You are viewing 1 of your 1 free articles
Staff at social landlords under pressure to favour cost savings over quality in procurement
Cost savings are a bigger concern to procurement professionals working for UK social landlords and other public sector organisations than quality of work as pressure on budgets intensifies, new research has found.
A survey carried out by procurement company Fusion 21 found that while 39% of respondents said quality was an “extremely important” consideration during procurement activity, a larger proportion (47%) identified cost savings as being the most significant.
The survey results, provided exclusively to Inside Housing, represent the views of 100 procurement professionals who work for organisations such as housing associations and stock-owning local authorities, which collectively own more than one million homes. It is the second time the survey has been carried out.
Fusion 21’s inaugural report, published this time last year, found that more than half (51%) of respondents stated that quality had become a bigger consideration in their procurement decisions since the Grenfell Tower fire.
One procurement professional who works for a housing association said the shift towards cost savings was essential. “It’s short-term thinking, driven by budget cuts,” they explained. “It’s about getting as much done for as little [money] as possible.”
Another housing association director wrote: “Budgets are always stretched and we can’t always afford to pay for the quality we aspire to.”
READ MORE
More than half (59%) of procurement managers, directors and supply chain officers said they felt under pressure to procure at the lowest price, and 55% said they believe financial constraints have the biggest impact on their work and decision-making.
When asked what factors influence spending on property assets, the majority of respondents agreed that building compliance and safety works are the key priorities, with budgets being predominantly focused in these areas.
Compliance with procurement regulations, however, remains the most important consideration during procurement exercises, with almost three-quarters (72%) of all procurement professionals describing it as “extremely important”.
Sarah Rothwell, head of member engagement at Fusion 21, said: “Some contributors to this year’s research outlined how they achieve more with less by using spending power to insist on certain levels of quality.
“This is coupled with building relationships with potential suppliers to help secure long-term cost savings.”
