Purchasing & Supply Chain Management

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Buying Co-operatives - A Cost Cutting Business Solution


 

Features of Buying Co-operatives

  • Buying co-operative enlists members who buy commonly used products or services.
  • Through a negotiator, in this case Velocity, the Buying co-op leverages its combined buying power with suppliers.
  • The co-op negotiator creates interest & competition in the marketplace for the combined business of the co-op members.
  • Members continue to control their own buying practices.
  • Members use a single source of supply.
  • A long term supply contract with performance criteria
  • Members can opt out of the co-op at will.

Benefits of Buying Co-operatives

  • The combined buying power will leverage deeper discounts for all co-operative members and therefore reduce direct costs for all members.
  • The combined buying power will exact more competitive terms of sale i.e. further discounts for early payment etc.
  • Co-op members can receive Web-enabled detailed buying reports from the supplier.
  • Co-op members can perform buying transactions, if they wish, over the Web and thereby further reduce their indirect costs and reduce clerical effort.

 

What value does Velocity provide?

  • Solicit members to join the co-operative and thereby increase the buying power.
  • Create interest and competition for the co-ops business.
  • Negotiate the terms and conditions with suppliers that will reduce costs for the co-op membership.
  • Central point of communication and information for the co-op members.
  • Provide training to co-op members if necessary.
  • Ensure that co-op member concerns are addressed and actioned.
  • Ensure that suppliers are providing a high level of service and are meeting contract performance requirements.
  • Twenty-five years of professional buying and contracts negotiation experience.
  • Well developed business relationships with the Calgary supply community.

Time & Effort of Co-op Members?

  • Provide annual cost information, which once combined with all members, provides the primary tool for negotiations: buying power (leverage). This same information will clearly define for co-operative members what their potential cost reductions will be.

Membership Costs.

  • The cost will be a one-time annual membership fee.
  • Velocity will determine the individual co-op member annual fee amount based on the degree of cost reduction realized. The number of co-operative members will also determine the fee amount. The fee will be very attractive and affordable.
  • The fee will be prorated; which means if a member opts out after six (6) months then half of the annual fee is refundable to that member.