Lynx Purchasing: Getting better value out of budgets is an operational imperative
To survive and thrive, schools need to get the most from every penny they spend, yet every organisation loses thousands of pounds annually through poor purchasing choices and costly old habits. Lynx Purchasing explains how you stop it.
As heads, governors and senior leadership teams are well aware, school finances are facing unprecedented pressures. Rising costs in all areas from utilities to food, staffing, business rates plus a further drain on budgets from increased training and government legislation are forcing schools to rethink how they operate. In fact the number one challenge for senior leaders in schools today is: how do I get more out of budgets that are shrinking in real terms?
There is little any school can do to change global factors, international supply chains and domestic legislation. But that does not mean you are helpless. Opportunities for controlling your organisation’s costs through better management of your purchasing exist - and this will release more funds to spend elsewhere or mean a return to profitability.
The only way to start is by going back to school, reviewing all of your costs and adjusting mindsets to regard seeking better value as an operational imperative, not just an academic exercise.
There’s no blame or shame here. Times have simply changed and purchasing has become much more complex. Your school team needs to learn new ways of organising purchasing and preferably have a strategy - that way you’ll rid your operation of costly bad purchasing habits - such as last-minute buying from Amazon - and create a better buying culture that will increase all-round efficiency and ensure you get maximum value from budgets whatever the economic cycle.
As Inspired Learning Group’s group operations manager Garth Wray explains: “It’s not so much that the education sector has been complacent about purchasing in the past, but perhaps more that our priorities now need to change. For example, in hospitality, the first thing a chef does when planning a menu is work out what their gross margin is going to be and so they are very cost sensitive. As there is less price sensitivity in education, chefs have been less reactive to cost changes, but things have changed and we all need to get much better at it.”
Garth has drawn on his background in the hospitality sector to achieve substantial savings for his school group across a broad range of products and services. Inspired Learning Group (ILG) currently operates in 32 settings, from mainstream independent schools to nurseries and special educational needs’ units. Working with purchasing specialist Lynx Purchasing, Garth has systematically audited buying costs across the group.
He adds: “Implementing changes in so many purchasing areas is a complex process, and not necessarily something I’d have time to do myself. Lynx Purchasing brings purchasing experience and expertise to the process, and understands the specific needs of our business rather than taking a one-size-fits-all approach to purchasing.
“Like all independent schools, we’ve faced the triple whammy of the increased minimum wage, higher employer NI contributions, and the addition of VAT on fees; and also like everyone, our three biggest costs are our people, followed by food and drink, and then utilities.”
As ILG expanded, it had ‘inherited’ a range of different contracts and agreements. Lynx’s purchasing specialists audited ILG site by site, and by changing the main food supplier to the group, achieved average savings of 10% with no impact on food quality.
“In addition, we were paying a percentage fee on every invoice to our previous procurement company. With Lynx’s no-contract, no-fee model, that amounts to additional very significant savings for us,” says Garth. “The no-contract model also means that we’re free to switch suppliers if we need to. We’d previously found ourselves tied into contracts with food suppliers who couldn’t always meet our needs.”
On utilities, Lynx Purchasing has been able to negotiate new agreements at a number of ILG’s locations, achieving average savings of 30%, with plans to continue putting new utilities deals in place as existing contracts expire.
ILG is also seeing savings in a range of other purchasing areas through its partnership with Lynx. The group will achieve savings amounting to hundreds of thousands of pounds on printing and copying costs through a new five-year agreement, with the savings increasing as more sites switch.
Additionally, savings on stationery and education supplies are averaging 12% per site, while significant savings are also being achieved in areas such as chemicals, disposables, lighting, and even mattresses.
“We’re also seeing improvements in compliance and sustainability in some of these areas,” says Garth, “and crucially this is all being achieved without any compromise on product quality or standards.
“We’re already achieving significant savings across the group, and we expect that to continue as we expand, as more existing contracts end, and as we work with Lynx to identify more areas where we can make purchasing savings,”
Working with the right suppliers for your organisation can ease the pressure as can purchasing experts such as Lynx Purchasing.
Our team works with a significant number of schools and education providers in all categories and we understand the issues facing the sector, both day-to-day and strategic.
For more on how we can help independent schools and academies, please call us on 01325 710143 or email us on [email protected]
Find out more about how we work at lynxpurchasing.co.uk and download our insight guide to better managing school budgets and buying - Back to School. It’s free.
Lynx Purchasing is an ISA Gold Preferred Supplier.
