Procurement Hubs drive innovation in Local Government
As resources employed in managing procurement are significant and often fragmented, they tend to increase costs for the Public Sector, suppliers (who pass it on in higher prices) and for SMEs. Fragmentation brings its own problems, including lack of aggregation and common specifications, multi-dealings with common suppliers, varied standing orders and quality of contracting, varied degrees of commitment to contracts and most importantly, hugely varied prices. To reduce the procurement fragmentation costs, public sector organisations are realising the benefits to be gained from buying collaboratively.
Engaging with suppliers is becoming increasingly important, with the Government aiming to ensure Public Sector organisations are engaging with SME business communities and offering fair contract opportunities. Public Sector procurers are being urged through Government Agenda to maximise value and reduce spend through improved supplier relationships.
With the Glover Report, published by HM Treasury recommending that by 2010 all Public Sector contracts over £20,000 are published online, Procurers need a solution to these challenges.