Kenneth F. Desowitz, C.P.M.Director of Supply Services

City of Los Angeles(213) 928-9557

kenneth.desowitz@lacity.org

LA City Overview

• Centralized Procurement of Commodities and Maintenance Services for transactions over $1000

• Over $400 million in purchases annually• 480 annual contracts• 3500 one-time po’s• 72,000 contract po’s• 17,500 blanket po’s under $1000

• Supply Services Division is responsible for Procurement, Inventory Management and Salvage Functions (150 staff currently)

• Dealing with budget shortfalls for the past several years• Recently lost 5 of 18 Procurement Staff to Proprietary

Departments due to promotions

Procurement Savings/Avoidance Form    PROCUREMENT ANALYST:      CONTRACT/P.O. NO.:           SUPPLIER:      SAVINGS/AVOIDANCE METHOD USED: Value Analysis (i.e. annual fee vs. time & materials maintenance) New source discovered (new supplier discovered other than suggested supplier or from the

supplier database list) Market research (i.e. competitive bidding vs. contract renewal; pricing index or other agency’s

pricing vs. current contract pricing) Negotiated reduction in price and/or payment terms Annual contract created for item previously purchased as a one-time Change in design or specification Substitution (i.e. rebuilt vs. new; lease vs. buy) State, County or other cooperative purchasing contracts utilized (i.e. piggybacking) Reverse Auction (projected savings based on old price/established baseline)

SAVINGS/AVOIDANCE COMPUTATION:ANNUAL CONTRACT:  Old Price - New Price = Savings  

Savings x Projected Annual Usage = Annual SavingsONE-TIME PURCHASE ORDER:  Req.Pre-Encumbrance - P.O.Encumbrance = Savings

EXPLANATION OF PROCUREMENT ANALYST ACTIVITY:     APPROVED BY: __________________________ __________________________

PROCUREMENT SUPERVISOR SUPPLY SERVICES MANAGER

     

Market Research

The purpose of market research is to analyze and evaluate the external marketplace as it applies to product/commodity purchases, to better understand how business is done in specific industries, and to develop improved procurement strategies to maximize value for each taxpayer dollar spent.

The key activities in market research are:• Identify potential supply sources.• Evaluate the industry.• Identify viable supply sources.• Perform supplier assessments. • Perform supplier comparisons. • Identify supplier opportunities.

Market Research cont.

Evaluate the Industry This is an investigation of marketplace processes, trends

and influences:• Supplier practices• Other government agency purchasing practices. This

includes analysis of other agency contracts for potential cooperative purchasing arrangements.

• Industry and market trends • Industry capacity and utilization• Pricing methods• Cost drivers• Market trends• Market cycles• Market timing strategies• Technology• Regulatory impacts• Safety, health and environment

Cooperative Purchasing

• The City has been doing cooperative purchasing extensively for the past 15 years

• City Charter and Administrative Code allow for piggybacking any public agency contract regardless if competitively bid

• Approximately 50 of our 480 annual contracts are from cooperatives, including City, County, Federal, Regional and National contracts

• The City currently uses 15 of the contracts marketed by U.S. Communities

• Modular Furniture, Playground Equipment, Laptops• Lead Agency for MFP/Copiers Contract

• Hierarchy of Cooperatives• Advisory Board, Audits, LPA model, Transparency, Commitment

of best overall pricing, Saves Money

ADVISORY BOARDThe U.S. Communities Advisory Board is made up of key government purchasing officials from acrossthe United States. The Advisory Board provides leadership and overall direction for the U.S.Communities Government Purchasing Alliance.City and County of Denver Jim McIntyre, DIRECTOR OF PURCHASINGGreat Valley School District Charles Linderman, DIRECTOR OF BUSINESS AFFAIRSCity of Houston Calvin Wells, C.P.M., CITY PURCHASING MANAGERHarford County Public Schools Jeff LaPorta, SUPERVISOR OF PURCHASINGCity of Kansas City Renee V. Haskin CPPO, MBA, ASST PROCUREMENT MANAGERHennepin County Christopher O. Gran, C.P.M., PURCHASING MANAGERCity of Los Angeles Kenneth F. Desowitz, C.P.M., DIRECTOR OF SUPPLY SERVICESLos Angeles County Gerald R. Plummer, DIVISION MANAGERCity of San Antonio Denise Gallegos, C.P.M., PROCUREMENT ADMINISTRATORMaricopa County James E. Foley, CPPB, DEPUTY CHIEF PROCUREMENTCity of Seattle Nancy Locke, CITY PURCHASING MANAGERMiami-Dade County Miriam Singer, CPPO, FCPM, FCPA, DIRECTORCobb County Mark D. Kohntopp, C.P.M., INTERIM PURCHASING DIRECTORNorth Carolina State University Jessica G. Dalton, CPM, CPPB, PURCHASING AGENTDenver Public Schools Michael Thomas, CPPO, C.P.M., DIRECTOR OF PURCHASING Salem-Keizer School District LaVon Maskell, PURCHASING COORDINATOREmory University Rex Hardaway, DIRECTOR OF CONTRACTSSan Diego Unified School Dist Arthur S. Hanby, Jr., CPPO, C.P.M., CPPB, A.P.P., DIRECTORFairfax County Cathy Muse, CPPO, DIRECTORHillsborough County School Dist Jean Bowman, GENERAL MANAGER OF PURCHASINGFresno Unified School District Paul Rosencrans, EXECUTIVE DIRECTOR OF PURCHASING

Founders- Founded, owned and governed by:

Association of School Business Officials International (ASBO)

National Association of Counties (NACo)

National Institute of Governmental Purchasing (NIGP)

National League of Cities (NLC)

United States Conference of Mayors (USCM)

Over 90 State Sponsors

Illinois State Sponsors

Illinois Association of School Business Officials

Illinois State Board of Education

Illinois Municipal League

Reverse Auctions

• Conducted 9 Reverse Auctions for Commodities with great success in the past year

• Auctions managed by Peralta Garcia • $2.5 million in savings (19%)

– Traffic Signal LED’s– Roll Paper– Nitrile Gloves– Trash Receptacles– Office Products (in process)– Water Treatment Chemicals (in process)