One
of the things that our members and vendors have been
asking for is more training tips on general procurement
and working with Mohave contracts.
Along
these lines, we are adding a new feature to our Mohave
Newsletter, "Training Corner," and
we would appreciate your input. Have a great idea or
process that
you are using in your organization
that is saving you time, money, or otherwise making
the procurement process easier for all? Send it to
us. We would love to hear from you.
Blanket
Purchase Orders Can Be Win-Win
This
month, we would like to discuss the value of Blanket
Purchase Orders (BPOs). First and foremost, BPOs are
for "as needed goods and services against an existing
vendor contract" and one such example of a common
BPO here at Mohave is for miscellaneous school bus parts.
Historically,
the problem with BPOs is that the ordering authority
sometimes does not put in place procedures to manage
the available balance and/or does not have time or make
the time to reconcile periodically. This doesn't have
to
be the case.
How
can you create a win-win situation?
Think about establishing a BPO with perhaps 90 days of funds
(you can do it for the entire year if you are comfortable with the
ordering activities ability to monitor the balance). This way you are
not opening the entire checkbook, and you are creating a situation
where you do not have to do a purchase order for each individual bus
part or group of parts. This can greatly expedite your bus part ordering
and allow for timely return to the fleet of your downed bus. Also,
by putting only 90 days of funds on your BPO, you are ensuring that
a reconciliation of some sort will need to be done at the 90 day point.
This will make your accounting staff and business office more supportive
of the BPO.
Some
Thoughts on Successful Use of BPOs:
- BPOs
speed the purchasing process, reduce processing and
help manage multiple as-needed purchases.
- BPOs
help ensure compliance by providing an easy means of
tracking aggregate purchases from a single vendor and
by ensuring that a PO is in place when materials are
needed.
- BPOs
should be effective, in order to be efficient. Therefore,
quarterly, semi-annual or annual BPOs are recommended.
- BPOs
require less processing and easier management than
monthly BPOs.
- BPOs
need not tie up large amounts of funds to be effective.
A reasonable starting amount can be set and the BPO
can be increased, as required. However, being unduly
conservative in the BPO amount increases workload.
- Also,
you can use BPOs in the areas of routinely purchased
materials such as janitorial supplies, classroom supplies,
office supplies, and technology supplies. The contracts
provide compliance, regardless of aggregate expenditures,
and BPOs are efficient means to use those contracts.
If
you have questions on this or other areas where you can
be more effective in your ordering of items through our
Mohave contracts, let us know.
Mark
A. Kinsey
Director of Outreach and Education
Mohave Educational Services Cooperative, Inc.
5225 N. Central Ave. #218, Phoenix, AZ 85012
Phone: (602) 277-4290
Email: markk@mesc.org
