Recession Negative, Procurement Positive

From Buyers Manual

There has been a lot of doom and gloom in the press recently regarding spending cuts, VAT rises, fuel costs and inflation, which is affecting nearly every single one of us, but there is always a chance to see the silver lining.

Despite Labour’s concerns, Chancellor George Osbourne said, that the VAT rise was a “tough but necessary step towards Britain’s economic recovery” he added, “VAT is a powerful weapon to tackle debt.” Therefore if VAT did not increase there may have to be further spending cuts in other public sector areas such as the NHS and education.Independant.co.uk

Buyers in the public sector have an increasingly tight budget resulting in the money from the public purse being stretched as far as possible.

The current economic climate is not a chance to take things lying down but a chance to use the current recession as an advantage. For buyers in the public sector it is the right time to purchase goods and services because suppliers’ profit margins are low to encourage trade and keep their businesses afloat. This results in some suppliers offering lower prices and better value for money, which is good news when only a small budget is available.

During the recession suppliers may respond to more tenders than usual to increase their trade and customer base, therefore, when a buyer advertises a tender it may be viewed more resulting in more responses and an overall better offer for the buyers. With many suppliers willing to absorb the VAT increase and keep profits low for this difficult time, it is still possible for buyers to get the best value for money during the recession.