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If you work in higher education procurement, you know the challenges all too well: greater budget constraints, fewer resources, rising prices, and intense pressure to be cost-effective. To manage this increasing workload and budget challenges, more colleges and universities are turning to national purchasing cooperatives to streamline procurement and save money.
A national purchasing cooperative enables members to pool their buying power to secure better pricing and terms for goods and services. These cooperatives operate across various industries, including education, healthcare, and government.
Purchasing cooperatives and group purchasing organizations (GPO) work collaboratively, helping members pool resources to achieve economies of scale they likely couldn’t achieve on their own. By negotiating contracts with suppliers on behalf of their members, they aggregate purchasing power to achieve higher volumes of discounts and greater incentives.
Some cooperatives require a membership fee, have minimum purchase requirements, or require you to use certain vendors. Others, like E&I Cooperative Services, do not. With E&I, the only requirement is that you are in the education sector. There is no membership fee, no minimum purchase requirement, and no restrictions on buying. Because E&I Cooperative Services is a nonprofit organization that exists solely to benefit its academic institution members, it also provides patronage refunds to members annually based on spending levels.
Cooperative purchases are transactions made through a cooperative purchasing organization. Cooperative contracts allow members to benefit from collective buying power. Some cooperative contracts also allow for customization. For example, contracts may establish baseline pricing with additional incentives for higher volume. Other contracts may enable you to designate supplier diversity or local subcontractors to fulfill the contract.
In education, there are significant compliance concerns. Between local, state, and federal regulations on procurement, grant restrictions and specifications, and institutional initiatives, cooperative purchases must align with all of these. Cooperative purchasing agreements are vetted to comply with legal, transparent, and ethical guidelines.
Cooperatives are not unique to the education sector. For example, REI operates as a consumer cooperative, sharing proceeds with members. Land O’Lakes is a farmer-owned co-op that works on behalf of rural communities and distributes dairy products like cheese and butter.
Other examples include:
These cooperatives benefit buyers and sellers by enabling members to share resources. For sellers, they provide collective bargaining strength and access to broader markets. For buyers, cooperatives generally result in lower prices and more streamlined negotiations.
Whether you are considering a GPO or a cooperative, you will benefit from working with an organization that focuses on education. For example, E&I Cooperative Services has extensive insight into the unique needs of its 6,000+ member institutions. This provides significant expertise that allows better sourcing, solicitation, and awarding of cooperative contracts that benefit higher education.
Category expertise in the wide range of procurement needs for colleges and universities also helps meet the growing challenges schools are facing these days.
Cooperative contracts cover a wide range of school needs, including:
View hundreds of cooperative contracts at E&I.
Partnering with a group purchasing organization that serves the needs of higher education can produce significant benefits. Here are some of the biggest benefits colleges and universities see when working with a GPO.
Cost reduction remains the biggest benefit for most colleges and universities. Combining the purchasing power of multiple institutions, members see discounted pricing. These savings also extend beyond just the purchasing price. Minimizing the amount of time needed to source and solicit vendors and manage contracts significantly lowers the administrative overhead and workload for finance and procurement teams.
Higher education institutions are inherently diverse, with procurement needs spanning everything from research equipment and student housing furnishings to dining services and energy solutions. GPOs cater to this diversity by offering flexible, customizable agreements that allow institutions to purchase only what they need.
This flexibility ensures you can benefit from volume purchasing, whether you’re a small college or a large university and whether you need commodity purchases for everyday items or niche items for your school.
Cooperative purchasing promotes transparency and accountability. This is especially important for public institutions, which regularly face scrutiny over how funds are spent. The same applies to private institutions as well, providing insight into pricing, selection, and contract terms.
The right GPO can help you with:
Membership in a GPO fosters a sense of community among procurement professionals and finance teams. When you partner with a cooperative purchasing network, you gain access to shared knowledge and resources, including:
Cooperative contracts also allow academic institutions to work more collaboratively with suppliers by developing long-term relationships. This often leads to innovative solutions and more targeted goods and services.
Higher education constantly evolves. Staying on top of technological advancements, sustainability practices, diversity initiatives, and industry standards is crucial. GPOs actively monitor these trends, ensuring that their members benefit from access to cutting-edge solutions.
An education-focused cooperative also stays current on industry developments. For example, it can be challenging to stay ahead of new developments, especially in technology. However, cooperatives work closely with a broad variety of suppliers to ensure you get access to emerging goods and services.
Some cooperatives provide tools for you to streamline your procurement and purchasing, such as eProcurement platforms linked to your financial systems. E&I Cooperative Services, for example, has a no-cost P-card marketplace that enables you to bring about 90% of your purchasing spend under contract and maximize contract offering through catalogs of approved suppliers and goods.
Another good example of how partnering with an education-focused cooperative can help is the recent challenges in Title IX administration. Based on member feedback, E&I Cooperative Services was able to procure cooperative agreements with several top Title IX consulting firms to help schools ensure they stayed current with their policies and procedures.
Cooperative purchasing organizations do not replace procurement teams but act as an extension, providing expertise and resources. This helps take the pressure off procurement and financial teams, providing solutions to common problems that go beyond just pricing. For example, support might include:
A university seeking to improve its IT infrastructure might rely on a GPO’s expertise to identify reliable suppliers, negotiate favorable terms, and implement scalable solutions. For example, you could get access to new AI tools by analyzing how such tools work in an academic environment.
One significant benefit of working with E&I Cooperative Services is a no-cost Strategic Spend Assessment (SSA). E&I analysts provide a strategic, consultative approach to help you identify spending efficiencies. By examining high-level spend data, E&I can find areas where your portfolio aligns with cooperative contracts to find potential savings. SSAs can also find opportunities to bring more spend under contract and consolidate suppliers for greater discounts.
The benefits of GPOs benefit your college or university in a variety of ways beyond just purchasing. For example:
This holistic approach ensures that GPOs support the broader institutional mission, fostering operational excellence across your campus.
Navigating procurement regulations is challenging even for experienced procurement and finance teams. GPOs help mitigate risks by making sure that vendor contracts comply with federal and state laws, including procurement standards under the Uniform Guidance for federal funding and policies promoting supplier diversity and ethical labor practices.
By reducing the risk of non-compliance, GPOs allow you to focus on your core educational objectives and reduce your worries about legal compliance.
The right educational cooperative is your strategic partner. Cooperative contracts create stronger vendor relationships, enabling institutions to influence product offerings, advocate for tailored services, and build trust across the supply chain.
One significant benefit of working with a cooperative organization is that suppliers have a vested interest in maintaining great relationships. Cooperative contracts represent a big piece of business for suppliers, so they are highly incentivized to deliver high-quality goods and services and be accountable to member institutions.
Group purchasing organizations play a pivotal role in higher education institutions, offering financial savings, operational efficiencies, and strategic support. By leveraging the collective power of GPOs, colleges and universities can meet the long list of demands in an increasingly challenging environment.
What is another term for co-op purchasing?
Co-op purchasing goes by several names. You might hear it called group purchasing, joint purchasing, or collaborative procurement. These terms all share the same goal, which is to pool resourcing and collective buying power to achieve better pricing and terms.
What is an example of a cooperative?
An example of a cooperative is E&I Cooperative Services, the only non-profit member-owned organization that focuses exclusively on the education sector.
What does co-op mean in education?
Co-op in education can mean a couple of things. It generally refers to cooperative education, which combines academic learning with real-world experience. In procurement, a co-op is a cooperative purchasing organization that allows multiple schools to combine demand to achieve volume pricing discounts.
Can small schools benefit from GPOs?
While schools of all sizes can benefit from a GPO, cooperatives are especially valuable for small schools. Cooperative contracts provide pricing that schools likely could not achieve on their own. In addition, colleges and universities have access to a broader range of goods and services from suppliers that might not otherwise respond to individual RFPs.
Learn more about how E&I Cooperative Services can benefit your college or university. Call (877) 693-2634 or email us at membership@eandi.org to discuss your procurement needs.
