Spend Matters Almanac: Group Purchasing Organization

Group Purchasing Organizations (GPOs), also known as buying consortiums and purchasing coalitions, are entities that attempt to leverage the purchasing power of their participating member/customers, who may also be the GPO’s owners. Many GPOs have traditionally operated as non-profits, but a growing number are for-profit entities; some are even publicly traded. Although a GPO’s primary purpose is to drive member utilization of its prenegotiated contracts for products and services –usually nicely qualified, discounted arrangements reflective of the group’s common and sometimes aggregated purchasing volumes– modern GPOs are also adding a variety of value-adding procurement and supply chain management services as well. These services range from spend category-based market intelligence services (e.g. GPO demand market(s) visibility makes it a natural for providing benchmarking services) to software automation tools designed to streamline P2P processes. More often than not, the GPO’s business model relies on supplier paid fees, but other hybrid models have emerged that include subscription service dues and other usage-based fees. Sometimes, the GPO will even share-back some of its collected fees to highly compliant members.

Insight Sourcing Group
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Insight Sourcing Group helps clients improve earnings by reducing procurement-related costs. Working with senior executives, purchasing teams, and other stakeholders, ISG drives savings by providing strategic sourcing expertise, implementing procurement best practices, increasing spend visibility, and developing indirect spend consortia. Founded in 2002, ISG is the leading procurement and sourcing strategy firm in North America. The company's leadership includes Fortune

OMNIA Partners
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OMNIA Partners is the nation’s largest, most experienced, and most trusted resource in group purchasing and supply chain management. OMNIA Partners unites industry-leading purchasing power and suppliers to deliver an extensive and diverse portfolio for indirect and direct products and services in private sector procurement. Power. Access. Trust. omniapartners.com/private sector

Perfect Commerce
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Perfect Commerce develops cloud-based procurement and sell-side ecommerce software for the public and private market sectors. With broad global reach and deep international capabilities, Perfect Commerce is used daily by more than 2 million users across over 70 countries, 12 languages and 60 currencies. We also own and operate a leading independent supplier network with hundreds of thousands of suppliers.