MOD team helps make £100 million Government saving

A DE&S project team has combined MoD’s office supplies requirement with those of eight other Government departments in the biggest ever public sector reverse auction to generate combined savings over existing spending of £100M over the next four years.

MoD combined its own office supplies requirement with Her Majesty’s Revenue and Customs, Home Office, Dept of Constitutional Affairs, Metropolitan Police, Foreign and Commonwealth Office, HM Treasury, Office of Government Commerce and HM Prison Service to generate the savings.

This collaboration has resulted in extraordinary savings in the procurement of office supplies; a saving to the MoD alone of £50million over the span of the contract.

MoD officials in Defence Equipment and Support realised that several MoD office supplies contracts were due to end this September and decided to combine all the planned purchases to maximise leverage with suppliers.

The Office of Government Commerce, which became involved from the outset, saw an opportunity for collaboration between government departments to increase Efficiency.

The MoD DE&S Office Supplies Category Management Team commissioned the services of Group Supplies Ltd to structure a commercial tender process and hold the reverse auction.

The company advised MoD to split the contract and undertake four auctions on sequential days with the £110 million stationery supplies requirement being completed on the first day.

Grant Morris, MoD Director, General Commercial (Project Delivery) who watched the event, said:

“I am delighted with the result and thank all of those involved for their support in delivering this exceptional commercial result.”

From 1st October 2007, stationery will be supplied by Lyreco Uk Ltd, paper will be supplied by Office Depot UK Ltd and Westcoast Ltd trading as Orion Media Marketing will supply magnetic media and electronic office supplies under contracts totalling £132 million.

Dr Philip Mason, who headed the Group Supplies team tasked with delivering the services, said:

“Group Supplies are proud to have been entrusted with this complex and prestigious project which allowed us to demonstrate to the MoD the added value we can bring with our commercial approach.”
This complex competition was the largest and most successful Public Sector reverse auction achieving the greatest saving ever using an auction process. The 2,432 bids was the highest number of bids in a single auction, there was the longest extension period of 13 hours and 45 minutes. The auction also produced the highest saving per hour at a single auction of £6.4 million per hour