02 03 Inside HSCA: Group Purchasing Perspectives: GPOs in the Firefighting and First Responder Acquisition Communities 04 05 15 16 19 20 21 22 23 24 25 26 27 28 31 32 33

Group Purchasing Perspectives: GPOs in the Firefighting and First Responder Acquisition Communities

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Continued economic uncertainty means that organizations across a broad range of industries are increasingly turning to GPOs and the group buying model to stretch their budget dollars.

American hospitals are already relying more than ever on their GPO partners to deliver the best, most innovative products at the best value, and to provide significant healthcare cost savings to hospitals, Medicare and taxpayers. In addition to the healthcare sector, industries such as grocery manufacturers, electronics manufacturing, industrial manufacturing, agriculture and the non-profit communities all commonly rely on GPOs to deliver critical cost savings. The White House and federal agencies such as General Services Administration, Department of Defense, and Department of Veterans Affairs all leverage group purchasing to help maximize budget dollars. Recently, online group purchasing or “social” buying as surged with the advent of companies such as Groupon and Living Social.

Firefighter Nation, the social network for the firefighting and first responder community, and FireRescue Magazine recently explored the role of group purchasing within the fire and rescue acquisition process:

It’s easy to understand why many in the fire service would find the apparatus speccing and bidding process to be a bit overwhelming, particularly when personnel are being pulled in countless other directions and often don’t have time to attend apparatus committee meetings or spend hours contacting manufacturers. The process is complex and long, and involves community needs assessments, hunting for funding sources, writing grant proposals, researching NFPA standards, writing specifications, and obtaining RFPs and bids. Of course, this is all compounded by the pressure to spec an apparatus at the lowest possible cost.

Fortunately, there is an apparatus-purchasing option that many firefighters are not familiar with, but that could save departments thousands of dollars: group purchasing organizations (GPOs). Specifically, a GPO is a cost-savings channel that functions as a “third-party aggregator” of contracts for goods and services. A GPO’s purpose is to leverage purchasing strength through membership in order to acquire goods (like apparatus) at lower prices. The GPO neither buys nor sells anything, but rather assists with the purchasing process and provides access to special contract pricing. In addition to negotiating discounts for its members, a GPO can help with product research, obtaining quotes and writing RFPs.

FireRescue also conducted a Q&A on the group buying model with Crosby Grindle, Executive Director at FireRescue-GPO, and Bruce Beardsley, manager of marketing and constituent relations at COSTARS, Pennsylvania’s cooperative purchasing program. The outlet asked if current economic conditions have led to an increase in the use of group purchasing:

Grindle: “The FireRescue-GPO has been the only national fire service-specific group-purchasing program for years, but we have noticed an increase in the expansion of regional programs to the national level, as well as national programs expanding into the fire business. It is logical to deduce that the cost savings of working with a GPO have resulted in their growth and popularity.” 

 Beardsley: “Yes, our two contracts specifically designed for EMS services increased by 80% for 2012 over 2011.” 

 To read the full article, click here.

 For more information on the role of healthcare GPOs in the supply chain, visit www.supplychainassociation.org

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