Date published: 01.09.08 - not release date

London Borough of Newham, Host to the 2012 Olympics, Adopts EGS’ e-Procurement System and Deploys in Just Six Weeks

2,500 Suppliers and 50% of Local Authority’s £300 Million Annual Budget to Pass Through EGS’ IDeA:Marketplace Once Fully Deployed

EGS Ltd, the UK’s largest and fastest growing ecommerce Exchange for the public sector and its suppliers, today announced that the London Borough of Newham has adopted its e-Procurement and electronic trading environment for local government, known as the IDeA:marketplace. The London Borough of Newham was one of the early pioneers of electronic trading and the 1st local authority in the UK to implement an electronic environment. The EGS system, which went live in just six weeks, replaces an existing e-Procurement technology that has come to the end of its contractual agreement.

With an annual spend of over £300 million and more than 2,500 suppliers, the Council raises approximately 150,000 purchase orders a year.

“We initially implemented e-Procurement technology back in 2001 in a five year agreement and we were the 1st local authority to adopt an electronic marketplace model,” said Martin Scarfe, Financial Advisor for the London Borough of Newham and board member of the National e-Procurement Project (NePP). “As part of my role in the NePP, we look at e-Procurement for all English local authorities and are familiar with the vendors and solutions in the market. We felt EGS’ IDeA:marketplace was the best fit for us. It is tried and tested technology, has a large number of local authorities already using it, as well as a large number of suppliers. We felt quite strongly that whilst there are plenty of other vendors in the market with good e-Procurement systems, there's really only one that provides a ready made solution for both local authorities and suppliers alike, which is why we adopted EGS’ Exchange.”

Approximately 150 buyers within the Council are now live and a total of 250 buyers throughout the organisation will join the EGS Exchange with every major department enabled to buy online. So far about £3 million of high volume transactions are passing through the Exchange with up to half of the Council’s £300 million budget expected to follow over time.

“We went from kick off to set up and initial deployment in just six weeks, which reflects the ease of use,” added Scarfe. “We trained 100 people in a traditional classroom style environment, but then moved to online training, which means our staff can now get trained without any manual intervention.”

The 2012 Olympic Games and Paralympic Games are speeding up regeneration in Newham, East London and the Thames Gateway, and it is the Olympic Delivery Authority’s money that is funding the London Games. Once the Games are over, it will be the Council’s responsibility to maintain the infrastructure that supports the Olympic stadium, such as the new roads, accommodation and new transport links in the borough through relationships with local suppliers. It is this expenditure that will be handled through the EGS Exchange moving forward.

In addition to all of the usual benefits to be gained from e-Procurement, such as increased procurement efficiencies, collaboration, and assurance of on contract spending, the Council found EGS’ IDeA:marketplace has had a significant impact on reducing error rates.

“We were already automated with our purchasing as we were using a different e-Procurement system previously,” said Scarfe. “We did our own internal benchmarks and found that when an order goes right it was costing us about £12 to process from procurement through to invoice. With the EGS Exchange, that figure has dropped down to just £2, which is significant savings on 150,000 purchase orders a year. We also found that we had a fairly significant error rate of about 9% on orders to contracted suppliers as a result of people writing up the wrong order or suppliers not receiving it. With the EGS Exchange our suppliers tell us this figure has dropped down to just 1%, which is not only saving us money and time, but making our contract renegotiations much easier.”

Designed and managed by EGS specifically for local government, the IDeA:marketplace gives instant access to a wide range of contracts for products and services that have been negotiated locally, regionally, or nationally. The IDeA:marketplace is a joint venture between EGS and the Improvement and Development Agency (IDeA) to deliver local government's own electronic world-class procurement system and electronic trading environment. The IDeA:marketplace provides local government customers with a range of e-procurement solutions and services that meet their own needs as Councils, whilst enabling them to work more closely and effectively with other bodies at local, regional and national levels. Over 100 Local Authorities are currently part of IDeA:marketplace, and 150 public sector buying organisations use this and EGS’ other exchanges.

Buyers in the UK public sector raise over 50 million purchase orders per year and suppliers post over 100 million invoices per year. Shared Service ecommerce environments help dramatically reduce the costs of these processes and underpin collaboration between groups of public sector bodies to get the best from national, regional and local collaboration. There's £100 billion of e-procureable spend in the public sector every year. The combined efficiencies of business process cost savings and e-Procurement cost savings delivered by EGS have the potential to save the public purse well over £1 billion per annum. The solutions also offer major cost savings for suppliers. With almost one million online catalog items (the largest available), EGS Exchanges also have the potential to reduce the unit price of goods and services by as much as 30 per cent.

About EGS Ltd

Founded in 2000, EGS Ltd is the UK’s leading supplier of ecommerce Exchanges for the public sector. The company’s Shared Service ecommerce solutions are used by over 150 public sector buying organisations. EGS operates a series of inter-locking regional and sector focused ecommerce exchanges, providing services designed to automate and reduce the costs and timescales associated with the procurement to pay lifecycle. The services save considerable time and cost for both buying organisations and suppliers alike. EGS is the biggest and fastest growing ecommerce Exchange for the UK public sector with more than 50% market share, making it the market leader in its field, and the most successful Exchange of its kind in Europe. With the largest Shared Services customer base, EGS has 150 public buying organisations linking with 30,000 of their chosen supplies and the main contracts from Public Purchasing Consortia. Electronic purchasing is taking off. EGS has seen a 500% growth in the use of its services in past two years alone, and expects the trend to continue.

For further info, contact:

Vanessa Land
Devonshire Marketing
Tel: +44 (0)870 242 7469
Email: vanessa@devonshiremarketing.com