Understanding the Difference: Traditional Bid Route vs. Cooperative Purchasing
When organizations look to procure furniture, they typically follow one of two paths: the traditional bid route or the cooperative purchasing path. Each has its advantages, timelines, and costs associated with the process. Understanding these differences can help decision-makers choose the best approach for their specific needs.
The Traditional Bid Route
The bid route is a multi-step, often lengthy process that requires significant time and resources. Here’s a breakdown of the key stages:
Customer Identifies Need – Define project scope and requirements.
Develop Specifications and Scope of Work – Outline technical requirements.
Procurement & Legal Review – Ensure compliance with purchasing regulations.
Draft Solicitation – Prepare official documents for supplier bidding.
Advertise Solicitation – Publish bid opportunities for vendors.
Pre-Bid Meeting – Provide an overview to potential suppliers.
Q&A and Addendums – Address supplier questions and clarify scope.
Supplier Submits Bids/Proposals – Vendors submit pricing and documentation.
Check References – Validate vendor reliability and past performance.
Evaluate Bids – Compare submissions based on predefined criteria.
Request Samples – Ensure product quality and compliance.
Negotiate & Award Contract – Finalize terms and pricing with the selected vendor.
Possible Protest – Address any formal objections from losing bidders.
Board or Management Approval – Obtain necessary internal approvals.
Use Contract & Order Items/Services – Procurement is finalized and executed.
The Cost of a Traditional Bid Process
Pros:
Allows for full customization of products and services.
Encourages competitive pricing among vendors.
Ensures compliance with procurement regulations.
Cons:
Time-intensive, requiring significant administrative hours.
Can lead to delays due to protests or extended evaluations.
Higher costs due to extensive legal and procurement processes
Conducting a bid or RFP process requires extensive time and personnel hours. According to the National Cooperative Procurement Partners (NCPP), the average time investment for a project is 87.1 personnel hours. Complex projects can take 138.7 hours, while simpler projects require about 42.9 hours. These costs add up quickly in terms of labor, administrative resources, and delays in procurement.
Average Time spent by phase
The Cooperative Purchasing Path
Cooperative purchasing simplifies procurement by leveraging contracts that have already been competitively solicited by a lead agency or cooperative organization. This dramatically reduces the time and effort required to obtain furniture and other products.
Key Stages of Cooperative Purchasing:
Solicitation Process Conducted by Lead Agency or Cooperative Organization – A vetted organization manages the procurement process.
Awarded Contract Ready to Use – Pre-negotiated contracts are available immediately.
Customer Identifies Need – Determine the required products or services.
Find the Right Cooperative Contract & Supplier – Select from available cooperative agreements.
Conduct Due Diligence – Ensure contract alignment with organizational requirements.
Board or Management Approval – Obtain internal authorization.
Use Contract & Order items/Services – Proceed with procurement quickly and efficiently.
Pros:
Significantly reduces procurement time.
Offers pre-negotiated, competitive pricing.
Ensures compliance with purchasing regulations.
Provides a streamlined and efficient process.
Cons:
Limited ability to customize products and services.
Requires due diligence to ensure contract alignment with needs.
Some organizations may have restrictions on cooperative purchasing eligibility.
Organizations need to weigh the benefits and costs of each procurement method. The traditional bid route offers maximum customization but requires extensive time and resources. Cooperative purchasing, on the other hand, provides a streamlined, cost-effective alternative that speeds up procurement without compromising compliance or quality.
For businesses looking to furnish their spaces efficiently, cooperative purchasing can be a smart alternative. By leveraging contracts from trusted cooperatives, organizations can reduce procurement headaches and focus on what matters most—creating inspiring, functional workspaces.
Interested in learning more? Contact us to explore how cooperative purchasing can work for your next furniture project.
NCCP. (2024). How Much Does it Cost To Conduct A Bid Or Request For Proposal Process? [Infographic]. NCCP.
