A "purchasing cooperative" is a type of

cooperative A cooperative (also known as co-operative, co-op, or coop) is "an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democratically-contro ...

arrangement, often among businesses, to agree to aggregate

demand In economics, demand is the quantity of a good that consumers are willing and able to purchase at various prices during a given time. The relationship between price and quantity demand is also called the demand curve. Demand for a specific item ...

to get lower prices from selected suppliers.

Retailers' cooperative A retailers' cooperative is a type of cooperative which employs economies of scale on behalf of its retailer members. Retailers' cooperatives use their purchasing power to acquire discounts from manufacturers and often share marketing expenses. A ...

s are a form of purchasing cooperative. Cooperatives are often used by government agencies to reduce costs of

procurement Procurement is the method of discovering and agreeing to terms and purchasing goods, services, or other works from an external source, often with the use of a tendering or competitive bidding process. When a government agency buys goods or serv ...

. Purchasing Cooperatives are used frequently by governmental entities, since they are required to follow laws requiring competitive bidding above certain thresholds. In the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territori ...

, counties, municipalities, schools, colleges and universities in the majority of states can sign interlocal agreements o
cooperative contracts
that allow them to legally use contracts that were procured by another governmental entity. The National Association of State Procurement Officials (NASPO) reported increasing use of cooperative purchasing practices in its 2016 survey of state procurement. NASPO has noted the increasing popularity of cooperative purchasing but also recognises that, like any practice, "it can be done well - or poorly".NASPO
Strength in Numbers: An Introduction to Cooperative Procurements
first published February 2006, updated 2010, accessed 24 March 2022

Examples

An example of a purchasing cooperative is Harris County's Department of Education (HCDE) in

Texas Texas (, ; Spanish: ''Texas'', ''Tejas'') is a state in the South Central region of the United States. At 268,596 square miles (695,662 km2), and with more than 29.1 million residents in 2020, it is the second-largest U.S. state by ...

, which has created three procurement cooperatives: *Choice Facility Partners, a facility services cooperative which serves government bodies throughout Texas and elsewhere in the United States Harris County Department of Education
About HCDE
accessed 24 March 2022 *Gulf Coast Cooperative, a food cooperative primarily serving schools, and *HCDE Purchasing Cooperative, offering more than 275 vendor contracts for commodities. Various schools, colleges and universities, municipalities, counties, municipal utility districts and other governmental entities sign an interlocal contract with HCDE, thus becoming members that can access any of the multitude of competitively bid and legally awarded contracts available through their cooperatives. To optimize processes, these three cooperatives were combined into Choice Partners national cooperative in 2012. Through use of Choice Partners, HCDE generates revenues to support the

school district A school district is a special-purpose district that operates local public primary and secondary schools in various nations. North America United States In the U.S, most K–12 public schools function as units of local school districts, wh ...

s within Harris County. In a similar way, Catholic parishes in the

Archdiocese of Cincinnati The Archdiocese of Cincinnati ( la, Archidiœcesis Cincinnatensis) is a Latin Church ecclesiastical jurisdiction or archdiocese that covers the southwest region of the U.S. state of Ohio, including the greater Cincinnati and Dayton metropolitan ...

Ohio Ohio () is a state in the Midwestern region of the United States. Of the fifty U.S. states, it is the 34th-largest by area, and with a population of nearly 11.8 million, is the seventh-most populous and tenth-most densely populated. The sta ...

, have established a cooperative purchasing process to combine buying power and reduce costs. Missouri State Statutes (Chapter 34, Chapter 37 and Chapter 67) authorize the State's Division of Purchasing to conduct a cooperative purchasing program, and allow eligible local governments, political subdivisions, and quasi-public governmental bodies to participate in the program.State of Missouri, Office of Administration, Division of Purchasing
Cooperative Procurement Program
accessed 23 December 2020

Costs

Many cooperative purchasing programs levy charges for usage and access. Fees may be assessed as an annual enrolment fee or a transaction fee such as a levy of 1% or 2% on the value of every purchase.

References

{{DEFAULTSORT:Purchasing Cooperative Cooperatives