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With continuing pressure to manage spending more effectively, it’s no surprise that Deloitte’s survey of procurement professionals showed a movement from focusing efforts on transactions to a more strategic approach to managing costs. Private companies are transforming the way they approach procurement to remain competitive and are increasingly turning to cooperative procurement programs.
Are you leveraging cooperative procurement contracts in your academic institution? A study by the National Institute of Governmental Purchasing (NIGP) revealed that cooperative purchasing can save up to 15% annually. Other studies have shown savings of up to 30%.
Cooperative procurement contracts available s through E&I Cooperative Services can help. E&I is the only nonprofit member-owned sourcing cooperative focused solely on education. This produces in-depth knowledge of the unique needs of school districts, colleges, and universities and helps craft cooperative procurement contracts with standardized terms, lower costs, and more favorable conditions for schools.
A cooperative procurement program offers a strategic solution to some of the biggest challenges in education today. By streamlining procurement and leveraging collective purchasing power, cooperative procurement contracts can help mitigate at least some of the financial impact schools are dealing with today.
When considering cooperative agreements, here are five key features to look for to maximize your benefit.
One of the most significant benefits of a cooperative procurement program is collective buying power. School districts, colleges, and universities can achieve economies of scale by combining demand with other academic institutions, producing:
A well-structured cooperative procurement contract includes comprehensive terms and conditions that clearly outline the details, such as:
By establishing a clear framework, both the purchasing organization and the vendor can align expectations and mitigate potential disputes.
Effective cooperative procurement contracts recognize the diverse needs of different organizations. Flexibility becomes crucial in accommodating varying institutional requirements. While a cooperative agreement will have standardized terms, procurement teams should have the ability to:
For example, different schools within a district and disciplines within a college or university can have varying requirements for technology or equipment. Their contracts should accommodate these differences while maintaining the core benefit.
A flexible and adaptable contract structure fosters a more beneficial and meaningful partnership between suppliers and schools. Such arrangements can often lead to innovative solutions that align with the needs of academic institutions.
A 2024 study by Deloitte showed that the cost of school supplies has risen nearly 25% since 2000. While that impacts the bottom line for parents and students, it also demonstrates the continuing challenge that academic institutions face in their purchasing. Not only are prices rising, but many schools have been forced to put needed spending on hold, pushing problems down the road.
Despite the number of high school graduates being expected to increase slightly next year, the National Center for Education Statistics (NCES) does not anticipate an increase in enrollment. While experts are softening their stance on an enrollment cliff, schools likely will not be able to depend on tuition to resolve their financial concerns.
So, cost control will be a primary concern for the foreseeable future.
A cooperative procurement program can help provide cost stability by locking in prices for set periods and a clear mechanism for potential price resets. Contracts should be transparent on price adjustments and provide more predictable budgeting forecasts.
Cooperative procurement contracts streamline purchasing by reducing administrative burdens and paperwork. Cooperative agreements enable schools to simplify their procurement workflow and decrease time-consuming processes.
With rising concerns about staff reductions, it is essential for schools to optimize their processes to improve efficiency. Despite the magnitude of the job, many schools are already dealing with smaller procurement or finance teams to handle purchasing.
Standardized terms across contracts can simplify both procurement and supplier management.
By ensuring these five features are included in your cooperative procurement contracts, you can optimize your procurement process and save time and money. Above all, you need to make sure any cooperative procurement program you work with aligns with your institution’s needs and goals.
See how E&I Cooperative Services can help you streamline your procurement process and overcome today’s challenges in education budgets.
