About Buying Groups

Questions worth asking by potential members and suppliers curious about starting a buying group. 

What is a buying group?

In its simplest form, a buying group is the coming together of similar independent businesses to leverage their combined purchasing power to receive better net costs and terms on the products they buy. Successful buying groups bring efficiencies to the supply chain rather than simply flexing their “market power” to extract a better deal. Efficiencies are created when Suppliers can rely on the buying group to perform functions more cost effectively for its Members as a buying group, than the current model of each Supplier dealing with each Independent separately. 

 

Buying groups are most often measured in improved input costs, but more importantly, as a place where best practices, peer-to-peer interaction is provided in a exclusive, respectful and inclusive environment. 

Why are buying groups needed?

  1. Buying groups level the playing field for smaller independents competing against larger regional and national / multi-nationals.

  2. Add value for both buyers and sellers by grouping small, spread out members into one cohesive entity.

  3. Allow independents to collectively execute more like larger players in their marketing, purchasing, payment, and rebates.

  4. Greatly reduce or eliminate geographic and size barriers for growth.

Why do independents join buying groups?

  1. Improved input costs not available to them on their own.

  2. Access to purchase direct from major suppliers not normally exposed to and supplier accounts unobtainable as an independent due to a supplier's customer criteria and account size.

  3. Ability to access peer-to-peer discussions on confidential business issues, but in a friendly capacity.

Why choose Buying Group Services?

Buying Group Services is 100% dedicated and specialized in starting and managing buying groups. Most independents are so occupied and focused on running their own businesses that they are unable to commit the required resources, time, and planning to start and operate a buying group.

 

When starting and managing a buying group, BGS has best practices to see what is best for the entire buying group, while any one individual is, by necessity, focused on their own individual needs.

 

Bringing far-flung and diverse independents to a place of collaboration is difficult to manage.  A motivated third-party working towards what is best for all parties involved in the buying group is incredibly valuable.

 

BGS does for the collective of independents what independents cannot effectively and efficiently do for themselves.

Why do suppliers join buying groups?

  1. A buying group does what it says it will do - delivers purchasing volumes in exchange for rebates.

  2. A buying group gives compelling incentives and encouragement for members to focus purchases to the group's suppliers.

  3. A buying group recognizes suppliers for their commitment to the group.

  4. A buying group allows access to the true decision makers in each member company.

  5. A buying group makes it easy for suppliers to do business with the members.