Small Portfolios Can Save Big through Multifamily Group Purchasing
A spend management strategy that includes group purchasing is good business, even for small multifamily housing portfolios. Group purchasing unites the buying power of many smaller PMCs to win negotiated savings from a catalogue of top multifamily vendors.
The value is the same for properties of just a hundred or so apartment units as it is for a portfolio of high-density communities.
Apartment operators face stiffer challenges today managing expenses and must harness every advantage available. Group purchasing offers competitive advantages while assuring properties that they are spending wisely.
A good group purchasing organization (GPO) fully vets participating companies and negotiates pricing on hundreds of products necessary to keep today’s apartments running at lower costs. Vendors have proven reputations and are typically among the most reputable in the industry.
It’s a classic example of strength in numbers, says RealPage Director of Vendor Management Jennifer Lester. And it’s an important asset for smaller rental properties that may not have a dedicated purchasing staff or procurement manager.
“Working with a GPO enables a property of any size to efficiently purchase and capture savings every day of the year,” she says. “Operators can get control of spending and peace of mind, even if their purchasing resources are limited.”
Properties also enjoy the benefit of knowing that more of their purchases are from known, reliable and vetted vendors, reducing the rogue spending that can lead to a variety of problems.
Tapping into a strategic vendor network
Vendor relationships are more important than ever. The pandemic has altered the way many companies purchase products, and risks have grown as some vendors struggle to stay afloat.
According to a recent report by the National Leased Housing Association, low- and moderate-income housing providers experienced double-digit declines in revenue and nearly a 15% increase in operating expenses as the economy tightened in 2020. Personal protective equipment and cleaning supplies were limited and expensive; some still are.
RealPage® eSupply GPO clients, however, have a key advantage. They can tap into a strategic marketplace of vendors who maintain steady inventories and have more resources to consistently stock the essentials at the best prices.
“You’re dealing with some of the largest and most established companies in the marketplace,” says Lester. “These are companies that are built to last and property management companies of all sizes can utilize these resources and save immediately.”
Combined purchasing power enables multifamily properties to reduce sourcing and procurement expenses. The strategy is an effective way for small properties to get big savings to kick off 2021.
Start saving immediately with eSupply group purchasing
RealPage® eSupply GPO helps properties quickly and easily save with no out-of-pocket expense.
eSupply GPO is a free service that offers pre-negotiated discounts through a select group of vendors who provide services and handle products specific to the apartment industry. The vendor list has been narrowed to provide clients a fast, effective way to save rather than have to manage multiple supply partners.
“Using multiple vendors can often be more expensive than spending with a preferred vendor and maybe one other,” Lester says. “Narrowing vendors can lower costs through volume pricing and help achieve additional savings in the form of rebates that wouldn’t be achievable through dealing with multiple partners.”
Clients can always take advantage of pre-negotiated pricing as well as any deals they have in place before onboarding. To keep track of spending, detailed analytics reports offer complete visibility and transparency into total savings achieved.
Since eSupply integrates with RealPage Spend Management solutions, discounts are automatically applied when shopping from the spend management catalogue.
An account manager is assigned to each client to help establish, organize and maintain a preferred vendor network. The setup is easy; it takes less than 15 minutes and clients begin saving the very first day.
“Our group purchasing program encourages properties to buy from approved vendors to ensure compliance and maximum savings for your organization,” Lester says. “As a result, you can reduce sourcing and procurement expenses as well as free up more time to focus on your residents.”
If you’re lacking a purchasing staff, questioning product purchases at your properties, or wanting to close the gap between real and potential savings, eSupply GPO is the key to realizing more profitable business results. Email us to learn and save more today!