Joint buying on the rise

3 September 2009

04 September 2009 | Allie Anderson

Over half of purchasers are looking to strike collaborative procurement deals in the next year, the latest SM poll reveals. Of the 100 buyers surveyed, 55 per cent said they were prepared to work with a competitor.

The need to cut costs during the economic downturn is fuelling the move towards joint working.

Martin Wakelin, purchasing manager at industrial group Trelleborg, sees collaborative procurement as "imperative to remain competitive, especially in the current climate".

Others said that greater buying power is key. David Smith, a former local authority procurement manager, points out: "You need to find a commodity that is common across several organisations, perhaps shared by a few common suppliers already."

One local council buyer said that joint purchasing has "become the norm" in the public sector as it drives savings to deliver a good service.

Recently, a buying consortium of nine London boroughs achieved significant savings and higher service levels when purchasing healthcare equipment.

Tim Weston, procurement and contracts manager at the London Borough of Camden, a member of the consortium, said that "harmonising requirements" is often problematic. "It's so much easier to just get on and do your own thing," he said.

A number of respondents with no joint buying plans said a lack of co-operation can be a barrier.

Neil Dixon, procurement manager at LeasePlan, said a "secret squirrel" nature means there is a reluctance to share information.

"Until a spirit of greater openness is taken, collaboration will remain a distant dream for many companies," he said. Christina De Luca, CPO for refining and marketing at BP, said consistency within an organisation must be achieved before looking to strike deals with other procurement functions externally.

SMsep2009

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