To their credit, school district leaders can be creative in how they fund and spend their budgets to get the most out of every dollar. One savings area they sometimes overlook is cooperative purchasing — many times because of misconceptions. When used effectively, cooperative purchasing is a tool to simplify the buying process. Cooperative purchasing organizations help districts streamline procurement and save on the soft costs associated with RFPs and awarding contracts.
To help decide if a cooperative is the way to go, district purchasing officers should ask several questions:
Is my district legally able to use a cooperative purchasing vehicle?
Which contract vehicle will offer my district the best solution?
When does it make sense to purchase through a cooperative versus issuing my own RFP?
Does it make sense for my district to manage its own bid when there is not a lot of ROI?
These questions help establish the basic framework for a district’s work with a cooperative, and group purchasing organizations such as the National Joint Powers Alliance (NJPA) and The Cooperative Purchasing Network (TCPN) can help districts answer these critical items. Let’s look at several misconceptions that can make K-12 districts apprehensive to use this type of contract:
Misconception No. 1: It’s more efficient and cost effective if I do the contracting myself. At first glance, managing contracts internally may appear to be a cost-effective solution; however, the behind-the-scenes costs associated with the bidding process and long-term contract management may make working with a cooperative more affordable. It can be easy to focus solely on the hard upfront costs of the products and services and overlook soft costs, such as employee time and the effort required to fulfill state mandates and regulations. In the end, districts can miss the true cost picture.
On the other hand, cooperatives, such as NJPA and TCPN, streamline the RFP process, and their subject-matter experts manage multiple contacts, while satisfying each contract’s requirements for the purchasing officers.
In fact, cooperatives offer hard and soft cost savings, no matter the size of the customer. Smaller districts, for example, do not necessarily have the buying power of a large district and may not have the leverage to negotiate the same price on a product or service.
While larger K-12 districts have the buying power, they can still benefit from cooperative purchasing because cooperatives can protect districts and ensure that vendors will deliver on their promises.
Misconception No. 2: If I choose to use a cooperative purchasing vehicle, I will sidestep my state contract vehicles. In reality, groups such as NJPA and TCPN ensure districts are compliant with state and local regulations. The cooperatives walk districts step by step through the applicable statutes and how each is satisfied. This transparency and commitment to detail assure the purchasing officer the cooperative is handling bids correctly.
Misconception No. 3: National contracting agencies will overlook critical, community-specific details. Purchasing cooperatives have the resources to investigate every line of every bid to make sure it is in compliance with local regulations and beneficial to the community. NJPA, for example, provides a legal paper trail that publicly documents each step of the RFP process.
Cooperative purchasing is about making the RFP and award process easier and more efficient to save valuable effort and budget dollars. Purchasing officers still have to do their homework and ensure that they are informed and taking advantage of the most competitive agreement available to them. However, when used appropriately, cooperative purchasing vehicles save significant time and money.
Cooperative purchasing frees staff time and resources, while providing peace of mind and increasing both accuracy and efficiency in the bidding and contract management process.
Tara Barbieri is director of program sales at CDW-G, provider of technology solutions for government and education.