Collaborative purchasing – economies through scale
The purpose of “VIable procurement services” is to promote efficiency in the joint purchase of goods and services by harnessing economies through scale.
- Lower prices – Combining purchasing activities leads to economies of scale. This is likely to lead to more attractive offers from suppliers.
- Administrative cost savings – The total administrative work for preparing and carrying out one rather than several tenders can be substantially reduced.
- Skills and expertise – Joining the procurement membership also enables the pooling of different skills and expertise. Procurement (and other) skills are scarce and not every organisations has the time or the high quality skills across the full range of its functions.
- Jointly calls tenders, proposals and/or quotations for commonly-used items or by any other method agreed upon by the procurement members.
- Encourages standardisation of specification for commonly used items.
- Exchanges market information.
- Promotes closer co-operation, exchange of information on best practices, supply chain conditions, economic and regulatory conditions