Product details

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Subject category: Entrepreneurship
Published by: Wits Business School - University of the Witwatersrand
Published in: 2003
Length: 15 pages
Data source: Field research

Abstract

The night before his tender proposal had to be submitted, Barry Berman, the founder of Creative Plates, a company that marketed personalised vehicle registration numbers (PRNs) in the Western Cape and Gauteng, was about to negotiate the biggest deal of his life. To stand a chance of winning a contract to market PRNs for the Gauteng provincial administration, his company had to meet government affirmative procurement requirements.This meant that he had to negotiate a deal with a black-owned company. Without this contract, the long-term viability of Creative Plates would be threatened. Across the table from him were Ramateu Monyokolo and Tlhalefang Sekano, both directors of the Letlapa Group, which had been specifically formed to take advantage of opportunities presented by government''s affirmative procurement policies. When Monyokolo stated Letlapa''s opening position as wanting a 50% share in the new company, Berman''s heart sank. He had started Creative Plates. He had put his life and soul into this business. He had anticipated giving the empowerment partner no more than a 25% share in the new company. How much of a share could he afford to give to Letlapa before it became unviable? How could they structure the relationship so that it worked in the future? He wondered even now if he could not have met the government''s affirmative procurement requirements in another way.
Location:
Industry:
Size:
Small
Other setting(s):
2000

About

Abstract

The night before his tender proposal had to be submitted, Barry Berman, the founder of Creative Plates, a company that marketed personalised vehicle registration numbers (PRNs) in the Western Cape and Gauteng, was about to negotiate the biggest deal of his life. To stand a chance of winning a contract to market PRNs for the Gauteng provincial administration, his company had to meet government affirmative procurement requirements.This meant that he had to negotiate a deal with a black-owned company. Without this contract, the long-term viability of Creative Plates would be threatened. Across the table from him were Ramateu Monyokolo and Tlhalefang Sekano, both directors of the Letlapa Group, which had been specifically formed to take advantage of opportunities presented by government''s affirmative procurement policies. When Monyokolo stated Letlapa''s opening position as wanting a 50% share in the new company, Berman''s heart sank. He had started Creative Plates. He had put his life and soul into this business. He had anticipated giving the empowerment partner no more than a 25% share in the new company. How much of a share could he afford to give to Letlapa before it became unviable? How could they structure the relationship so that it worked in the future? He wondered even now if he could not have met the government''s affirmative procurement requirements in another way.

Settings

Location:
Industry:
Size:
Small
Other setting(s):
2000

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