Cooperative purchasing contracts have become steadily more popular at the federal, state and local levels. However, many people either don’t know they exist or don’t understand the advantages of using them. A cooperative contract allows a group of buyers with a common interest to pool their buying power, so they can negotiate more favorable pricing on goods and services. This type of purchasing model is an important element of a company or municipality’s procurement strategy, because it empowers purchasing experts to be proactive.
By aggregating purchasing volume from various companies, each person’s purchasing power increases. Members of cooperative purchasing companies can combine specific commodities to obtain better pricing than they would have on their own. Cooperative contracts are especially valuable for small governments, because they benefit from the market share leveraged by larger government consumers.
To better illustrate how a cooperative contract can benefit an individual, imagine the following scenario: A business owner needs to order twenty chicken coops. They contact their local supplier for a quote, place the order, and pay the rate for twenty chicken coops. Now, if they had placed this order through a purchasing cooperative that is contracted with the same supplier, the pricing would be based on the potential spend of an entire membership ordering through that supplier. This makes the saving opportunities exponential.
The cooperative purchasing model is admired for more than just better prices; it’s also more convenient. When it comes to contract development, cooperative contracts can save a lot of time and effort. Rather than seeking quotes, bids or proposals and paying the associated administrative costs, customers simply select products from the cooperative contract catalog. By letting specialized contract writers and management prepare the contracts, governments can produce better contracts for higher quality goods and services.
ClearSpan is a proud member of the N.J.P.A (Nation Joint Powers Alliance,) a national public service agency that provides purchasing contracts under the Uniform Municipal Contracting Law. ClearSpan customers that are members of the N.J.P.A enjoy a bidding process that is either expedited or avoided altogether. Members can work more efficiently by choosing to work with suppliers from their extensive database.
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