PPPFA Preference Points Explained: How Tenders Are Really Scored
How the 80/20 and 90/10 preference-point systems work under the PPPFA: how price points are calculated, how preference (B-BBEE / specific goals) points are awarded, and how to claim them on SBD 6.1.
The Preferential Procurement Policy Framework Act (PPPFA) decides how every government bid is scored. Understand it and you stop guessing why you lost — and start pricing to win on points, not just on rands.
Two systems: 80/20 and 90/10
For acquisitions up to R50 million, tenders use the 80/20 split: 80 points for price, 20 for preference. Above R50 million it is 90/10. Which one applies is stated in the tender.
How price points are calculated
Price is scored relative to the lowest acceptable bid, not on an absolute scale. The lowest bid gets the full price points (80 or 90); every other bid loses points in proportion to how much more expensive it is. So you are competing on the gap to the cheapest compliant bid — a few percent can cost several points.
How preference points are awarded
The remaining 20 (or 10) points go to the 'specific goals' the organ of state sets for that tender. In practice this is most often your B-BBEE contributor level, but under the 2022 Preferential Procurement Regulations buyers may set other or additional goals (local production, designated groups). You claim these points on form SBD 6.1 and attach proof. Always read the tender's preference schedule, because the specific goals can vary between tenders.
What this means for your bid
- Claim every preference point you qualify for on SBD 6.1 — leaving it blank scores you zero there
- A better B-BBEE level can beat a slightly cheaper competitor
- Do not price below cost to chase price points; the preference points may close the gap anyway
- Read each tender's specific goals — do not assume last tender's rules apply
Frequently asked questions
What is the 80/20 preference point system?+
For tenders up to R50 million, 80 points are scored on price and 20 on preference (specific goals, commonly your B-BBEE level). Above R50 million the split is 90/10.
How are tender price points calculated?+
Relative to the lowest acceptable bid: the cheapest compliant bid gets the full price points and others lose points in proportion to how much more they cost.
Where do I claim my preference points?+
On form SBD 6.1, where you state your B-BBEE status level and attach proof. Omitting it forfeits your preference points regardless of your actual level.
Did the 2022 PPPFA regulations change preference points?+
They gave organs of state more discretion to set 'specific goals' per tender. The 80/20 and 90/10 thresholds remain, but always check the specific goals stated in each tender's preference schedule.
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