Have you undertaken procurement training? Whether you’ve completed a college degree, gained an industry certification, or simply sat through an onboarding course provided by your employer, it’s unlikely that you were formally taught about group purchasing organizations (GPOs).
We know this because of an obvious education gap in the market. Our team is constantly chatting with procurement practitioners of every level, and have found that a number of buyers (outside of healthcare, especially) either haven’t heard of group purchasing, or have misconceptions about what GPOs do.
The profession would benefit from more organizations including GPO awareness as a part of their basic procurement training; if not in a formal sense, then at least as part of their team onboarding programs.
The Focus on Cost Levers
Most procurement learning providers focus on cost levers. These are the tools and techniques that help drive down costs and maximize savings, ensuring that every dollar spent is well-invested.
But what exactly are cost levers? They’re strategies that procurement teams use to negotiate better prices and terms with suppliers and help organizations get the most bang for their buck.
However, many procurement training organizations have stuck to traditional methods that haven’t evolved significantly over the decades.
Here’s a glimpse into the typical cost levers that are commonly taught:
Traditional Cost Levers in Procurement Training
- Negotiation Skills: Training often heavily focuses on negotiation tactics, emphasizing the importance of securing lower prices through one-on-one discussions with suppliers.
- Tender Processes: Many programs stress the importance of launching formal tender processes (RFx) to invite multiple suppliers to bid.
- Bundling: Training often encourages the bundling of contracts to secure standardized terms with the same supplier throughout the organizations
- Specification Optimization: Many programs advocate for the standardization of specifications or products, which can reduce complexity. This includes product innovation strategies, such as rethinking packaging to bring down costs.
- Supplier Consolidation: The idea of consolidating suppliers to negotiate better terms has been around for years.
- Reduce Consumption: Training often emphasizes reducing unnecessary purchases. This can be enhanced by encouraging digitalization to cut down on office paper costs and implementing make-or-buy decisions.
- Strategic Partnerships: Fostering strategic partnerships with suppliers can lead to collaborative cost-saving initiatives and innovation opportunities.
What About Group Purchasing?
Here’s the big question: why wouldn’t you include a cost lever that can save an average of 18% to 22% across multiple categories? Why invest all that time learning about various strategies that might only net you a fraction of those savings when such a significant opportunity is right in front of you?
The Efficiency Angle
It’s not just about cost levers. Many early-career procurement pros might not realize they can skip the lengthy RFx and negotiation stages entirely. This is where Una comes into play.
Think about the time it takes to vet suppliers, negotiate terms, and finalize contracts. It’s a lengthy process that can stretch weeks or even months. With Una, procurement professionals can bypass this red tape, allowing them to focus on strategic initiatives rather than getting bogged down in the nitty-gritty details. Members gain immediate access to over 2,500 pre-negotiated supplier contracts.
Immediate Cost Savings
Let’s talk numbers for a second. Una leverages over $100 billion in group buying power to secure discounts that would make any procurement professional’s heart skip a beat. On average, our members see savings of 18-22% across various categories. We’re strongest in indirect categories, facilitating significant savings on office supplies, IT services, facilities management and more.
Zero Obligations
The best part? Membership comes with zero obligations. Joining Una is free, and our contracts are free to use as you see fit. This means that procurement professionals can explore various suppliers and contracts without the pressure of commitment.
Enhancing Procurement Skills
Incorporating group purchasing into basic procurement training will boost savings and efficiency by enhancing the overall skill set of your procurement team. By understanding how to leverage group purchasing, professionals can develop a more holistic view of the procurement landscape. This knowledge enables them to make more informed decisions and identify additional opportunities for savings.
The Call to Action
If you’re leading a procurement team, let’s ensure that everyone, whether they come from a formal procurement background or have transitioned from another function, understands the vast potential of group purchasing. Highlighting the benefits of GPO membership can open doors to significant savings and streamlined processes.
Remember, we’re here to simplify procurement and empower organizations through increased buying power, comprehensive savings solutions, and superior service. Utilize our vast supplier portfolio and save more money, time, and effort with Una.
Contact us to get started - for free.
