When government departments and large businesses buy ICT services, price is not the only factor. B-BBEE status plays a significant role in who gets the contract — and how much recognition the buyer receives in return.
If you are procuring ICT services or supplying them, understanding B-BBEE Level 1 is not optional. It is central to how public sector and enterprise procurement work in South Africa today.
What Is B-BBEE?
B-BBEE stands for Broad-Based Black Economic Empowerment. It is a government policy designed to increase the economic participation of Black South Africans in the mainstream economy.
The policy is governed by the Broad-Based Black Economic Empowerment Act of 2003, as amended in 2013, and is given practical effect through Sector Codes and the Generic Codes of Good Practice.
Businesses are measured against a scorecard that covers several elements, including ownership, management control, skills development, enterprise and supplier development, and socio-economic development. Based on their score, they are assigned a B-BBEE level from Level 1 (the highest) to Level 8 (the lowest). A business that does not comply is classified as a non-compliant contributor.
What Does Level 1 Mean?
A B-BBEE Level 1 contributor has achieved the highest possible rating on the B-BBEE scorecard. To reach Level 1, a business must score at least 100 points across the measured elements.
For a business to be 100% Black-owned and classified as a Level 1 contributor, it must meet the ownership thresholds set out under the relevant codes. Companies with 100% Black ownership that also meet the Qualifying Small Enterprise (QSE) or Exempted Micro Enterprise (EME) thresholds are automatically recognised as Level 1 contributors.
ZongeTech is owned by Zonge Investments (PTY) Limited, a 100% Black-owned entity. This makes ZongeTech a B-BBEE Level 1 contributor.
Why Does B-BBEE Level Matter for Procurement?
When an organisation buys goods or services from a supplier, the supplier’s B-BBEE level determines how much procurement recognition the buyer receives.
This recognition is calculated using a B-BBEE procurement recognition multiplier. The higher the supplier’s B-BBEE level, the higher the recognition the buyer receives on their own B-BBEE scorecard under the Enterprise and Supplier Development element.
The multipliers work as follows.
- A Level 1 supplier gives the buyer 135% procurement recognition.
- A Level 2 supplier gives the buyer 125% procurement recognition.
- A Level 3 supplier gives the buyer 110% procurement recognition.
- A Level 4 supplier gives the buyer 100% procurement recognition.
- Levels 5 to 8 give progressively lower recognition.
- A non-compliant supplier gives the buyer 0% procurement recognition.
This means that spending R1,000,000 with a Level 1 supplier counts as R1,350,000 on your B-BBEE scorecard. The same spend with a non-compliant supplier counts as nothing.
Why This Matters for ICT Procurement Specifically
ICT procurement in South Africa — particularly in the public sector — involves significant spend. Government departments, state-owned enterprises, and large private sector businesses allocate substantial budgets to hardware, software, consulting, managed services, and system integration.
Because ICT spend is high, the B-BBEE level of your ICT suppliers has a meaningful impact on your own scorecard. Choosing Level 1 ICT suppliers over lower-rated ones can make a real difference to your enterprise and supplier development score.
For government departments, the Preferential Procurement Policy Framework Act (PPPFA) and its regulations further require that procurement decisions factor in B-BBEE status. In many tenders, a portion of the evaluation score is allocated to B-BBEE level. A Level 1 supplier will score the maximum available points in that portion of the evaluation.
For listed companies and large private sector businesses, the Generic Codes of Good Practice set minimum thresholds for preferential procurement. Failing to meet these thresholds can cause a company to drop a full B-BBEE level — even if it scores well on every other element.
In short, who you buy your ICT services from directly affects your B-BBEE standing.
Common Misconceptions About B-BBEE Procurement
“We just need to tick the B-BBEE box.” B-BBEE is a scored element of a larger framework. A weak procurement score can drag down your overall rating. It is not a compliance box — it is a performance measure.
“Any Black-owned supplier will do.” Not all Black-owned suppliers are Level 1. Ownership is one element of the scorecard, but a company’s overall score determines its level. Always ask for a valid B-BBEE certificate before committing to a supplier.
“Our spend is too small to matter.” Even moderate ICT spend with Level 1 suppliers adds up on your scorecard. The 135% recognition multiplier means that smart supplier selection has a real, measurable impact.
“B-BBEE certificates last forever.” They do not. B-BBEE certificates are typically valid for 12 months. Always verify that a supplier’s certificate is current. An expired certificate means no recognition.
What to Look for When Procuring ICT Services
Before awarding an ICT contract, verify the following.
- The supplier holds a valid, unexpired B-BBEE certificate issued by an accredited verification agency.
- The certificate confirms the supplier’s B-BBEE level clearly.
- The supplier’s ownership structure supports their stated level — particularly for Level 1 or Level 2 claims.
- The certificate covers the correct entity. Group structures can be complex. Make sure the entity you are contracting with is the one named on the certificate.
For government buyers, your supply chain management unit will have specific requirements around B-BBEE documentation. These must be met before a contract is awarded.
The Business Case for Choosing Level 1 ICT Suppliers
The numbers make a clear case. If your organisation needs to meet a preferential procurement target — and most do — then choosing Level 1 ICT suppliers is one of the most efficient ways to get there.
You are already spending money on ICT. Directing that spend towards Level 1 suppliers does not cost you more. It simply earns you more recognition for the money you are already committing.
For government departments, it also helps demonstrate compliance with transformation objectives — which are subject to audit and public scrutiny.
How ZongeTech Supports Your Procurement Goals
ZongeTech is a B-BBEE Level 1 contributor, owned by Zonge Investments (PTY) Limited — a 100% Black-owned entity registered in South Africa.
When you procure ICT strategy, governance, project management, or advisory services from ZongeTech, your organisation receives 135% B-BBEE procurement recognition. That is the maximum available under the current codes.
Beyond the scorecard benefit, you are working with a firm that has over 35 years of ICT delivery experience across South Africa’s government, telecommunications, and banking sectors. Our team is certified in PRINCE2, ITIL, TOGAF, and PMBOK — and we understand the regulatory and operational realities of doing business in the South African public sector.
Final Thought
B-BBEE Level 1 status is not just a badge. For ICT procurement, it is a practical advantage — for buyers who want maximum scorecard recognition, and for suppliers who want to win government and enterprise contracts.
If your organisation is looking for a Level 1 ICT partner that can also deliver on the work, ZongeTech is ready to talk.
