Mohave | Mohave Value

Page Updated 1/5/12

Using Mohave Contracts Provides Value
An Analysis of the Value Provided By Mohave’s Statewide Cooperative Purchasing Program

The purpose of this study is to demonstrate the value realized through use of Mohave’s cooperative purchasing program. Mohave and ASPIN members realize value from a variety of time and cost savings for procurement, contract administration, order management, increased efficiency, improved performance, and lower cost of goods and services. This study analyzes the value of factors other than the cost of products and services.

Value may be realized through actual savings or through avoided time and cost. Value through avoided cost means that requirements are successfully met without the normal time and money investment.

A summary of value received from the use of Mohave contracts is provided below. To substantiate that value, examples of actual or avoided cost are provided after the summary.

Using Mohave contracts provides value through…

Procurement time & cost savings
Procurement efficiency
Protest and appeal resolution
Contract administration
Order review
Internal audit
Outreach & education

Using Mohave contracts provides value because…

Mohave conducts the procurement
Staff increases and overtime are reduced because fewer inhouse procurements are required
Staff has more time to conduct procurements better accomplished inhouse
Non-purchasing personnel can effectively assist with procurement
Goods and services can be ordered immediately and received sooner
It is not necessary to monitor aggregate purchases because all contracts are competitively procured
Resource costs are reduced (postage, copying, paper and other costs)
Members have fewer solicitations to review for due diligence
Vendors respond to fewer solicitations resulting in less overhead cost to be recovered via sales
Multiple award solicitations enable vendors to spend more time with the customer
Common contracts used by multiple agencies result in fewer errors and omissions
Mohave resolves all protests and appeals tied to Mohave solicitations
Mohave administers the contracts
Mohave reviews orders to assist with contract compliance and accuracy
Mohave assists in resolving order problems
Mohave internal audit assists in identifying and correcting errors and omissions
Mohave’s identification of errors and omissions helps reduce member audit findings
Mohave trains vendors to market their contracts properly
Mohave trains members to effectively and efficiently use contracts
Mohave provides readily available web-based resources
Mohave uses a variety of tools to obtain information and keep members informed

Quantified examples of value received through the use of Mohave contracts are provided below. Savings estimates are based upon actual and sample data. The examples are not a complete list of the value members realize when they use Mohave contracts.

Using Mohave contracts provides value through procurement time & cost savings

Members save time and money when Mohave conducts the procurement. In 2008, 278 buying members used an average of 9 Mohave contracts each.
On average, competitive sealed bidding requires 56 labor hours costing $1,484. Competitive sealed proposals require 79 hours costing $2,913. In 2008, Mohave contracts provided an equivalent procurement time and cost savings of 608 hours and $19,791 per buying member.

Using Mohave contracts provides value through procurement efficiency
Examples of procurement efficiency from use of Mohave contracts

Each Mohave procurement produces contracts for 360+ entities.
In 2008, 278 members used an average of 9 contracts each. Up to 2,502 member contracts may have been required to duplicate the procurement.
In 2008, 11 multiple awarded solicitations resulted in 38 term contracts for 360+ entities.

Using Mohave contracts provides value through protest and appeal resolution

Protests and appeals are serious procurement matters, which Mohave resolves without any delay or direct cost to members.
In 2008, resolution of 4 protests provided an equivalent member savings of 32 hours and $2,240. Over the past five years, resolution of 3 appeals provided an equivalent member savings of 186 hours and $24,894.

Using Mohave contracts provides value through contract administration

Mohave administers 160+ contracts, saving time and money for all of Mohave’s 360+ members.
In 2008, Mohave administered 3,000 price updates, amended 145 contracts to comply with new legislation, and helped two members coordinate with a surety to complete defaulted projects, providing an equivalent member savings of 981 hours and $31,987.
ASPIN’s management of invoices and payments results in quick pay and volume discounts for members.
In the first 8 months of FY2009, ASPIN processed 25,878 invoices providing an actual savings of $617,899 in quick pay and volume discounts. Using Mohave contracts provides value through member order review.
Mohave and ASPIN review all orders. We notify members and vendors of problems and corrective actions, and ensure corrective action is taken, saving members time and money.
In 2008, Mohave identified and corrected 2,482 problem orders, providing an equivalent member savings of 1,241 hours and $39,327.
Over a 40-week period, ASPIN invested approximately 11.25 hours per week correcting problem orders, providing an equivalent member savings of 450 hours and $14,260. Using Mohave contracts provides value through internal audit.
Mohave audits selected contracts, helping ensure that purchases comply with the contracts. Errors are reported and corrected.
In 2008, Mohave’s audit of 43 contracts provided an equivalent member savings of 1,440 hours and $45,634. Audit findings resulted in member credits of $12,220.

Using Mohave contracts provides value through outreach and education

Mohave provides member and vendor training, and surveys members and vendors to measure vendor performance, Mohave performance, and satisfaction with Mohave contracts.
In 2008, select outreach and education activities provided an equivalent member savings of 101 hours and $2,619.