The challenges of education procurement

Kevin Frechette
CEO & Co-Founder
Fairmarkit
5-minute read

There has been a lot of talk about education reform in recent years, but all discussions invariably focus on the curriculum. While it’s true that the curriculum is in dire need of a thorough revision, the public-school system also needs to come up with strategies to save money and reduce spending in order to survive. This is where better procurement practices in education play a very important role.

Wasteful spending in public education

Many claim that we’re better off today than we were ten years ago, but that’s not entirely true when it comes to public education. In 2007, the then-DC Chancellor of Schools Michelle Rhee discovered piles of wasted purchases in warehouses across the district. All these purchases were supposed to end up in D.C. classrooms, but they never did. More than a decade later, wasteful spending remains a major problem.

In 2014, a story broke about the Fort Worth, Texas School District spending almost $3 million on tech equipment and software it never needed and never intended to use. An extensive survey published that same year revealed that the cities that were investing the most in education had some of the lowest test scores. Since the goal of education spending is to improve student success, this can be classified as wasteful spending. In business terms, this is a textbook example of a low return on investment (ROI).

The state of procurement in education

There are many more examples of wasteful spending in public education, but they all have one thing in common. Namely, they are the result of poor research and outdated procurement practices. This is somewhat understandable as procurement in public education is subject to very strict rules. For example, for every purchase above $10,000, Arizona charter schools must get at least three oral quotes. If the value of the purchase exceeds $50,000, they will need at least three written quotes.

All these rules and paperwork unnecessarily slow down the procurement process. According to a report published in 2017, a purchase that costs as little as $50 takes up to 16 days to process – and that’s excluding fulfillment and shipment. Things are even worse with large purchases, which can take several months to process due to all the paperwork and bureaucracy. It is very easy to lose track of these purchases when buying something as small as a set of Play-Doh can take up to three weeks.

Toward more effective procurement practices in education

Adopting more effective procurement practices in education could help eliminate wasteful spending and allow schools to save money that they can then use for other purchases. In addition to financial savings, the adoption of better procurement strategies will ensure that:

  • All services and goods schools purchase will serve their intended purpose
  • Suppliers are holding up their end of the deal and delivering the goods as agreed
  • All purchases are in compliance with the district laws and regulations

Comparing your spending to other schools in your or neighboring districts, commonly referred to as benchmarking, is a tried and tested method to test your current procurement strategies, but it might not always be the ideal solution. If you’re looking to improve your procurement processes, automation may be the answer you’re looking for.

With automated procurement, you get plenty of insight that you otherwise wouldn’t. For one, you get access to a wider network of suppliers to ensure that you are always getting the best deal. You can also track what other local public institutions are spending on specific goods and services to make sure you’re not overspending and thus wasting your precious resources.

Finally, you get access to automated Requests for Quote (RFQ), which not only saves your procurement team’s time but also allows you to multiple suppliers much faster than you normally would. Whether you’re buying a $50 pack of crayons or investing thousands of dollars in new equipment for your school’s computer room, you will have written quotes organized and ready whenever needed. And even if the purchase takes months to complete, you’ll be able to track every step of the process in real time.

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