Business and money

Buying as one

Until three years ago, each of the seven hospices in the Tarrow Valley bought its own gas and electricity, negotiated its own cleaning contract and ordered its own medical gloves, often from the same suppliers at noticeably different prices. None of them employed a purchasing specialist; the job usually fell to whichever manager had the least crowded diary. When the hospices agreed to form a buying group and share the salary of a single purchasing officer, several trustees doubted that the arrangement would ever pay for itself. It did so within eighteen months. Across the seven organisations, spending on energy and supplies fell by around eleven per cent over two years – a period in which the prices of most of those goods rose steadily, which makes the saving all the [1] remarkable. Just as valuable, the hospices' managers say, are the hours they no longer spend comparing quotes.