Indirect Consortia Programs
What sort of leverage could you create by combining your spend in target indirect categories with 500 other companies? And what if you could achieve world-class category management and get unique category management technology at no cost? You can with the Insight Sourcing Group Consortia programs.
The concept of a consortia or group buying organization makes lots of sense. But as sourcing professionals, we have learned the hard way that not every indirect category is a fit. Volume and economies of scale are not the only determinants of price. Wildly differing cost-to-serve variables means trying to force-fit a consortia model in some categories yields programs that may either be highly restrictive and a poor fit for many, or do not provide savings relative to a custom-designed program. Therefore, we have a highly targeted set of consortia offerings.
Insight Sourcing Group’s consortia programs are a quick and easy solution for our clients to realize rapid or additional savings. Consortia programs leverage aggregate pricing in volume-driven categories so that you get the best possible service levels and pricing with leading suppliers.
The Insight Sourcing Group Consortia programs are unique in the marketplace for four reasons:
- Our programs are developed by hard-core sourcing professionals. Most other consortia in the market are developed by former sales people from the indirect world or by hospital administrators. Those programs often degrade over time as suppliers chip away at gaps in the contracts to improve their own margins. These groups are often guilty of consortia “overreach” and offer consortia in categories that are just not a great fit for aggregated, one-size-fits-all programs.
- Our consortia members receive SpendHQ’s Category Management module for free. These unique category-specific tools enable your procurement team to manage the category at a world-class level in a matter of minutes a month. They have full visibility to line-item detail and can spot and reverse negative demand patterns, eliminate waste, detect fraud, and track savings at an auditable level.
- We provide active management. We provide recommendations for additional savings and spend several thousand hours a year on vendor management to ensure our suppliers fulfill their commitments.
- If our out-of-the-box program is not a fit, we can customize it or even pivot to a full strategic sourcing process. No other consortium offers that flexibility or capability.
There are no fees to join the consortia as we receive a rebate from the vendors based on the total spend in our program. We have partnered with industry-leading suppliers to bring you world-class services and pricing in the following categories:
The Office Supplies Consortium from Insight Sourcing Group allows companies of all sizes to leverage the purchasing power of hundreds of companies. Clients save an average of 10% to 25% on their office supplies spend and additional savings on a year-over-year basis through demand optimization.
The MRO Consortium from Insight Sourcing Group grants members access to millions of MRO supplies and wide-ranging industry expertise. Clients of this program average 5% to 20% savings.
The Office Equipment & Advanced Services Consortium lets members save an average of 15% to 30% on a robust range of office equipment and advanced solutions such as document workflow, cost control software, and printer security.
How to Get Started
The implementation process for our consortia programs is quick and straightforward, requiring very minimal effort on your part.
- Opportunity Assessment
- We execute a confidentiality agreement
- We then perform data collection and a current state assessment
- Value Delivery
- You make the decision to join the program
- We then onboard the supplier and implement Category Management
“Once we saw the significant savings the office supplies consortium helped us achieve, we immediately extended the program globally.”
Manager, Global Sourcing
CGI Group Inc.
CONSORTIA PROJECTS SNAPSHOT
- $6B client joins Auto Rental Consortium and saves $500k+ over the life of the contract
- $3B retailer joined Office Supplies Consortium and saves 18% across the category
- Leading insurer utilizes the Office Equipment Consortium during its expansion to supply 60+ locations
- $1B MRO Consortium client sees initial 10% savings, then an additional 7% savings by optimizing its core list
Point of View Perspective
Why Consortia Should Be a Part of Every Procurement Leader’s Savings Strategy
In our conversations with senior executives, there has been one constant trend we’ve noticed: most procurement departments are understaffed and overcommitted. They’re managing hundreds of millions of dollars in direct and indirect spend across a myriad of complex, strategic categories that each demand significant time investment.
In this perspective, we look at why consortia should be part of every procurement leader’s savings strategy.
“CGI joined Insight Sourcing Group’s Office Supplies Consortium in 2011, which initially covered only our North American locations. Once we saw the significant savings the program helped us achieve—and how we were able to monitor the savings and communicate the results to other business units—we extended the program globally to include our locations in Europe and other parts of the world. The program’s robust contracted pricing list helps us further maximize savings.”
Manager, Global Sourcing
CGI Group Inc.