24 August 2006 | Paul Snell
A small number of vendors are dominating purchasing and e-procurement systems for local authorities, research has revealed.
A study from the Society of Information Technology Management analysed 353 UK councils' use of software applications, including general purchasing software and e-procurement tools.
Cedar OpenAccounts topped the chart for supplying purchasing and e-procurement tools. It has 16.3 per cent of the market share for the former, supplying 53 local authorities. It shares the top spot for e-procurement tools with Oracle. Each has 11.6 per cent of the market share and each supplies 20 local authorities.
Agresso, Civica (Powersolve), Oracle and Cedar OpenAccounts between them have around 40 per cent of the market for purchasing and e-procurement systems.
The report attributes their dominance to aggressive marketing and acquisitions, such as Civica's purchase of Radius computer services in 2004.
Brian Westcott, editor of the report, said the dominance of a few suppliers could benefit councils. "Many larger companies have good reputations for supplying quality software. Local authorities need to have confidence in their investment, in terms of reliability and support.
"If they use a less-established company they could be taking more of a risk."
The research also shows the use of in-house software is continuing to decline. Currently only 6.4 per cent of authorities use in-house purchasing systems compared with 7.7 per cent in 2005.