Answer: First I would like to thank you for bringing this site to my attention. And yes this site appears to satisfy most my reasons for recommending centralized purchasing. This site has the potential of bringing major savings to State and local budgets as its membership grows. There is more savings than may appear over state centralized purchasing which may require a centralized computer system within the state and in some cases distribution centers. This organization uses a drop-ship method directly from the manufacturer to the purchaser this is much simpler solution.

The key to the success of US Communities is in its management. You will recall from my other articles that I recommend aggressive negotiation a tactic fully developed by Walmart. In fact I recommended that Walmart be used as a guide and as a standard for success. As the membership in Us Communities grows so will its power to negotiate volume purchases and bring significant savings to its members. Us Communities must be able predict and track purchase volumes through its computer system to enhance its negotiation capabilities. If US Communities did not negotiate for lower prices then there would be little advantage for joining.

I would recommend that each state review the Us Communities web site and confer with its management about its purpose and how it operates. If approved by the state then state should recommend that all purchases throughout the state be made through Us Communities. This will significantly increase the Us Communities’ purchasing volume and its power to negotiate lower prices.

Us Communities purchasing involves mostly office and school supplies. Note that I have recommended that a national organization of states be setup to purchase Medicare prescription drugs. Where volume purchases would reduce the purchase costs similar to those savings found in Canadian Pharmacies. This is a significantly different business from what Us Communities is currently doing and will probably involve an entirely separate organization.

Another related recommendation is the coalition of several states in the purchase energy. I don’t recommend that this be a National effort because of the unique regional energy delivery systems of each State. Western States such as California, Washington, Oregon and others should combine their purchases of energy and purchase directly from suppliers rather than through brokers like Enron. The same recommendation can be made for New England states.