×

Warning

JUser: :_load: Unable to load user with ID: 345

What is the history of shopping groups?

When we talk about purchasing groups, we refer to the concept established in the United States of Group Purchasing Organization (GPO). This is nothing more than a model of cooperation that brings together a group of companies to obtain discounts from suppliers based on the collective purchasing power of their members.

However, it is not a new concept. Its history, as Thomas O' Neill comments in a note hosted within the blog of the American buying group CoVest, dates back at least to the eighteenth century, and refers specifically to the cooperative formed in 1752 by one of the founding fathers of the United States, Benjamin Franklin.

The Philadelphia Contributionship for the Insurance of Houses from Loss by Fire was incorporated into a mutual insurance organization that covered a limited area of this American city. It was the first to establish a financial reserve from which to pay any claims. It is since then the oldest owned insurance company of Americans.

Later, with the passage of the Industrial Revolution in England, according to O'Neill himself, a large number of small companies began to make trade associations and form guilds with common benefits.

An example of this was the Rochdale Pioneers Equitable Society, a consumer cooperative founded in 1844 in this city in the north-west of then Britain. This marked a milestone by being the first to distribute among its partners the surpluses generated by the activity and raise funds among them to buy goods at a lower cost. Along with this they established a series of principles that became the foundation of the modern cooperative movement.

From agricultural cooperatives to medical associations

These approaches motivated back in the United States in 1867 the development of a peasant organization known as The Grange. This arose in the midst of the economic crisis derived from the civil war that had left isolated farmers from the south and west of the country, whom it began to group to avoid intermediaries in the commercialization of agricultural products. Thus arose various agricultural purchasing cooperatives.

For its part, at the beginning of the twentieth century the medical sector of the North American country itself also welcomed the model of organizing group purchases for its own purposes. In 1910 the New York Hospital office established the first U.S. GPO.

Gradually new health care GPOs were added until they reached ten in 1962. However, the government's Medicare and Medicaid programs fostered its exponential growth until reaching 40 in 1974 and tripling its number three years later. Currently, at least 96% of all intensive care hospitals and 98% of U.S. community hospitals have a GPO membership. Likewise, about 75% of hospital purchases are made through GPO contracts.

The leap from purchasing groups to other industries

From the GPOs of the medical area, other industries have since embraced this cooperative sourcing model. There are ranges from transportation and aviation to chemicals and retail, among others.

The security and audiovisual systems sector was no exception. In this last field emerged at the beginning of this century USAV, an association of actors in the US audio and video industry to offer attractive solutions in this vertical to the rest of the country. In principle, it was made up of only seven integrators and three manufacturing partners.

In the fall of 2002, USAV organized the first integrator meeting for executives of partner companies, thus distinguishing itself from other organizations in the industry. This meeting focused on commercial strategy and best practices that could serve as experience for the benefit of each partner.

This model of cooperation has remained in time and has allowed USAV integrators to currently serve more than 88% of the top 50 U.S. metropolitan areas.

In May 2017, USAV became part of PSA, the world's largest consortium of system integrators formed, as stated on its website "by the most progressive AV and security system integrators in North America".

According to the same site, combined, PSA members have more than 400 branches, employ more than 7,500 industry professionals and are responsible for more than $4.5 billion annually in professional safety, fire, personal protection and audio-visual installations.

Both organizations signed an agreement to promote in 2020 the first purchasing group in Latin America: ConsorcioTec™. Unlike the existing ones, this consortium has been created specifically for the region's low-voltage solution integrators.

There are integrators and independent contractors with a focus on electronic security, building automation, home automation and systems integration from Mexico to the south of the continent.

Do you need help with a Building or Home Systems Project? Fill out the form and let us know.

Or contact us via Ext. 76 or 72 at:

Tel: +1 [305] 285 3133 - Miami
Tel: +52 [55] 4170 8330 - Mexico
Tel: +55 [11] 3042 2103 - São Paulo
Tel: +57 [601] 381 9215 - Bogotá

Or via email: [email protected]

About Us

ConsorcioTec is Latin America's first dedicated integrator & dealers buyers' consortium servicing the electronic security, datacom networks, custom electronics, building automation, systems integration and multimedia installations industry.