What is consortia purchasing

For example, Iowa State University may be invited to use them because the University of Iowa is a member. It should be noted that while group members are ABLE to purchase off of awarded contracts, they are not required to do so.

Like the BTAA, individual states will take the lead on specific solicitations and handle the entire procurement on behalf of the other members. Jodi Essex can be reached via jodir iastate. Did you know… What a Purchasing Consortium is? Did You Know? Increased compliance. Higher realized savings. Accelerated time to value. GEP relies on its extensive cadre of highly knowledgeable category experts who continually monitor and evaluate their markets, researching trends and reviewing price benchmarks gathered across a broad range of clients across various industries.

Through continual research and experience, the development of up-to-date supplier databases, pricing benchmarks and quality benchmarks, procurement service providers like GEP have a thorough understanding and knowledge of the spend category.

As a result, negotiations with suppliers focus on a comprehensive value equation and ultimately drive maximized value in any supplier negotiation.

We've seen numerous examples where the realized savings from consortium buying were significantly lower than the savings realized in cross-enterprise strategic sourcing, using implied leverage. This is true even in the case of office supplies, the quintessential commodity category. Think megavolumes brings higher savings on pens and paper? Think again. The CBM consolidated the spend of 20 individual companies, achieving a combined spend of eight times greater than the telecommunications firm alone.

The CBM identified pro forma savings of 30 percent on select products. At first, this seemed like a great deal. These prices, however, were tied to strict spend limits.

The telecommunications firm was also required to switch suppliers and absorb all switching costs. And some of these savings were contingent on hitting annual volume levels that were out of the company's control — and had not been met in the previous year. Still, in its initial stage, this was viewed as a great deal and it was indeed better than their original base line. But even better results were achieved through a strategic tendering process.

Here, GEP focused strictly on the client's very specific office supply requirements and the real contours of its spend. An experienced sourcing team led a robust competitive tendering process that evaluated multiple suppliers through multiple rounds of discussion and negotiations. Furthermore, these savings came from their incumbent supplier, eliminating all switching costs or operational risks associated with changing vendors. Additionally, the incumbent supplier agreed to even higher savings on specific paper and toner products not covered in the CBM but quite important to the client.

Furthermore, the sourcing efforts provided even greater value through a volume-based rebate structure that was tied solely to the client's historic volumes, and thus, were far more in the client's control and more likely to be achieved than those in the CBM deal. Let's re-cap what was achieved through 'Implied Leverage'. By focusing on the client's specific realworld requirements, and by leveraging deep market knowledge and strong price benchmarks, GEP achieved lower prices, better terms, with less risk, no costs and immediate cash flow benefits.

That, we submit, in dollars and cents is the power of rigorous strategic sourcing and 'Implied Leverage' provided by an expert procurement services provider. Consortia-based buying models can deliver significant savings benefits to small- and mid-sized companies. But large, global companies simply do not achieve the same gains. Non-compliance is endemic and creates enormous gaps between contracted and realized savings. Moreover, the inherent awkward nature of CBMs brings often unacceptable limitations on business agility and competitiveness.

In fact, CBMs foist a hornet's nest of strategic, operational and competitive issues onto large, global enterprises. What makes these potentially self-inflicted wounds worse is that they are entirely unnecessary. Procurement services providers provide the surest route not only to the best price but also the best value. Industry, category and market expertise, state-ofart tools and technology, relationships, resources, reputation, skilled staff on demand and at scale, optimized work process and proven methodologies — these are just some of the assets that enable procurement service providers to leverage the spend of large enterprise clients in the most efficient, effective ways possible.

Working with a procurement service provider, a large enterprise will realize both higher savings and best value. Without loss of visibility, relationship, understanding or control. Without sacrificing the confidence and satisfaction of internal clients. And without resignation to abysmal rates of compliance that render the consortium purchasing agreement functionally irrelevant.

By checking the box below, you consent to GEP using your personal information to send you thought leadership content — such as white papers, research reports, case studies — and other communications. GEP representatives may contact you to provide additional information or answer questions. Examples of some you might wish to consider are as follows. Nonprofit Purchasing.

Victoria-based, Nonprofit Sector Purchasing Power Pty Ltd was established for the specific purpose of providing a purchasing service for non profit organisations across Australia. It has a range of attractive contracts including those for fuel, telecommunications, office stationery and equipment, computer hardware and software, etc.

This is particularly useful if you have purchases for which it is hard to identify suitable suppliers or where you just want a professional body to benchmark your own sources.

A concessional annual subscription is offered to some organisations and most Nonprofit Purchasing contracts are also available for use by staff, volunteers and supporters on the same basis as for the agency itself. To enquire about becoming a subscriber, contact the company at 86 Finsbury Road, Devon Meadows, telephone 03 , or email to jodi npp.

Existing customers can access the service here. Buy Link Pty Ltd is a commercial buying consortium that uses its comprehensive electronic system to manage the procurement process for subscribers wishing to deal with the selected suppliers hosted on its site. Purchasers are required to pay an annual fee to access the site and favourable prices, convenience and levels of service are intended to justify the expenditure on membership.

Choice is somewhat restricted with each industry sector catered for in the service typically having one, or sometimes two, suppliers with whom subscribers can place orders. These suppliers pay Buylink a commission on all sales processed through the system.