Charity wins bid to cut costs

Cancer Research UK uses online auctions to save on procurement

Cancer Research UK has saved £2.5m in 12 months using online auctions for the procurement of office supplies, IT hardware and laboratory equipment.

The saving is part of an initiative intended to cut the charity’s £130m purchasing budget by 10 per cent.

‘The online auctions are part of quite a challenging savings programme,’ said Belinda Turner, procurement director at Cancer Research UK.

‘Judging by the work we have done so far, savings will probably exceed £12m per year in three years’ time.’

The auctions work on the same principle as a normal tender process, including preparatory work and initial market research.

The final stage is an online tendering process that provides the charity with the most competitive price for supplies.

‘This is certainly not new technology but it’s quite unusual for the charity sector and a very good way of maximising our charity funds,’ said Turner.

The first online office supplies auction delivered 30 per cent savings. The IT hardware auction saved 20 per cent and another 33 per cent was saved on laboratory equipment.

The number of suppliers was reduced from more than 200 to just a handful.

The team is now working on a fourth auction, to take place next month, to source molecular biology supplies such as live cell cultures.

It is also considering using the same online technology to acquire temporary office staff.

The charity has outsourced the web-based auction process to Aria Insite and Vendigital, but Turner says it may be brought in-house in the future.

She says there is more detail in the preparatory work of an online auction compared with a classic tender procedure.

‘You have to be scrupulously fair at the auction and be in a position where you are buying in an absolute like-for-like basis,’ said Turner.

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