2016 PURCO SA Annual Report

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2016 PURCO SA Annual Report

Another successful year has been recorded for PURCO SA in all key areas of operation. We have grown our membership and our ambit of services, and have enjoyed the increasing support of our members who are channelling more of their procurement budgets through our contracts..

PURCO SA Annual Report 2016

 

There are four key drivers of our success as a consortium of higher education institutions:

  1. the number of institutions that we count as members of our consortium, 
  2. the value of procurement spend that they commit to our contracts,
  3. the scope of supplier contracts we negotiate, 
  4. our skill and professionalism in identifying, negotiating and managing contracts.

Membership

During the past year we grew our membership to 46 institutions, with the acquisition of four TVET colleges. 

We already enjoy the membership of all public universities in South Africa and Namibia, as well as a number of private institutions.

Procurement spend

In the face of severe spending cutbacks in 2016, our members increased the volume of procurement spend they transact via PURCO SA negotiated contracts by 10.43%, to R1.5 billion. 

The bulk of this increase was derived from outsourced services such as security, catering and cleaning with TVET colleges. With universities busy insourcing these functions, these contract categories will be severely curtailed in the next fiscal.

Contracts under management

We increased the number of contracts under management to 573, with 433 suppliers. 

Our bulk purchasing tenders and contracts negotiated on behalf of members now cover a vast range of goods and services, and we are actively expanding the range as we proactively identify member needs.

Skills and professionalism

PURCO SA maintained our stable team of skilled staff during the year. Our managers and staff have deep insights into the higher education sector, and continue to deliver outstanding performance in the negotiation and management of goods and service contracts. 

Savings and rebates

The consequence of the the four performance drivers is reflected in the procurement savings that PURCO SA is able to achieve on behalf of our members. 

In 2016 savings increased to R139 million, up by 16.3% year on year.

In addition, we were able to distribute R18.5 million in rebates back to the membership, an annual increase of 46.8% over 2015.

Redefining our place

During 2016 we continued to diversify our services to augment our core focus of negotiating collaborative contracts. 

The three key areas of focus included procurement training for members, a skills development initiative for suppliers, and the implementation of our Consultancy Service. While positive feedback was received in respect of all three projects, we are especially pleased that our consulting arm has been received so positively by members.

In the year ahead PURCO SA will continue to refine and enhance the way in which we deliver our core mandate, while redefining the services we offer to members that augment that focus.