Philadelphia is trying to make its buying process faster and cheaper
The city buys $3 billion worth of goods and services every year.
Standing in a conference room in Philadelphia’s Municipal Services Building, Christine Derenick-Lopez, the city’s first deputy chief administrative officer, drops a cardboard box, filled with papers, onto a table.
It’s one company’s bid for a public works contract with the city.
“On average, we get about five bids for a public works opportunity,” Derenick-Lopez said. “This is one of them, and this is how it’s delivered to the procurement department.”
Derenick-Lopez is leading a charge to save money and time when Philadelphia buys things.
When companies try to win most types of contracts with the city, they can’t submit their bids online. Instead, they have to send their proposals in boxes.
That’s why the city is now rolling out an online platform where vendors will submit their bids. Companies can register now, and the city expects online bidding to start in November. Starting in 2017, companies will submit all their bids online.
Philadelphia will also start using electronic signatures to speed up approvals on its professional services contracts by up to 45 days.
Other improvements in the procurement process are needed, too, Derenick-Lopez says. Right now, there’s no single place for companies to see all the city’s contracting opportunities. Instead, there are six different websites.
“So if you’re a vendor, and you want to see some opportunities because you want to do business with the city of Philadelphia, you would need to know whether it was a [request for proposal], or a bid, or a supply to decide what website to go to,” she said.
To remedy that, the city is launching a site called Contracts Hub that’ll act as a point of entry.
“Contracts Hub is essentially going to scrape all those different websites, and under one site, you can see every single contractual opportunity in the city of Philadelphia,” she said. Companies will be able to search by keyword and set up alerts.
The city is also making internal changes so it can pay vendors faster. And it’s launching a reverse auction system for certain contracts.
The fact that Philly is just doing these things now might make it seem a little behind the times. But a spokesperson said the city is in the middle of the pack with respect to other cities in the U.S. when it comes to putting these purchasing systems in place.
These new systems will cost up to $300,000 a year. But the city expects to save far more. It says the changes will likely save vendors money, too.
And the hope is, that’ll make it easier for businesses — specifically those owned by Philadelphia residents, women, and people of color — to work with the city. The mayor has said it’s a priority for the city to work with those groups more.
“If we can get more local, minority, [and] women-owned businesses to be able to do business with us, that could spur the local economy,” said Rebecca Rhynhart, the city’s chief administrative officer. “We’re really looking at this as a great opportunity to move the city forward.”
There would be another benefit to enticing more companies to bid on city contracts. In the 2016 fiscal year, the city only got about two bids, on average, for each supply and equipment contract below a quarter of a million dollars.
“For the taxpayers, that doesn’t say efficiency, right?” Rhynhart said. “We need to change that.”
Big picture, the city’s hoping that all of these changes will bring more companies to the table — which will drive down prices on the many things Philadelphia buys.
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