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Educational and institutional cooperative purchasing using a purchasing cooperative enables you to leverage collective bargaining power for better pricing and streamlined procurement.
This process offers big benefits for schools, colleges, and universities, but suppliers see advantages as well. If we look at procurement from the suppliers’ perspective, we can see the many reasons working with purchasing cooperatives is beneficial for suppliers and why they result in savings for academic institutions.
Imagine being a salesperson at a large company tasked with getting business from schools. There are more than 100,000 public and private schools and 5,000+ colleges and universities in the U.S. Regardless of the size of your team and the territory you are assigned, you have a lot of ground to cover. Visiting each institution or school district website, sifting through various RFPs, and finding ones that fit your company’s goods or services is an immense undertaking.
Once you find a fit, you have to carefully craft your proposal to fit the RFP. You might start with a template, but every RFP has its unique requirements. Then, you have to track your submissions, follow up with questions, and stay in touch with the potential client.
You may have to do this for dozens or even hundreds of bids. It’s easy to miss deadlines, leave out important details, or make mistakes.
You can see why suppliers prefer to work with purchasing cooperatives, responding to fewer RFPs that have a broader reach—without the frustration of responding to individual RFPs. This streamlined approach alleviates the need for complex and resource-intensive sales and marketing efforts targeted at individual schools.
Educational and institutional cooperative purchasing aggregates the collective buying power of a larger number of schools. These contracts are more lucrative and can produce significant economies of scale in production and distribution. As such, suppliers can offer more competitive pricing. Both sides of a negotiation win in this scenario.
Cooperatives also present new opportunities for suppliers, opening up markets or locations without using any additional resources. This expanded footprint is especially valuable for companies that are trying to grow.
When a supplier’s proposals are accepted, and contracts are negotiated with cooperatives, it can enhance the supplier’s brand. Being selected after a rigorous, competitive solicitation process by an independent agency sends a strong message about the quality of what the supplier offers.
A supplier’s brand, goods, and services are also exposed to member institutions, building awareness.
Many cooperative contracts have longer durations compared to agreements with individual schools. This allows suppliers to build deeper relationships with procurement teams at educational institutions, gaining insight that can help secure more business. The better suppliers understand your needs, the better service they can provide.
Instead of managing multiple contracts and pricing with various institutions, suppliers can leverage centralized contract management for cooperative members. This consolidates paperwork, minimizes legal complexities, and allows suppliers to spend more time focusing on product development and customer service.
Suppliers get feedback from multiple educational customers, providing a broader perspective to better identify institution needs and industry trends. This often produces a collaborative approach to finding innovative solutions or refining products or services to address common needs more precisely.
Besides labor, one of the biggest expenses for suppliers is customer acquisition costs. Partnering with a purchasing cooperative to provide goods and services to multiple institutions dramatically reduces sales and marketing costs, minimizing the resources needed.
Cooperative contracts also provide greater insight into product mix, inventory management, and supply chains to forecast demand and plan operations more accurately. This also yields savings.
As the education landscape continues to evolve, the role of purchasing cooperatives is likely to become even greater. For suppliers, partnering with these cooperatives goes beyond just a sales channel by providing greater access and engagement with the education community. The benefits add up to a more efficient process for suppliers, who can pass on some of the savings to buyers.
Educational and institutional cooperative purchasing saves time and money for suppliers and schools.
E&I Cooperative Services is the only member-owned non-profit sourcing cooperative that focuses solely on the education sector. Membership is free for educational institutions, and there are no minimum purchase requirements. Members can view contracts and opt-in at their discretion.
View available contracts on the E&I Cooperative Services website or call the procurement experts at (800) 283-2634.
