Mike Haslin, Chief Executive Officer at TUCO, The University Caterers Organisation, discusses how to achieve value for money in these unpredictable times
Five key areas to make your budget last
Careful preparation can help a school or academy’s budget go further by gaining the best value for money, as well as other benefits such as a reduction in administrative time and increased safety. The Crescent Purchasing Consortium reveals how this can be achieved.
Planning is key when it comes to successful procurement throughout the academic year. Careful preparation can really help your budget go further by gaining the best value and benefits for your institution. Significant budget can be saved both in-house or by using outsourced procurement support.
1. Plan your key purchases
Review the contracts you have with suppliers at the start of the year and make a note of the dates that the contracts are due for renewal and plan time to carry out any procurement exercises throughout the year.
Consider creating a central contracts register to record all the contractual commitments that are in place and most importantly include the date of when the opportunity will be available to review them.
Plan in time to organise new purchases, some may only require a few weeks. When buying other more complex services such as for cleaning and catering contracts, ensure you schedule at least 12 weeks to complete the full process and allow approximately one month for the awarded supplier to mobilise the contract. Four months may seem a long lead time for the process, but the savings you could make from these purchases may equate to extra staffing. This planning time is important as it gives you the opportunity to identify your requirements early enough to ensure a robust detailed specification that can bring maximum benefits to your institution, as well as ensuring compliance with any timeframes that apply to contracts subject to the Public Contracts Regulations 2015. Timing is key to getting the best deal, delivered at the right time for your institution.
2. Get value for money
Purchasing consortia are set up to get you the very best deal, helping to make your budget go further. Deals cover a range of services and products required by institutions, from insurance through to desktop hardware. Due to buying power and a strong negotiating position with suppliers, consortia can secure competitive pricing and pass these savings on to you, giving you great value deals without the need to bulk buy.
3. Buy with safety
The deals that are put in place with suppliers by purchasing consortia provide safety. All of the terms and conditions are already agreed so there is no need to worry about getting tied into contracts that aren’t suitable or contracts that are extremely lengthy and difficult to get out of. Using a purchasing consortium deal puts you in control of the buying process and ensures money and time isn’t lost through signing up to unfavourable contract terms or contracts with hidden costs.
4. Introduce efficient and effective competition
When you are buying a product or service for your institution, your financial regulations normally require you to obtain a minimum number of quotations from a variety of suppliers, but this can take a lot of administration time and often the same suppliers are approached each time. An online quote tool takes the hassle out of finding and contacting new suppliers, as it does this for you. They save you time and get a great value deal from suppliers that have already been vetted. Using an online quote tool makes the competition fair for suppliers as it ensures all receive the same information and the tools provide an audit trail of the purchasing process.
When you are using an online quote tool you simply add your requirements to a website page and submit it including the date you would like suppliers to respond by. When adding your requirements try not to request specific branded products as this will limit the range of products and options that suppliers can suggest to suit your needs. Being too precise will also narrow the number of responses from suppliers, so instead detail the technical requirements of the product and be open to alternatives.
After receiving quotations from suppliers and evaluating which one best suits your needs, an online quote tool can be used to notify suppliers of the outcome and it will be kept as a record to show the process was followed.
5. Help is available
When you are completing a purchase request, whether it be your first order or for a complex contract, expert help is at hand. Some consortia have advisors available who can visit you to talk through your requirements. They can explain more about the deals on offer, demonstrate online quote tools and provide tips to help you make the most of your budget. Purchasing consortia also usually have support desks that can help with questions over the phone if you need an answer quickly. Should you need hands on support with purchasing you can also use a consultancy that have trained professionals ready to support you on a short-term or long-term basis, such as Tenet Education Services who are owned by the education sector.
Consultancy services do have a cost but this can often be recovered by the procurement consultant using their skilled expertise to secure additional benefits and cost savings.
Do be aware that some consultancies have hidden costs, ‘free services’ often result in a charge to the supplier that is inevitably passed back to the institution. Ensure that you review the full terms of the contract, hidden costs of five per cent of the contract value are not uncommon and could mean you could pay significantly more indirectly in the long run.
Crescent Purchasing Consortium
Crescent Purchasing Consortium (CPC) is owned and run by the education sector. CPC provides safe deals designed for educational establishments covering a wide variety of products and services. CPC’s online Quick Quote Tool is easy to use and CPC’s Regional Procurement Advisors are based nationally and provide specialist advice to members on how to obtain best value for money. CPC membership is free of charge to schools, academies and the FE sector.
Academies Financial Handbook
The government’s updated Academies Financial Handbook became effective from 1 September.
The handbook, which is updated every year, sets out the financial management, control and reporting requirements that apply to all academy trusts.
It balances the need for effective financial governance with the freedoms that trusts need over their day to day business.
Compliance with the handbook is a requirement in trusts’ funding agreements with the Secretary of State.
Amongst the changes in this updated edition include setting clearer requirements for budgeting and greater emphasis on trustees applying high standards of governance.
It also strongly recommends that academies use national deals for schools, which it says makes buying simpler and quicker, and can provide better value for money in a range of categories.There is also guidance on how to plan and run an efficient procurement process.
The CPC has been included in eight frameworks: Building Cleaning Services, Audit Services, Insurance and RPA Services, Desktop Hardware, ICT Solutions, Software Licences, Photocopiers, Printers and Scanners, and PAT Testing, with more to follow.
See the guide at www.tinyurl.com/y9qpb85vFurther Information: