Vehicle recovery deal praised

21 May 2008
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22 May 2008

A buyer for the Metropolitan Police Service (MPS) has won an award for overseeing an innovative procurement process.

Lee Kitchen, category consultant for the MPS, received a "head of department commendation" for reorganising a vehicle recovery and storage contract, which reduced administration costs and increased profits by more than £8 million. Vehicle recovery describes the removal of vehicles if they are suspected of being an accessory to a crime, involved in a traffic accident or breaking parking laws.

Kitchen divided London into nine lots and sourced directly from three recovery firms in each zone. The agreement broke the "monopoly" of the London Association of Vehicle Recovery Operators (LARO) - the body for vehicle recovery firms in London - which Kitchen said had previously "dictated contract terms" to the MPS.

Under the deal the new suppliers signed up to three-year contracts where they charge £70 on average for each recovery. The cost for an owner to collect their vehicle from storage can reach £165 and the MPS receives the difference as profit.

Kitchen also introduced a penalty and bonus scheme. If a vendor takes more than 20 minutes to collect a vehicle they pay 1 per cent of the £70 fee. Equally, if the contractor is faster than 20 minutes, the MPS pay them 1 per cent.

Kitchen said the deal had strengthened supplier relationships by helping them to understand the tendering processes. The MPS brought the vendors together in a meeting earlier this year to encourage them to support and co-operate with each other.

"The process has been very satisfying. Other forces in Essex and Hertfordshire have approached us to discover more.

"They are looking at it as a best-practice model that could create profit," Kitchen told SM.

SMmay2008

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