Five tips from NSA to consider before joining a GPO

CHARLOTTE, NC — National Service Alliance (NSA) has developed a list of five tips for building service contractors (BSC) considering joining a group purchasing organization (GPO), according to a release.

Group purchasing organizations create savings for those in the group by using group-purchasing power to gain larger discounts from manufacturers.

“With the economy in growth mode and more commercial facilities being built, many building service contractors report their businesses growing significantly,” the company says in the release. “However, with growth, larger contractors become increasingly pressed to look for ways to control costs, especially when it comes to cleaning supplies, tools and equipment.”

When this happens, BSC often turn to group purchasing organizations. But NSA Executive Director Terry Sambrowski recommends contractors consider the following five points before joining a GPO:

1. Does the GPO specialize in the products and equipment the contractor typically purchases? While a healthcare GPO may carry some cleaning equipment, their specialty is healthcare and not professional cleaning. Select a GPO that specializes in cleaning supplies and equipment.
2. Does the GPO work with regional or national distributors or both? Select a group purchasing organization that works with distributors that can deliver anywhere in the country.
3. Will the GPO be a true business partner? Not all GPO members will have similar needs. The GPO should be able to tailor its services to align with each member’s needs and strategic goals.
4. Does the GPO have a good working relationship with its distributors? The GPO should not only have a good working relationship with its distributors, but also should have a strong working relationship with all the GPO members. Essentially, all three groups are part of a team working together.
5. Does the GPO provide additional services? Savings on products are one thing, but a group purchasing organization should also offer networking opportunities, meetings with manufacturers, training programs and so on.

“Finally, the contractor should be clear about the fees the GPO charges,” Sambrowski adds in the release. “While they tend to be moderate, complete transparency is the key to a healthy working relationship.”