Councils present an e-challenge to VARs
Huge savings to be made if local authorities use channel expertise
Resellers could save local authorities £1.1bn a year by helping them to implement e-procurement systems, but the challenge is getting council commitment, VARs have said.
A government-funded study from the office of the deputy Prime Minister has estimated that nationally local authorities could make the savings through wider use of e-procurement.
The research, which examined 12 local councils at various stages of e-government development, found councils are losing 726 days of productivity each per year by failing to adopt e-tendering, and 2,560 days due to a lack of e-purchasing systems.
Resellers with public-sector and e-procurement experience are ideally placed to build e-procurement systems, said John Griffiths, e-business consultant at reseller cScape.
"There's plenty of experience generating savings for the private sector, and resellers now have a lot of knowledge about local authority processes," he said.
But if resellers did not spell out the value of e-procurement, councils were often reluctant to commit money because the projects can take time to show return on investment, he added.
Mark Lawrie, partner at Deloitte, which conducted the research, said start-up costs could be lowered by councils banding together to develop e-procurement hubs.
"We think groups of two or three district councils could group together on e-procurement to get the benefits of the economies of scale," he said.
Kelvin Brain, director of consulting at reseller Compusys, said VARs have an opportunity to help councils expand their e-procurement use by developing catalogues.
"Most councils can cope with e-procurement for commodity items, but they don't have the sophistication to use it for all buying," he said.
The research calculated that a complete e-purchasing scheme would cost a council up to £1m to install, with savings taking two to three years to be realised.