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Public procurement - state transport undertaking tenders
What it is
State Transport Undertakings run large bus fleets and procure retreading through tender, as do defence and police units. Contracts specify process, materials and often mileage warranties
Orders are periodic, documented and awarded on lowest evaluated price among technically qualified bidders
Impact on industries
- Delivers volume and revenue visibility that fragmented private fleet work cannot, and buses are 15-20% of the retreading market
- Technical qualification excludes the unorganised fringe, so tendered work is one of the few segments where compliance capability is rewarded
- L1 award caps margin - once qualified, the contract goes on price, so tender volume comes at the industry's lowest realisation
- Government payment cycles are slow, straining working capital, and mileage warranties transfer performance risk to the retreader