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How much does it really cost to work through the bid or RFP process?
A 2024 study by the National Cooperative Procurement Partners (NCPP) broke it down, including the time and personnel resources to issue and manage solicitations, including:
Research showed that on average, it took 77.4 hours for complex projects and 15 hours for non-complex projects. Based on average salaries for procurement teams, NCCP estimates complex projects cost $17,419 to initiate, award, and manage.
The NCPP RFP Tracking Project also cites a separate tracking done by the Orange County, California, procurement team, which showed even higher numbers. They estimated the costs for an RFP process for a five-year contract totaled more than $86,000.
While your numbers may be far different from the numbers in these studies, there’s no question that procurement remains time-intensive and expensive. With today’s budget pressures, cooperative purchasing organizations become an even more attractive alternative for schools to maximize value and reduce costs.
For K–12 and higher education, the financial impact of cooperative purchasing organizations can be significant.
Financial and procurement teams can take advantage of pricing that has been negotiated on behalf of multiple organizations, resulting in lower prices than a single institution could secure on its own.
Procurement costs are lower as well because cooperative purchasing organizations enable you to streamline procurement, providing access to contracts that meet local, state, and federal purchasing requirements. This allows institutions to shorten the RFP process and focus on fulfilling your needs.
When time and resources are stretched thin, cooperative purchasing organizations provide a fast track to source the goods and services you need. Procurement teams can tap into pre-negotiated contracts, eliminating much of the legwork traditionally associated with the bid or RFP process. This allows your team to focus on other critical tasks.
Another key benefit of cooperative purchasing organizations is access to a broader range of suppliers, providing a connection with suppliers that otherwise might not respond to your RFPs. This can help you meet diversity and sustainability goals more easily with competitive bids.
Cooperative purchasing organizations also have built-in compliance and transparency. For schools that are required to adhere to strict regulations regarding spending and procurement, cooperative purchasing organizations provide peace of mind by ensuring that all contracts are thoroughly vetted. This reduces the risk of non-compliance and simplifies the audit process, which can be especially important for institutions that are regularly reviewed by external agencies.
Leveraging cooperative purchasing organizations is one way for procurement professionals to distinguish themselves in their field. With increasing pressure on schools at every level to demonstrate fiscal responsibility, procurement teams that can maximize value while minimizing costs will stand out. Utilizing cooperative purchasing organizations allows you to demonstrate your ability to deliver cost-effective solutions without sacrificing quality or compliance.
You’ll also save on your most precious commodity: time. By streamlining procurement with cooperative contracts, you can focus on more strategic tasks and cultivating relationships with suppliers. Working with a cooperative purchasing organization, you get access to a network of vetted suppliers who have demonstrated their reliability. Building strong relationships can produce customized solutions and long-term savings—delivering even greater value. Additionally, working with a cooperative can help you enhance your revenue generation with incentives and rebates.
For procurement professionals looking to stand out in their field, mastering the use of cooperative purchasing organizations is key. By streamlining procurement, fostering supplier relationships, and reducing costs, you can demonstrate your ability to add value to your institution. In an increasingly competitive landscape, the ability to deliver cost-effective, high-quality solutions can position you as a leader in your institution.
When you work with E&I Cooperative Services, there’s an added bonus. E&I Cooperative Services is the only non-profit, member-owned purchasing cooperative that focuses solely on the education sector. This creates more tailored solutions that fit the academic environment. Deep experience and category specialists provide access and guidance to find the right fit for your school.
As a member-owned cooperative, E&I members comprise procurement and financial teams working in the education sector. Members are active in guiding the organization and making decisions. You can benefit from the collective knowledge of your peers. As a non-profit, E&I Cooperative Services also returns proceeds to its 6,000 members in the form of patronage rebates based on volume at the end of each year.
Become a member of E&I Cooperative Services today. There is no cost to become a member and no minimum purchasing obligation.
