Every group purchasing organization (GPO) is different. Though they all provide access to discounted prices on a catalog of products and services, each has their own individual qualities. When your organization is looking to join a GPO, it’s critical to find the most suitable partner. But what should you be looking for, and how do you know which GPO is right for you?
Contracted Suppliers and Products
Each GPO has contracts with different suppliers, providing its members with access to discounts on a unique selection of products and services. Some serve specialist markets, such as healthcare providers, and therefore have a specifically targeted portfolio. Others have a diverse membership, which is reflected in a wider variety of contracted products.
Information on specific suppliers and products is not always publicly available. Arrange a meeting with a representative to discuss your unique needs and determine if the GPO has reduced rates on the products and solutions your organization requires.
Questions to Ask:
- Does this GPO work with suppliers I trust and use?
- Does this GPO offer discounts on products and services I’m already purchasing?
- Can this GPO audit my existing inventory and purchase orders to find all of the products I could purchase at a discount?
Industry Experience
Experience is an important consideration when choosing a GPO, especially if it’s your organization’s first time working with a purchasing partner. By opting for a more experienced GPO, you can purchase with confidence knowing that you have a team by your side that has spent years honing the process. It’s also helpful to know that the GPO has supported other organizations like yours and has an understanding of your industry.
Questions to Ask:
- How long has the GPO been operating?
- How much experience does the GPO have in supporting organizations in my industry?
- Do I trust this GPO to understand my unique purchasing requirements?
Purchasing Power
One main benefit of joining a GPO is that it allows smaller organizations to access discounted prices usually reserved for much bigger companies with larger purchasing volumes.
GPOs use the combined purchasing power of their members to negotiate discounted prices with suppliers, acting as one larger entity in what is called “aggregation”. The more purchasing power their collective membership has, the more leverage the GPO brings to negotiations to secure lower prices. What’s more, some GPOs, like CNECT, aggregate their purchasing power with other GPOs to further strengthen their position in negotiations.
Questions to Ask:
- How many members does the GPO have?
- How much purchasing power does the GPO negotiate with?
- Does the GPO aggregate its prices with other GPOs?
Additional Support Provided
Most GPOs provide support beyond just connecting you to contracts. Additional services may include regular check-in meetings, spending analyses, and proactive work that helps you maximize your savings.
Support Offered by CNECT
- Customized Business Reviews — Provide a thorough review of the member’s GPO utilization and identify new opportunities to save.
- Price Comparisons — Ensure the member is accessing the lowest prices possible by comparing the prices they’re paying with CNECT’s contract pricing.
- Vendor List Analyses — Pinpoints areas of potential savings by reviewing the member’s vendor list and aligning it with CNECT's contracted suppliers.
Questions to Ask:
- How much support does the GPO provide in addition to contract connections?
- Would the GPO be proactive in helping me maximize my savings?
- Does the GPO provide support that would save me time?
Transparency and Communication
Communication is essential for successful partnerships, so it’s crucial to choose a GPO that regularly interacts with its members. The resources and information provided by the GPO, often through their website, may give some indication of how well they keep their members informed.
There’s a common misconception that GPOs aren’t transparent about their business models, but this is a myth. In fact, GPOs are required by law to provide certain information to their members. If you want to know more about a GPO’s practices, ask — the clarity of their response may tell you everything you need to know.
Questions to Ask:
- How does the GPO communicate with its members?
- What resources does the GPO provide?
- Does the GPO provide clear or vague information about itself and its operations?
Is CNECT the Right GPO for You?
CNECT currently has more than 9,300 members, and we serve organizations in many different industries. With more than $82 billion combined purchasing power, we’ve negotiated discounts on more than 2.7 million products and services. Since 1979, CNECT has supported its members in saving money, strengthening their supply chains, making informed decisions, and achieving their operational goals.
We’d love to discuss your needs and find out if we’re the right GPO for your organization. To get started, get in touch through our contact page!