GPOs (Group Purchasing Organizations) allow businesses to leverage the collective purchasing power of a group of businesses to unlock services or prices that are otherwise unavailable for niche organizations. GPOs help businesses overcome hurdles attributed to overhead, lack of relationships and expertise, or shortage of time to handle third-party vendors. An April 2009 study by Dr. Eugene Schneller, entitled, ‘The Value of Group Purchasing 2009: Meeting the Needs for Strategic Savings’, finds that GPOs save the U.S. healthcare industry over $36 billion dollars annually, savings that continue to grow.
The Power of GPOs Has Come To The Marketing Industry
If your company is considering whether a GPO might be useful for your brand or organization, there are several major benefits to consider.
1. Reduced Costs for Marketing Materials and Services
This benefit is the first and most powerful for marketing-focused GPOs. GPOs work with vendors to negotiate group benefits and pricing options that might otherwise be unavailable. By leveraging the power of all members, your company has access to pricing far below what you would be able to negotiate if you were sitting at the table alone with a marketing vendor.
2. Reduce Time Negotiating Contracts: Focus On Your Business
By using GPOs, members avoid the time and money required to negotiate and execute potentially thousands of individual contracts. Prepared contracts and vendor relationships allow employees to concentrate on operational and business-specific issues rather than vendor management.
3. Niche Focus, Mass Production: Gain Access To Relationships and Exceed Minimum Purchase Hurdles
GPOs allow even niche projects to experience economies of scale and plug those involved directly into the right vendor. The group organization gives you access to relationships and services that you may not otherwise qualify for simply because you aren’t producing the required volume on a specific project. Or it may be as simple as overcoming not knowing who to talk to about procurement or knowing a particular vendor / service existed.
4. The Power of Shared Ideas
GPOs provide a unique mechanism for a group of businesses to coordinate not only purchasing power, but also brain power. By drawing upon their broad-based memberships, GPOs give business owners, brand managers, and marketing teams a pathway to discover and evaluate new products and assess their impact on brand activities with reviews from trusted peers.
5. Vendors Pre-Vetted So You Don’t Have To Learn From Mistakes
Almost everyone has worked with a vendor that wasn’t the best fit. Missed delivery dates, poor quality, and lost time are symptoms of a bad relationship that you can’t afford. GPOs vet vendors to make sure they have a history of successful implementations so that you don’t have to learn by failing.
Power In Numbers
If GPOs sound like the the right fit for you, you may want to consider a membership with a company like Resource Department. Click here to request more information with no commitment.
Resource Department is committed to offering businesses access to a world of possibilities by sharing the table with other brands and businesses. We have a seat saved for you, so please reach out to our sales team today to find out more about what Resource Department GPOs can do for you.