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Tight budgets and bigger workloads it may not be the best way to work, but it has become more than the norm at academic institutions. Rising costs, decreased staff, and an increased emphasis on cost control are turning an already challenging job into a nearly overwhelming experience for many procurement teams.
With the pressure to reduce costs, procurement teams are often forced to focus more on transactions than relationships. Yet, building instituion-supplier relationships is key to long-term success and optimizing purchasing power.
In this article, we will explain the importance of developing cooperative relationships with suppliers and how they yield better outcomes. Let’s start by exploring what is a cooperative supplier relationship.
In cooperative relationships, procurement teams and suppliers work together to find solutions that benefit both parties. By implementing a cooperative approach, schools can realize significant benefits, changing the dynamic of suppliers. In turn, this produces a more vested interest for suppliers to work closely with schools.
For example, suppliers that have good working relationships with institutions are more likely to:
When a supplier truly understands your goals and needs, it creates a level of interaction that simple buyer-seller relationships do not. This creates shared goals and produces longer-term relationships.
There are significant benefits for suppliers as well. A McKinsey study shows that suppliers that work collaboratively with buyers show as much as twice the growth as their competitors. Those innovating regularly with their partners see the most benefit.
Building this cooperative relationship requires a deeper level of transparency by both parties. It means meeting more regularly to discuss concerns, challenges, and initiatives. Open communication is key to finding areas where you can both benefit.
For example, a college or university might be open about their needs to meet sustainability goals in procurement. Knowing this, a supplier might be more likely to suggest alternative products that are more environmentally friendly and work with product teams for future development.
Similar discussions could help procurement teams with supplier diversity initiatives. Tier-1 suppliers who are aware of these goals can analyze their supply chain to ensure they meet your requirements, or they can look for alternate subcontractors that fit your needs.
However, none of this happens without investing in the relationship and active supplier relationship management. This is one area where partnering with an education cooperative can help.
A simple education purchasing cooperative definition would be an organization that enables schools to aggregate buying power to leverage volume discounts for better pricing and terms. Working with an educational cooperative can save you money, improve your purchasing power, and help you create more collaborative relationships.
E&I Cooperative Services is the only member-owned, nonprofit purchasing cooperative that exclusively serves the education sector. With over 6,000 school districts, colleges, and universities as members, E&I competitively solicits contracts that meet the unique needs of academic institutions. This provides significant purchasing power to lower costs while streamlining procurement.
While not all purchasing cooperative offer this benefit, a few education cooperatives such as E and I have members play an active role in goal-setting and procurement processes, ensuring they meet institutional guidelines and needs. The key is working together with suppliers to find win-win opportunities and develop mutually beneficial relationships. When you work with an educational cooperative, you also benefit from shared expertise and best practices. You get access to a broader range of resources and specialized suppliers who may not respond to RFPs for a single entity.
Because cooperative contracts represent multiple institutions, they have a higher value for suppliers, making them more willing to invest resources to work collaboratively. Suppliers know that if they consistently meet your needs, you are more likely to forge a long-term relationship. This creates significant economies of scale for suppliers, enabling them to pass savings on to you. At the same time, with a deeper understanding of your needs, suppliers can find additional ways to provide service.
All of this leads to better relationships and a more collaborative approach that benefits everyone.
Contact E&I Cooperative Services today to see how you can save time and money while developing stronger cooperative relationships with your key suppliers. Learn more about how we serve the education sector by calling 877.693.2634.
