GPOs are organizations that allow businesses to band together and purchase goods and services as a group and get a much better price on whatever they’re purchasing. GPOs can be useful for both small and large businesses, and there are a variety of different types of GPOs available.
Regardless of the type of goods or services a business is looking to purchase, there is likely a GPO out there that specializes in what it needs. Some industry-specific organizations have been known to create their own GPOs. If you’re a business owner looking to take advantage of group purchasing, you should consider joining your regional or industry’s GPO. To help you understand this concept more thoroughly, here are some of the most common types of GPOs and how they can benefit businesses.
What Are GPOs?
A Group Purchasing Organization, or GPO, is a consortium of businesses that work together to get a lower price on goods and services. Typically, a group purchasing organization will have a variety of members, from small businesses to large enterprises. By banding together, these businesses can negotiate better prices with vendors and suppliers. In some cases, the GPO may even have the ability to create its contracts with suppliers, which can give members an edge over those who don’t belong to the group.
Many businesses find that joining a GPO is a cost-effective way to purchase items such as office supplies, technology, and even services like shipping and telecommunications. GPOs can also be beneficial for industries that have specific needs, such as healthcare or manufacturing.
Types of GPOs
There are a variety of different types of GPOs, each with its advantages and benefits. Depending on the type of business you have and your need, there’s likely a GPO that’s a perfect fit for you. Here are some of the most common types:
Regional GPOs
Regional GPOs are organizations that cover a specific geographic region. This type of GPO is ideal for businesses that want to purchase goods and services within a certain area. For instance, if your business is located in New Jersey, joining a GPO that specializes in purchasing goods and services for businesses within the state will give you the best deals.
Industry-Specific GPOs
Industry-specific GPOs are groups that focus on a specific industry, such as healthcare or manufacturing. These organizations offer products and services tailored to the needs of their industry members. That means that if you’re a business owner in the healthcare industry, you can join a GPO that specializes in providing healthcare-related goods and services. This can be a great way to get the best prices on medical products and services as well as general business goods.
National GPOs
National GPOs are the largest type of GPO, and they cover the entire country. This type of GPO is ideal for businesses that need to purchase goods or services from suppliers located all over the country. The main difference between a regional GPO and a national one is the fact that national GPOs can work with larger companies, while regional GPOs typically work with businesses that have fewer than 500 employees.
Global GPOs
Global GPOs are organizations that specialize in purchasing goods and services from suppliers around the world. This type of GPO is perfect for big companies that want to source products or services from a variety of different countries. For example, if you’re a U.S.-based business that needs to purchase parts from Asia, joining a global GPO would ensure that you get the best prices on those parts.
Benefits Of Joining A GPO
One of the main reasons businesses join GPOs is to get lower prices on the products and services they need. By banding together, businesses can negotiate better prices with vendors and suppliers. Businesses that don’t belong to a group often have to pay higher prices, so joining a GPO can be one of the most cost-effective ways to get lower prices on all sorts of goods and services. Many GPOs are partnered with exclusive suppliers who offer deals exclusively for members. This way, you will be able to save money while still getting everything you need.
In addition to getting lower prices, when businesses join a GPO, they often see an increase in efficiency thanks to the streamlined purchasing process. It’s much easier to place a single order for a group of companies than to contact several different suppliers on your own. In addition, GPOs tend to have exclusive contract arrangements with vendors and suppliers, which can give members an edge over those who don’t belong. This makes it easier for businesses to get a priority status among their competition.
Joining a GPO can also lead to increased opportunities for your business as well. Since you’re already affiliated with other businesses, this may help you to gain new clients and grow your customer base. If you’re an emerging company looking for new partnerships, joining a GPO could be one of the best ways to gain access to needed goods and services at better prices.
How To Join A GPO?
If you think that joining aO could benefit your business, you’ll need to figure out which GPO you want to join. It’s a good idea to do some research on different organizations in your area, as well as any industry-specific groups that may be available. Additionally, you can check with local and state businesses for recommendations on the best GPOs in your area.
Once you decide on a few GPOs that could work for your business, you’ll need to contact them directly to find out how to get more information about becoming a member. Joining these organizations is relatively easy since most only require basic information from members such as employee number or annual revenue. You’ll then usually have the opportunity to talk with someone from the organization about how it benefits businesses like yours while learning more about the types of goods and services they offer.
Now that you understand what GPOs are and some of the benefits of joining one, you’re ready to decide if this is something your business should explore. Remember, by banding together with other businesses, you’re able to get lower prices on products and services while still having access to exclusive deals and greater overall savings. So, if you’re looking for ways to save money, a GPO could be a great option for your company.
