Procurement News, September 6th

TOUGH TIMES FOR UK GOVERNMENT SUPPLIERS?

The Sunday Times reports that the negotiations with major suppliers to Government "could"  lead to profit warnings shortly from some companies, and that Francis Maude has ''demanded' £800 milion "off suppliers' bills".  Their headline is; "Government's summer cost-cutting drive forces 19 companies, including BT, G4S and Serco, to sign agreements to shrink operations".

The article talks of them 'shrinking the scope of their public sector work', which to me sounds subtly different from price cuts (which is how this was originally positioned).  "The government is expected to reduce the specifications of some of its supply deals, which will save money on both sides", is another comment; which sounds eminently sensible, but again is not actually a 'price reduction'.  We have been somewhat negative about the way this programme has been carried out, but remain open minded and wait with interest to see the detail of these outcomes...

KIWIS BUY TRAINS, DON'T JUST PLAY RUGBY SHOCK

At the other side of the world, KiwiRail has today released its Request for Proposal documentation to the 11 companies short-listed to manufacture new electric trains for Auckland, New Zealand, reports NZNEWSUK.  11 sounds a bit of a long short list; I would not normally want to see more then 8 absolute maximum.  11 creates a real burden for the buyer, and is requiring 10 firms to do a lot of work for nothing, which is not very productive. So as we move out of the northern hemisphere summer....  do you need any consulting support in Auckland, guys?  Very reasonable rates....

NOT SO SWEET FOR PROCUREMENT STAFF AT ZAMBIA SUGAR

We've been predicting growth in procurement outsourcing for a while but to be honest we weren't particualrly thinking of Zambia Sugar, which has "outsourced its procurement department to Circle Transtra, one of the largest freight forwarding and clearing company in the country", according  to The Zambian Post Online.

"The development has also declared staff in the department redundant, and they will soon be separated from the company", it reports; doesn't look like there is any of this TUPE stuff in place here?  There is no real explanation as to the drivers behind this decision, but the spokesman does assure local suppliers that they won't be disadvantaged in any way by the move.

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