Local government agencies are finally starting to practice a business technique used 20-30 years ago. It is called CONSOLIDATION and COLLABORATION.
As the following article explains, the Lake County government (actually at least 3 separate agencies), the School District, and several cities organized a "vendor" fair at the Round County admin building last Friday for various suppliers of goods and services to meet and greet the purchasing managers or staff of about 10+ local government agencies. The sponsoring group is called the Procurement Officials of Lake (County - "POOL"),
Our good buddy and radio commentator Ralph Smith reminded me in a phone call, and I went over, amazingly finding a parking spot nearby. (Another issue). The line wasn't too bad to move around all the different agency tables, get business cards and talk procurement. However, those arriving after 10 am had a 30+ minute wait in line.
Naturally, I also interviewed some vendor reps (usually sales people) around me in line, and got some inside info. One vendor rep said one local government agency specifies a particular brand of parts, thus they never get competing bids from suppliers with more cost effective part brands. "It has been going on for years.." he said. He said Volusia County specifies three brands of parts, and separate distributors, so they not only get competitive bids from several distributors, but also competing prices for the different brands for the same part.
Also, some understaffed or "lazy" agencies may rely on using "piggyback" bids from other agencies which may be for out of County providers. One purchasing manager said he really resists using those types of bids because the prices could be old, and he must spend time comparing all the specs to his to determine they are the same. He would rather issue new bid requests to get local bids. One vendor was aggravated at being locked out of local bids from one agency that used piggyback bids.
A key manager from Lake County Purchasing gave a good presentation on the procurement process and what vendors should keep in mind. His Powerpoint is HERE. The powerpoint lists dos and don'ts for both purchasing departments and for vendors. For instance, vendors should never rely on a verbal order, but always get it in writing as a purchase order. (Personal experience: In Iraq, the federal buyers issued an rfp for a group of custom gun safes, and a local Iraqi firm built the items completely based upon a verbal discussion seeking qualified bidders. They thought they had the deal, and didn't, and ate the entire deal since the safes were sourced after competitive bidding with another firm and a written purchase order was issued. The Iraqis were used to handshake deals and didn't understand the Federal bidding process.)
The organizers had each vendor fill out an information sheet, and they said each agency procurement office would get a copy (I am not sure if they meant they would share an online database, which would be much more efficient than making copies of several hundred forms for each agency.).
However, the group of procurement officials plan to create an online vendor registration system so vendors would only have to register once in order for all participating agency procurement departments to see their information and communicate about bidding opportunities. The current delay is caused by a lack of agreement on what commodity codes to use for the combined system. Those codes vary by agency, and most don't want to give up their own coding system.
Then, the next step in my opinion would be to CONSOLIDATE many of the purchasing functions into one shared, automated system. For instance, why should there be completely separate purchasing departments for the County Board, and the Sheriff, and several others? Or, they could start by combining certain big dollar items and services like utilities, phones, vehicles, etc.
It was a good fair indicating a movement to more efficient usage of procurement processes, with two minor issues:
- Except for the Powerpoint above, there were no online copies of agency contacts and documents they handed out. There was one excellent printed handout listing many websites but it contained no reference to an online copy.
- The Community College didn't have their procurement staff there - instead their table was staffed by folks from the Business Services Office giving out info about entrepreneurship and training programs they offered. That disappointed some attendees looking for connections with a purchasing manager.
vj
published: Sunday, March 01, 2009
Businesses fish for future government business at vendor fair
BENJAMIN ROODE
Staff Writer
TAVARES -- During a recession, businesses go to the consumers spending the most money.
Right now in Lake County, that's local government.
"The money right now that is to be spent is in the government sector," said Stephanie Vaughn, director of planning with Farner and Barley, a Wildwood-based civil engineering firm. "The private sector does not have money."
Vaughn, four of her colleagues and hundreds of other business owners hoping to win future local government contracts swarmed the Lake County Administration Building in Tavares Friday morning for the Reverse Vendor Trade Show, a joint effort among several Lake County cities and Lake County governmental entities to meet more local businesses and for those businesses to learn how to partner with government.
Organizers were surprised and pleased with the response. Hundreds of businesses from inside and outside the county networked and got their foot in the door for possible future projects. Some, like Farner and Barley, were hoping to win contracts in the future. Others, like Skip Horton with Faitella Enterprises, a water systems company out of Fort Pierce, were there to learn the ropes of government business.
Some businesses in attendance were hoping to get a foot in the door for possible federal stimulus money trickling to the local level. Cities like Leesburg posted their list of upcoming projects.
The event is a precursor for plans to do more joint business among the cities and county, said Barnett Schwartzman, Lake County's procurement services director, and Mike Thornton, Schwartzman's counterpart in Leesburg. Governments that pool resources and buy items like office supplies and fuel in bulk can save money.
"If we consolidate purchases, we can get a better price," Thornton said.
Many government officials in attendance met representatives from Lake County businesses they hadn't known about. That broadens the bidding pool for government contracts, possibly getting better prices for taxpayer dollars and even bringing more business to local entrepreneurs, Schwartzman said.
