How National Procurement Systems Enhance, rather than Bypass, the Bid Process

Education procurement is complex. Tight budgets, evolving regulations, and changing requirements make the job of procurement teams challenging. Even for experienced pros, it can be confusing. Group purchasing organizations (GPOs) can help reduce frustration, but there are some misconceptions about how they work.

We will break down the process to give you a better understanding. Let’s start by defining what is a group purchasing organization for education and demonstrate how these national procurement systems enhance—rather than bypass—the competitive bidding process.

What Is a Group Purchasing Organization for Education?

A group purchasing organization combines the purchasing power of multiple educational institutions to negotiate better prices, terms, and conditions with suppliers. It serves as an intermediary between suppliers and academic institutions and handles the RFP, bid evaluation, and selection processes.

Cooperative contracts are made available to schools, that are part of the cooperative, across a wide range of suppliers. This reduces the administrative burden and workload for procurement teams while typically producing volume discounts that individual schools would not be able to achieve on their own.

Do National Procurement Systems Bypass the Bid Process?

There is a misconception that national procurement systems circumvent the traditional bidding process. Some school districts, colleges, or universities may worry that joining a GPO cedes control over selection and fails to comply with procurement laws and institutional requirements.

When partnering with a qualified GPO that has deep experience in the education sector, you can rest assured that it will follow all of the regulations regarding competitive solicitation and bidding. GPOs are designed to enhance, not replace, the competitive bidding process.

Rigorous Request for Proposal Process

GPOs have strict protocols to ensure compliance and transparency in their national procurement systems. These include:

• Needs Assessment: GPOs work with member institutions to identify common needs and requirements.
• RFP Development: A comprehensive RFP is created, incorporating member input and industry best practices.
• Supplier Solicitation: The RFP is widely distributed to ensure a diverse pool of qualified suppliers.
• Proposal Evaluation: Bids are thoroughly evaluated based on predetermined criteria, including price, quality, and service capabilities.
• Negotiation: GPOs leverage their collective buying power to negotiate optimal terms with selected suppliers.
• Contract Award: The final contract is awarded to the supplier offering the best overall value.
• Member Access: Participating institutions gain access to the negotiated contracts.

For each RFP, every step of the process is documented, providing transparency into the process and for audit purposes.

Meeting State and Federal Requirements

One of the key strengths of national procurement systems is their ability to navigate and comply with complex state and federal procurement regulations. GPOs invest significant resources in understanding and adhering to these requirements, which can vary widely across jurisdictions.

To meet these diverse mandates, GPOs:

• Employ experts familiar with procurement laws across different states
• Design their bidding processes to meet or exceed the most stringent requirements
• Provide detailed documentation of their procurement procedures for audit purposes
• Offer flexibility in their contracts to accommodate state-specific regulations

Enhancing the Bid Process

Far from bypassing the bid process, national procurement systems enhance it in several key ways:

• Streamlined Administration: By centralizing many aspects of procurement, you can reduce the administrative burden at your academic institution.
• Increased Purchasing Power: The collective buying power of members generally results in more favorable pricing and terms than you could achieve on your own.
• Access to Expertise: Procurement and category specialists bring in-depth knowledge of market trends, pricing benchmarks, and negotiation strategies.
• Broader Access: National procurement systems often have relationships with a wide range of suppliers, including small and diverse suppliers, which you might not discover on your own.
• Risk Mitigation: By leveraging cooperative contracts, you reduce the risk of non-compliance with procurement regulations.

With a thorough understanding of the rules and requirements, GPOs can standardize procurement procedures, applying them consistently across different categories. This structure enhances the bidding process and provides the framework for compliance.

Cooperative contracts can also be adapted to meet the flexible needs or differences in institutional policies. For example, suppliers may include price ceilings but offer additional incentives depending on spend levels. You may also get a percentage discount on any products you choose, allowing you to make independent decisions to meet specific goals, such as a percentage of purchases that are sustainable goods.

Achieve Better Procurement Outcomes

By partnering with the right GPO and understanding its process, you can leverage its commitment to fair competition and regulatory compliance to achieve better outcomes for your school.

E&I Cooperative Service is the only member-owned non-profit organization that works solely in the education sector. Its team of procurement experts and category specialists understands the uniqueness of education purchasing and helps craft RFPs to meet your objectives. With a strategic advisory board made up of member institutions, members guide the process to ensure your needs are met.

Unlike for-profit cooperatives, E&I Cooperative Services exists to meet member needs.

Contact E&I Cooperative Services or view available contracts.