Decision checklist: Scoping
Decision checklist for scoping Yes No Comments
Mo6va6on: Government moXvaXons, goals and
Previous experience: ExisXng concessions? How
procured? Sustainability integrated? Human resources
A>rac6veness to investors: AestheXcs, market
demand, infrastructure, level of damage?
Legal framework: Management plan? Laws suﬃcient
for investment? Authority can re-invest revenues?
Poli6cal will: Ministerial support? Red-tape excessive?
Good governance? Financial support for process?
Design of the opportunity 3: Duration
Adapted from Spenceley et al, 2016 Table 3, and Thompson et al, 2014: Table 5.2
Type Length Examples
Concession 10-40 years AccommodaXon, restaurant, retail
Lease / management
5-30 years Fixed infrastructure: accommodaXon,
airport, restaurant, shop
License Up to 10 years Vehicle-based tours with operator
equipment (e.g. game drive, balloon trip)
Permit Up to 10 years AcXviXes like guiding, canoeing, hunXng
using operator equipment
VariaXon in length – for same product type – depending on level of capital investment
Viability and market assessment:
WBG Guideline, Spenceley et al, 2016;SADC guidelines: Spenceley 2014
Process: transparent, fair, consistent
• Supply-driven: Value proposed and offered by
• Market-driven: Unsolicited applications from investor
• Revenue-based: % of gross revenue of
concessionaire (e.g. with minimum payment)
• Per-unit fees: $ per hectare
When does the
start to pay fees?
Commercial viability for investors:
• Capital required
• Operating expenses (ﬁxed and variable costs)
• Break-even income for concessionaire: no. sales x rate
• Use of debt-ﬁnance (i.e. interest or not)
• Minimum fee that is affordable to the concessionaire
• Can a concessionaire afford the project?
• Is it affordable/a good investment over the concession
Adapted from PPP toolkit, South Africa
Value-for-money for authorities:
Adapted from WBG Guideline: Spenceley et al, 2016
Value-for-money for authorities: Time vs method
WBG Guideline: Spenceley et al, 2016 adapted from Thompson 2009
WBG Guideline: Spenceley et al, 2016, ciXng Thompson, 2008
Example: Beneﬁts to government, communities
and the private sector
High-level business plan:
• Goals and objectives
• Products and services to be developed
• Concession model: i.e. management, lease, Build-
• Business model: e.g. private sector, joint-venture,
• Industry and market analysis
• Development impact: $, jobs, protection, skills developed
• Sustainability plan: environmental, social, economic
• Project schedule: procurement process, duration, exit.
• Marketing plan
• Financial plan and projections + scenarios
• Critical risks and assumptions + mitigation plan.
• Monitoring and evaluation
Working groups: Design and feasibility
Group 1: Win-win deals
• Discuss how to ﬁnd the best deal - balancing
authority & investor ﬁnancial needs.
• List process the PA authority should use to ﬁnd a
win-win deal on fees in relation to the revenue the
investor may get.
Group 2: Choosing a concession model
• What criteria would you use to decide whether to
seek a private, NGO, community or joint-venture
• What are the costs and beneﬁts of each? (ﬁnancial,
environmental, social etc)
Working groups: Feasibility
Review the iSimangaliso case – 5 min
• Group 1: Value for Money Indicators
• Group 2: Preliminary Environmental
• Group 3: Preliminary Market Review
• Group 4: Risk Assessment
• Group 5: Stakeholder analysis