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Due Diligence

The widespread acceptance of cooperative contracts as a purchasing best practice has delivered benefits to procurement professionals through increase competition and a variety of choices. The consequences of these numerous choices are confusion and questions about what the best options may be for your organization. Not only do cooperatives vary, but processes for contracts within a cooperative can vary.

Introducing ProcureSource. We provide the information that enables you to make an informed decision. With our due diligence guidelines and contract details, you’ll be able to identify if a cooperative utilizes processes that meet public procurement standards, has sufficient oversight, and employs compliance mechanisms or quality controls.

How do you perform proper due diligence across a dozen cooperative options and still retain the time and administrative benefits of cooperative purchasing? Use the ProcureSource Due Diligence Guidelines to streamline this process and evaluate four key areas. ProcureSource encourages purchasing professionals to conduct your due diligence at the contract level, not just the cooperative. Download print-friendly version.

Solicitation, Evaluation and Award
  1. Was the issuing entity and awarding entity of the solicitation an independent lead public agency that meets the standard definition of a political subdivision (county, city, school district, state, public higher education or special district) and therefore meets the cooperative purchasing legal criteria in all states where cooperative purchasing is permitted?     
  2. Was the development of the solicitation, evaluation of the responses and award determination all performed by public employees of a political subdivision that is separate from and independent of the cooperative organization?    
  3. Are all solicitations for the cooperative performed by a variety of independent public agencies?    
  4. Was the procurement process substantially similar to the process your agency is required to use?    
Oversight of the Cooperative
  1. Does the cooperative organization have independent and broad oversight of the program and its operations?     
  2. Does each solicitation, evaluation and award process incorporate the participation and oversight of public procurement professionals from multiple public agencies?    
  3. Was the solicitation performed by a lead agency that utilizes the products and services it is soliciting for in normal operation of the agency?     
Contract Compliance Processes and Programs
  1. Does the cooperative organization conduct independent third-party supplier audits to ensure contract compliance?    
  2. Does the cooperative organization have adequate staff relative to the number of awarded suppliers?     
  3. Does the cooperative organization’s staff conduct quarterly performance reviews with supplier executives and lead agency to evaluate performance and compliance?  
Contract Volume & Quality
  1. Does the cooperative organization’s agreement contain terms and conditions that require the supplier to provide their best government pricing to your agency?    
  2. Is the amount procured through the contract significant?      
  3. How competitive was the award process? Were awards to a limited number of highly competitive responses?