The January 14, 2014 city council agenda has several purchasing department items on it, including some more activity from buy boards.
Agenda item 6.1 proposes the purchase of 7,000 of those recycling and refuse containers that we use in El Paso. The backup material proposes that the purchase be made through the Houston based buy board that the city likes to use. The backup material states “The city has made the determination that purchasing from this cooperative offers the most cost-effective pricing”.
The price will be $51.39 for each of the 96 gallon containers. Shipping will be another $13,800, bringing the total purchase to $373,580.
Bidding must be expensive
If I am correct the supplier must pay 4% of the purchase price to the buy board as part of their administrative fee. That comes to over $14,000. How much would it cost the city to issue and conduct a bid for this item? Would it cost $14,000? Would the vendor lower the price by 4% since the buy board would not participate?
Might some other vendor come in with an even lower bid price?
Remember that the 4% benefits school districts in Houston. Isn’t that nice of us?
Not being an expert
Purchasing must be complicated so I need to be careful here to not make it look too simple. I decided to try to figure out what other cities pay for their garbage cans, so I entered “96 gallon bid” into my search engine.
Within a second or two I got 26,3000 results. The third item down gave me the results of actual bidding.
As it turns out, the city of Bay City, Michigan wanted 1,000 units in September of 2013. The low bid was $47 each versus the $51.39 our city wants to pay.
We deserve better
Brutus
elpasospeak 
I quote: “The city has made the determination that purchasing from this cooperative offers the most cost-effective pricing.”
How can it make that determination without even some minimal level of bidding? Furthermore, these kinds of statements are simply accepted by city council.
Note that the “city” made that determination — not a named individual on the city staff.
What world do these people live in?
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As I said, on equipment purchases, the buy boards are usually the best (and sometimes only) price. This from my actual experience. If there is not a local vendor that offers the specific equipment or material you need, there are local vendors who will source it for you and add their 10% or so and the cost is higher for the same stuff. There is nothing to stop a local vendor from offering their goods on the buy boards, but not many do so. That was my experience over the last 3 years buying a LOT of stuff for the broadband project.
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I ran into this problem, too, and pity poor Purchasing that has to explain to CC when their constituents who lost the bid start to complain to them. The Purchasing Director told me that it is like a pendulum that swings over time between low cost and local preference. The buy boards are good for material and equipment purchases as in your example. But I did not like to use them for purchase of services and the one time we did was a disaster.
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Wall Street had a full page ad from Target on hacking. Guess WSJ does not know we have a local newspaper in a town where they have stores. Hmmmmmmm
Sent from my iPhone
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Sorry to be dense, but why should WSJ care that we have a local newspaper? What’s your point?
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