Three Ways for Nonprofits to Find

Cost-Efficiencies in the Next Year

Make procurement top-of-mind and open up budget to support your organization’s mission

A stitch in time saves nine, they say, and that will really make a difference in any budget of any size. By looking at the previous year’s spend and partnering with suppliers, nonprofits can start planning ahead to see how to make those budgeted dollars go further. 

According to the National Council of Nonprofits, 97 percent of nonprofit organizations nationwide have an annual budget of less than $5 million, and 92 percent operate with less than $1 million. For nonprofits, every dollar counts — and every minute counts. In the mission-focused and resource-strapped world of nonprofits, procurement and purchasing can often become afterthoughts. Still, organizations can flex their budgets wider the following year by taking a retrospective overview of their spend.

Lean into Supplier Relationships

Negotiating discounts — or taking advantage of discounts that are already available because of the quantity involved — is a great way to not only get what you need but also to identify potential long-term suppliers. Over time, these supplier connections can sometimes result in additional discounts and better customer service (it is, after all, a relationship — and good relationships are maintained through goodwill). 

A few years ago, the Sundance Institute needed to ship more than 800 film-festival gear packs to volunteers and staff all over the world. The organization turned to Amazon Business to make their shipping dollars go farther and track the gear to ensure it arrived on time and in one piece. “Amazon Business allowed us to lean on them and rely on their expertise to send these packages out,” says Brian Marquez, a senior manager for Sundance, “so we could better focus on ensuring our staff and volunteers were ready to go for Day 1.”

By using their buying power, nonprofits like Sundance can drive costs per unit down by buying lots of units in accordance with their planned spend for the year — whether that’s festival gear or something else. Less time spent on logistics and less waste in the process means more time to focus on program delivery. 

Find a supplier who is more like a trusted partner than a vendor. The right supplier can help you better strategically manage your organization’s procurement, allowing better planning for spend on materials, resources, and supplies for the upcoming year.

Support your organization’s mission by choosing the right procurement hubs. Digital procurement hubs that inform you about a potential supplier’s environmental profile can help nonprofits be better stewards of the environment. By creating the parameters for selective purchases, they can help you ensure that products with preferred sustainability certifications float to the top of a search. Buying more-sustainable products and reducing waste through less packaging has tangible benefits, and it has never been easier with third-party certifications and climate pledges that are prominently displayed and easy to identify.

Consolidate Your “Spend” 

Friends are more valuable to us than acquaintances: you can get more of what matters from one deep and abiding friendship than you can out of a dozen people you loosely know. By consolidating your organization’s spend and contracting with fewer suppliers who can satisfy your needs, you are likely to get more out of them — more in terms of savings, more in terms of favorable terms, and more in terms of customer service when you need it most.

With 250 locations worldwide, the USO’s mission to serve our women and men in uniform and their families is not only critical, but also logistically complex. As part of a bigger project to incorporate several independent charters under the corporate umbrella, the USO’s procurement goal was to centralize operations to consolidate suppliers, achieve more competitive pricing, and create efficiencies. 

They turned to a unified procurement hub to help them with that transformation. Through a new automation process, the USO was able to slash the amount of time it took to process orders by half or more. Now, all users across the organization have access to e-commerce sources for their unique needs without searching through individual supplier catalogs. Using Amazon Business’ Approval Workflows, USO users (now numbering about 300 organizations) can create, and quickly scale purchasing workflows that fit their organization's structure.

“While the introduction of this new process is a big, structural change for the organization, most everyone has now embraced it,” says Rick Quaintance, a procurement co-lead at USO. Quaintance and his colleagues enabled a punchout — a technology solution that allows the USO to source supplies from one procurement platform through a business spend management software. “Things like approving invoices and reconciling receipts for expenses used to take five to seven days, and now it takes two,” he says. “What used to be a manual process that took up much of our time is now almost entirely automated.”

Build Efficient Systems to Support Purchasing

Nonprofits can reinvest in their missions many of ways, including better technology, targeted marketing campaigns, capacity-building through talent acquisition and staff training, and external partnerships that allow you to tap resources and amplify your efforts. All of this amounts to creating a unified system that supports the mission and the future activities of a nonprofit — ultimately saving precious time in the long run. 

Toys for Kids started in 1995 as a nonprofit laser-focused on collecting donations and purchasing toys for 300 Seattle-area children experiencing homelessness. By 2019, they had raised over $700,000 for 33 agencies that serve kids in Seattle and beyond. For Toys for Kids, toy purchasing is the foundation for the organization’s legacy. 

The death of their co-founder coincided with a national trend, however, of brick-and-mortar toy stores shuttering is partly due to the prevalence of e-commerce — and Toys for Kids found itself looking for toys to buy online more and more. To modernize, Toys for Kids turned to a procurement platform as a strategic partner and supplier to expand its operation by offering scholarships and procuring school supplies, school meals, and more for children in need.

Plan Ahead with the Help of Your Partners

When thinking about your strategic priorities for the upcoming holidays and for the upcoming year, one of the best tactics you can do right now is to initiate conversations with your suppliers. Share what you’re planning for the year and collaborate with them as partners.

When organizations like USO, Sundance, and Toys for Kids needed to transform their procurement process, they found a supplier that could be more than a vendor and could serve as a trusted partner. It’s how they, like hundreds of other nonprofits, found efficiencies and better deals, especially on bulk orders — when time was tight and every dollar mattered. 

B2B procurement hubs like Amazon Business and others are trusted by lots of nonprofits who now see procurement as more than a function of their finance teams. They see procurement as a key strategy to advance the missions of their organizations. 

This content was paid for and created by Amazon Business. The editorial staff at The Chronicle had no role in its preparation. Find out more about paid content.