression model and results for the Briefing session impact, upon which the following hypotheses were formulated:
| TABLE 4: Model summary for briefing session impact. |
| TABLE 5: Regression results for briefing session impact. |
Model 2: Briefing session impact
Hypotheses:
H2a: Briefing session attendance significantly predicts the Submission and receiving process.
H2b: Briefing session communication significantly predicts the Submission and receiving process.
Overall model hypothesis:
H2c: The briefing session factors (attendance and communication) significantly predicted the Submission and receiving process.
The findings demonstrate that the factors associated with the briefing session serve as significant predictors of the Submission and receiving process, accounting for 50.9% of its variance. Briefing session communication (BSC) emerged as a significant predictor (p < 0.001), whereas Briefing session attendance (BSA) did not achieve statistical significance (p = 0.428). The low VIF values (1.003) suggest an absence of multicollinearity concerns, indicating that BSA and BSC assess distinct dimensions of the briefing session. The results of the hypothesis testing revealed that H2a was rejected (β = 0.121, t(22) = 0.807, p = 0.428), while H2b was accepted (β = 0.696, t(22) = 4.656, p < 0.001) and H2c was accepted (F(2, 22) = 11.425, p < 0.001, R2 = 0.509). These outcomes suggest that attendance alone does not significantly predict the Submission and receiving process; however, the effectiveness and quality of communication during the briefing session exert a significant impact. Acceptance of the overall model hypothesis (H2c) further supports the inference that the briefing session factors, collectively, significantly predicted the Submission and receiving process.
These findings are in concordance with previous research conducted by Forcada et al. (2017), who identified the quality of information, which encompasses both its accuracy and timeliness, as the paramount factor for bidders in public sector construction projects. This information serves as a precursor to the decision-making processes of prospective bidders for complex projects procured by SOEs. Manyathi (2019) contend that ineffective communication from the government regarding future procurement plans dissuades prospective bidders from assembling innovative and viable bids, primarily because of restrictive time constraints, as tender advertisements typically close within 21 days. This observation may elucidate why participating in briefing sessions does not enhance the submission and receipt process.
Correlation analysis
Pearson’s correlation analysis (r) was performed to examine the relationships between the key variables in the study. The results in Table 6 show several notable correlations.
Submission and receiving process
There was a strong positive correlation between BSC and the Submission and receiving process (r = 0.704, p < 0.01). This suggests that as the quality of communication during the briefing session improves, the effectiveness of the submission and receiving processes also increases significantly. Briefing session attendance showed a weak positive correlation with the Submission and receiving process (r = 0.162, p = 0.220), but this correlation was not statistically significant. Both the necessity (r = -0.008) and helpfulness (r = -0.039) of the debriefing session showed weak negative correlations with the Submission and receiving process, but these correlations were not statistically significant. The significant impact of communication quality parallels the findings of Forcada et al. (2017) who found that bidders prioritised the quality of information as an antecedent to successful bidding within construction projects.
Debriefing session
There was a strong positive correlation between the perceived necessity of the debriefing session and its perceived helpfulness in preparing better bid documents (r = 0.846, p < 0.01). This suggests that respondents who saw the debriefing session as necessary also tended to find it helpful for future bid preparation. These findings align with Hawkins et al. (2023) that debriefing quality influences supplier behaviour after a bidding experience.
Briefing session
There was a very weak positive correlation between BSA and BSC (r = 0.059, p = 0.390), but this correlation was not statistically significant. Hawkins et al. (2023) posit that by equipping session leaders with proficient communication techniques, disseminating precise and thorough information, and facilitating opportunities for participants to enquire and resolve ambiguities, the level of engagement during briefing sessions can be enhanced.
Table 7 summarises the key results of the EFA performed on the survey items to identify the underlying constructs related to the bidding process. The analysis revealed several key factors.
Invitation to tender (IT): Two factors explain 68.374% of the variance: The first (39.142%) is about platform-specific advertising and the second (29.232%) covers invitation details and timing.
Briefing session (BS): Three factors account for 73.592% of the variance: briefing sessions conduct (32.067%), attendance documentation (21.450%) and requirements (20.075%).
Submission, receipt and public opening (SRP): A single factor explains 48.969% of the variance, covering all the submission and opening aspects.
Closing date and opening time (CDOT): Two factors account for 87.973% of the variance. The first (50.270%) relates to public tender opening, and the second (37.703%) to closing date and time.
Evaluation process (EP): Four factors account for 72.829% of the variance: fairness and integrity of the evaluation (23.767%), criteria and process (16.939%), process documentation (16.482%), and transparency and competitiveness (15.641%).
Award and termination (AT): A single factor accounts for 52.637% of the variance in the notification to the bidder.
The KMO measure of sampling adequacy ranged from 0.507 to 0.657 across the constructs, indicating a mediocre to middling suitability for factor analysis. The Bartlett test of sphericity was significant (p < 0.05) for all constructs except AT, suggesting that the correlations between items were sufficiently significant for EFA.
Summary of findings
The first research question was designed to address the effectiveness of the RBIDZ bidding process in terms of fairness, equity, transparency, competitiveness and cost-effectiveness. The findings indicate that the RBIDZ bidding process generally exhibits effectiveness, demonstrating robust performance in areas such as invitations, briefing sessions, the evaluation process and the awarding of tenders. The process reflects adherence to the principles of fairness, transparency and compliance with regulatory requirements. The communication dimension of the briefing sessions emerges as a crucial determinant influencing the efficacy of the submission and receipt process.
The second research question was what are the main challenges facing the RBIDZ bidding process? The findings revealed that certain aspects require improvement, particularly regarding the efficiency of the evaluation process, the influence of debriefing sessions and the assurance that the process aligns with international best practices. The absence of a significant correlation between debriefing sessions and process effectiveness implies the need to re-evaluate the structure and implementation of these sessions.
Finally, the third research question was: How can the bidding process in the RBIDZ be improved to enhance its effectiveness? The following managerial and policy recommendations are provided to address this question that aligns with the study findings and is justified using existing literature to provide practical strategies for SOEs and policymakers to implement.
Managerial recommendations
Early stakeholder engagement
The quality of communication during the briefing session is the most crucial factor related to the effectiveness of the submission and receiving process. Based on this finding, the RBIDZ procurement function should prioritise early stakeholder engagement with structured but flexible communication strategies and support from the top management during the bidding process (Dacha & Juma 2018). Using the triadic stakeholder model developed by Holma et al. (2020), the RBIDZ should involve the procurement unit, prospective bidders and end users in the pre-tender phase, whereby a preliminary needs assessment is conducted through a joint ideation process. This approach ensures that all prospective bidders have meaningful participation in the tender process by understanding the tender requirements, which should include detailed specifications and evaluation criteria. Consequently, prospective bidders benefit by engaging in early dialogues so that they can submit legally and contractually compliant documents.
Tailored and inclusive communication
Given the linguistic diversity that extends beyond English and Afrikaans in South Africa and the cultural differences of prospective bidders (Khumalo, Ditsele & Rwodzi 2023), it is recommended that the RBIDZ briefing sessions accommodate a variety of languages, including translation services where practically possible, to foster an inclusive environment that honours the diverse backgrounds of all respondents, while ultimately encouraging submission. The latest generation of generative AI chatbots, such as ChatGPT and GrokAI, have translation services in all South African languages that offer nuanced cultural responses, which the RBIDZ could leverage in their bidding process.
Richards Bay Industrial Development Zone should consider tailoring their approach, offering more targeted briefing sessions for SMMEs, women and youth-owned businesses to encourage the submission of proposals. In addition, management should tailor communication channels for different types of bidders, including persons with disabilities by incorporating non-verbal communication strategies, such as visual aids, images and body language, to enhance understanding and engagement during briefing sessions. These recommendations can help convey complex information to various stakeholders.
Digital communication tools
Currently, RBIDZ employs limited digital tools, primarily using its website for tender advertisements and emails for certain communications, but relies predominantly on manual processes for bid submission, evaluation and contract management. Briefing sessions are held in person; however, debriefing sessions are conducted online using Microsoft Teams. This hybrid approach creates inefficiencies and inconsistencies in the procurement processes. Therefore, RBIDZ should leverage digital platforms such as mobile apps, chatbots and telephonic short message services (SMS) that can provide real-time updates and foster stakeholder engagement, consequently increasing the overall quality of communication during procurement processes (Shibambu 2025).
Practically, this includes generative AI chatbots embedded on the RBIDZ website during the bidding process to allow prospective bidders to ask questions and receive answers instantly, without human intervention. If the chatbot runs out of responses, the matter is escalated to the procurement team for further assistance (Shibambu 2025). This interface between humans and technologies is termed the Fifth Industrial Revolution (5IR). The South African Revenue Service has successfully implemented this solution, whereby technology can auto-file annual returns for taxpayers, and employees intervene only if there are objections (Shibambu 2025), thus making it easy for the RBIDZ to replicate in the bidding process.
Engaging and informative briefing sessions
Richards Bay Industrial Development Zone should focus on making the briefing sessions more engaging and informative than simply mandating attendance. This could involve interactive seminars using a digital collaboration platform to help manage documentation and share information equally among prospective bidders (Holma et al. 2020). Consequently, RBIDZ should develop and implement metrics to assess the effectiveness of communication throughout the bidding process. This could involve participant feedback or assessments of the quality and completeness of the submitted bids. This initiative can influence stakeholder participation in the bidding process (Dacha & Juma 2018).
Improving debriefing sessions
Given the importance of debriefing sessions, RBIDZ should develop comprehensive debriefing guidelines that ensure constructive feedback while maintaining confidentiality and adhering to ethical standards (Erasmus-Beyers et al. 2016). It is recommended that RBIDZ share the number of bids received, provide the ratings (or scores) of nonprice evaluation criteria of all bidders, explain why bidders receive the ratings and assist bidders to systematically collect and analyse their ratings and competitors’ ratings using AI to improve their bid strategy (Hawkins et al. 2023).
Strengthening governance and capacity building
Training bid committee members is also essential for enhancing the procurement process (Migiro & Ambe 2008). A well-structured training programme should cover various aspects, including the legal framework governing public sector SCM, ethical considerations and the intricacies of bid evaluation and adjudication. This investment in skill development is crucial for maintaining high standards of professional ethics and ensuring efficient resource utilisation. The introduction of ad hoc bid committees and the rotation of committee chairpersons can further contribute to efficiency and mitigate potential collusion risks (Klaaren et al. 2022).
Furthermore, public procurement mismanagement can be controlled by involving competent stakeholders in the procurement processes of the public sector. This may be through trade unions, community forums, representatives from key stakeholders and other advisers. The current public sector procurement necessitates the establishment of three bidding committees: one for drafting specifications, another for evaluating bids and a third for adjudicating and awarding contracts (Migiro & Ambe 2008). To improve adherence to the regulations and lessen unethical behaviour and corruption, stakeholders must be invited to be members of the bid evaluation and adjudications committees. This will build public confidence in the procurement process at the RBIDZ and create open governance (Matsiliza 2024).
Alignment with international guidelines and best practices
The RBIDZ should develop detailed specifications, transparent evaluation criteria and debriefing guidelines that conform to standardised structures recognised by the World Bank, the United Nations Commission on International Trade, the Federal Acquisition Federation and the WTO Plurilateral GPA which governs debriefings in public and international tenders (Kovács 2004). For example, the supplier debriefing guidelines employed by the Government of South Australia (2023) include an extensive supplier debriefing template that incorporates information that can be disclosed to unsuccessful bidders, including proposal rankings, without divulging proprietary information. Given that South Africa employs a procurement system comparable to Australia (Van Staden et al. 2022), RBIDZ can adapt this template to its requirements.
Policy recommendations
To further support these findings, governments, policymakers and legislators need to support the adoption of digital technologies in public sector procurement (Shibambu 2025). However, this is hindered by several barriers, including budgetary constraints and competing priorities for limited resources, insufficient IT infrastructure and connectivity issues in certain regions, limited digital literacy among both procurement staff and potential bidders, concerns about cybersecurity and data protection, and legislative challenges unresponsive to the disruptive and forever changing nature of new technologies (Mojaki et al. 2025). To mitigate these challenges and significantly improve the procurement process in SOEs, the following three main government interventions are recommended.
Investment in digital infrastructure and improve data and cybersecurity measures
The government should prioritise investments in network infrastructure to bridge the digital divide, ensuring that rural communities and historically disadvantaged individuals can participate in digital procurement systems (Mojaki et al. 2025). Security measures must be enhanced as Industry 4.0 technologies increase risks to SCM operations (Nalubega & Uwizeyimana 2024). The State Information Technology Agency should be empowered to address cyber threats (Mojaki et al. 2025).
Continued training
State-owned entities must implement ongoing training programmes to ensure procurement officials can operate effectively using new technologies (Shibambu 2025). Training should be extended to prospective bidders and end-users to enhance digital literacy. When stakeholders lack proper training, they often fail to follow procurement regulations, leading to improper disqualifications or contract awards, resulting in legal battles (Hawkins et al. 2023).
Develop a digital procurement framework
The government should develop a comprehensive digital procurement framework integrating IoT, cloud computing and Industry 4.0 technologies to enhance efficiency while maintaining compliance (Manyathi et al. 2021; Mojaki et al. 2025). Policymakers must expedite progressive legislative frameworks accommodating technological innovation while maintaining procurement principles, to align with the new Public Procurement Bill (Shibambu 2025). As a starting point, the Electronic Communications and Transactions Act 25 of 2002 should be updated to align with international best practices that incorporate transborder jurisdiction and enforcement of judgement, to support Fourth Industrial Revolution (4IR) and 5IR technologies (Shibambu 2025). This includes establishing ethical and governance boundaries over technology use (RSA 2023).
Limitations and future research
This study had limitations that may inspire future research. The sample of 25 respondents may not fully represent all stakeholders in the RBIDZ bidding process. Future research could include more stakeholders, including unsuccessful bidders who may have different perceptions of the fairness and transparency of the bidding process (Hawkins et al. 2023). The cross-sectional nature of the study provides insights at a specific point in time, and therefore, longitudinal research could assess long-term impacts on the bidding process. The focus on RBIDZ as a single case study limits the generalisability to other SOEs. Future research could compare bidding processes using a multi-case study approach to examine procurement processes across diverse SOEs for broader policy recommendations, as was recently employed by Manyathi and Jarbhadhan (2024).
Future studies should employ a mixed methods approach, combining quantitative surveys and qualitative interviews, to provide a deeper insight into systemic procurement challenges while acknowledging that, in the context of public procurement in South Africa, directives and legislation delimit the broader framework for interaction between procurement teams and bidders. Finally, future research could explore the role of public procurement as an innovation policy tool in South Africa to drive innovation and economic development. This can be explored using the private sector procurement model developed by Manyathi et al. (2021) to improve public sector performance and service delivery. Despite these limitations, this study is envisaged to act as a foundation to improve public sector procurement in SOEs and will be used by scholars to advance research in this domain.
Conclusion
This study evaluated the effectiveness of the bidding process at RBIDZ and identified strategies to improve procurement in South African SOEs. Through quantitative analysis of responses from key stakeholders (n = 25), this study revealed significant insights that contribute to theory and practice in public procurement. To the best of our knowledge, this is the first study in South Africa to present empirical insights into the effectiveness of the bidding process in SOEs.
Acknowledgements
The authors wish to thank Dr Teboho Moloi for his assistance with the statistical analysis. They also express gratitude to Ms. Sarah Louise Cornelius of Regcor Enterprises Pty Ltd for her initial language editing of the dissertation from which this article is derived. Finally, the authors thank Ms. Claire Harcourt-Cooke for her professional editing of the final article. This article is partially based on Lethukuthula S. Ngubane’s dissertation titled ‘Evaluating and assessing the effectiveness of the bidding process for state-owned entities’ towards the degree of Master of Business Administration in the Johannesburg Business School, University of Johannesburg, South Africa on 26 May 2025, with Mamekwa Katlego Kekana as the supervisor. It is available on request from the corresponding author.
Competing interests
The authors declare that they have no financial or personal relationships that may have inappropriately influenced them in writing this article.
Authors’ contributions
M.K.K. and L.S.N. equally contributed to conceptualisation, methodology, formal analysis, investigation, writing of the original draft, visualisation, project administration, software, validation, data curation, resource management, and review and editing of the article. M.K.K. also contributed to supervision. The corresponding author is M.K.K.
Funding information
This research received no specific grant from any funding agency in the public, commercial or not-for-profit sectors.
Data availability
The data that support the findings of this study are available from the corresponding author, M.K.K. upon reasonable request.
Disclaimer
The views and opinions expressed in this article are those of the authors and are the product of professional research. It does not necessarily reflect the official policy or position of any affiliated institution, funder, agency or that of the publisher. The authors are responsible for this article’s results, findings and content.
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