Amazon Business caters to the public sector with technology-driven features and benefits

No question, the public sector relies on Amazon Business as a key supplier. “Yes, local governments are good customer prospects for Amazon offerings,” says Mike Kernish, director and general manager, public sector at Amazon Business. He offers this statistic: “Amazon Business currently works with over 90 of the top 100 most populous local governments and special districts.” He explains that his firm is helping those government entities digitize their procurement efforts by simplifying and streamlining processes and leveraging his company’s built-in tools for increased cost savings, visibility and agility.

OMNIA Partners offers Amazon Business cooperative contracts. The competitively solicited Online Marketplace contracts are from two lead public agencies: the State of Utah and Prince William County Public Schools. The contracts are available to public sector entities including state and local government agencies, public and private K-12 school districts and higher education organizations, as well as nonprofit businesses.

It should be noted that Utah was the first state government to issue an RFP to an online store for an entire category of products. Kernish explains that the Utah state government awarded a cooperative contract to Amazon Business to modernize its procurement practices. “Amazon Business provides the state’s procurement team with increased visibility, reporting capabilities, and fast, two-day delivery with Business Prime to ensure compliance and save time.”

Cooperative contracts can be a time- and cost-saver for the public sector, Kernish believes. “Having multiple government entities combine their purchasing power and buy through competitive contracts can definitely save procurement departments time. Additionally, aggregating demand to get lower prices from the selected suppliers will save them money as well.” On the time-saving front, Amazon Business increases efficiency and reduces costs by allowing procurement leaders to quickly compare suppliers and access competitive pricing and selection.

Kernish points out that under the Amazon Business-OMNIA cooperative contract, government procurement departments can research a range of suppliers and products in a single, consolidated view. “Having these capabilities is a huge benefit when compared to traditional processes, which can be time-consuming, requiring hours of manual quote comparisons.” He adds that the Amazon Business-OMNIA cooperative agreement lets customers analyze their agencies’ commodity spend in real-time and identify issues before an order is even processed.

Kernish says his team sees a trend among business and government buyers who expect the same ease-of-use they’ve come to expect from their consumer purchasing experience. “Cooperative purchasing agreements through online channels allow local government procurement teams to use the same digital tools at home, at work.” One example he offers: “When the state of Utah realized that employees were using their personal Amazon accounts for off-contract spending, the organization needed the digital tools to gain control and visibility of their purchases to ensure compliance. Through a cooperative contract with Amazon Business, the state’s procurement team leverages the familiar consumer experience in a business-to-business context.” Kernish says his firm’s setup enables state buyers to access built-in solutions and features to control spending, increase transparency in reporting, and discover purchasing insights—all in one place.

Without a doubt, lean-staffed public purchasing teams have more on their plates in 2022, and old ways of doing things may no longer work, says Kernish. “Government procurement departments have historically allocated significant time and resources to traditional processes, such as manually searching for suppliers and managing spend. But lean-staffed government agencies facing larger workloads are finding that by shifting to online procurement, they can simplify the purchasing experience with tools and features to improve visibility, reduce paperwork and free up time and budgets.”

He notes that Amazon Business buying tools can increase efficiency and reduces costs by allowing procurement leaders to quickly compare suppliers and access competitive pricing and selection. “Additional features such as Guided Buying, multi-user accounts, and reporting and analytics are also helpful solutions to streamline government procurement processes.”

Reaching local and diverse suppliers

The Amazon Business executive says he sees more local governments looking to cooperative contracts through online channels to connect with more local and diverse suppliers. “According to the Amazon Business B2B E-Commerce in Evolution Report, government buyers considered ‘supporting local businesses in the community’ and ‘increasing supply chain diversification’ as top five procurement priorities last year.”

Kernish adds that many federal and state government buyers are mandated to allocate a certain percentage of their procurement dollars to diverse businesses. “With the Diversity Certifications program on Amazon Business, a government purchasing organization can easily direct spending to small, local or socio-economically diverse suppliers.” He believes that cooperative contracts will continue improving procurement for both buyers and sellers, because they simplify the buying process for governments. At the same time, they help level the playing field for small businesses.

Targeted filtering is another key tool available by purchasing through Amazon Business. Users have the option to filter by certification status, which helps procurement departments find and purchase from small, local, and diverse sellers to meet their supplier diversity goals. What’s more, through the GSA Commercial Platforms Initiative, Amazon Business provides government buyers with an easy way to connect with small and diverse sellers through search and filtering tools and diversity credentials.

Kernish predicts several technologies will have a big impact on public purchasing over the next five years. “With the shift to remote work, many public sector procurement departments had to quickly implement digital transformations and adopt new technologies to successfully continue operations at a distance.” He notes that his firm’s B2B E-Commerce in Evolution Report forecasts that more than half of the surveyed organizations plan to invest in automation and digital invoicing within five years.

The Amazon Business executive says technologies such as machine learning and artificial intelligence (AI) stand ready to continue reshaping public sector purchasing as more buyers invest in e-procurement. He explains: “AI and machine learning not only allow organizations to automate purchasing guidelines and meet their spend goals, but also to unlock immense time and cost savings, which is ultimately beneficial to organizations of all sizes and industries, including those in the public sector.” Kernish spotlights two of his firm’s technology-powered solutions:

• Amazon Business’ Spend Visibility tool is powered by machine learning and tracks purchasing patterns to inform budgeting decisions, manage compliance with purchasing policies, and unlock time and cost savings.
• The Guided Buying tool on Amazon Business is also powered by AI and machine learning. This tool enables procurement managers to easily implement spend policies in the purchasing experience. Organizations using Guided Buying can mark certain products or selling partners as “preferred” or “restricted,” helping buyers purchase products more efficiently and in compliance with each entity’s rules.

Amazon Business recently hosted its annual virtual procurement conference Reshape, which featured sessions on several purchasing-related topics, including:
• Procurement strategies for the C-suite
• Meeting business objectives with purchasing agility
• Delivering on the digital agenda
• Empowering employees with digital purchasing
• Fostering socially responsible procurement

Go here for more information, and to learn how to view the virtual event on-demand.

Michael Keating is senior editor for American City & County. Contact him at [email protected].