Key factors of a cooperative central purchasing office. Comparative analysis of two experiences

Abstract

The competitive and dynamic environment has moved the companies to look for an operative excellence and the greater efficiency to survive, not being the cooperative companies out of this phenomenon. One of the tools that this type of organizations have is to create central purchasing office that should allow them to decrease their costs as consequence of the higher volume. In this sense, the concept of "central purchasing office" is defined as a mechanism that allows to concentrate different purchase needs, with the aim to improve the competitive position of each associated company. Blond (2017) said that, "the cooperatives of second degree constitute the mechanism by excellence of cooperative integration" (p.119). Additionally, according to the definition of "central purchasing office" of the Asociación de Centrales de Compras y Servicios de España (from now on, ANCECO), these bodies guarantee the diversity of formats, as far as they allow that the small and medium companies may compete to the same level that the big companies (ANCECO, 2016). At the same time, in the plan for a cooperative decade, the Alianza Cooperativa Internacional (from now on, ACI) (2013) exposes that the goal is the solid affirmation that the different organization coming from the cooperative is better that the one that try to maximize their profits. This vision stands out the cooperative identity, as well as the sustainability and the participation of the partners of each cooperative. The aim of this investigation is to detect the key factors for a good management of a cooperative central purchasing office and are analyze how is managed each of these variables of selected. The comparative analysis results interesting since two extreme cases are chosen: on one hand, the Federación Argentina de Cooperativas de Consumo (from now on, CCFACC), with only a year of operation, and, in the other hand the Coop Italy, a model with tradition in the market, with results checked and with projections of greater growth. An additional richness for the analysis is that each one of the cases is in different contexts and geographical continents. The methodology used is the study of multiple case crossed, where the sampling consists in two specific cases that are chosen for being relevant and extreme examples. Although each one of these cases are situated under different environments, both are sharing the commitment for the values and cooperative principles. On the other hand, to detect the key factors that contribute to the development of a central purchasing office, three studies have been analyzed, which investigate the factors of greater incidence for a successful cooperative operation. It is possible that in several cases the key factors have relation with the problems detected, which would confirm the importance of the best practices. The works reviewed were the following: Hoffmann and Schlosser (2001), Lagemann (2004) and Torres Ruiz et al. (2006). After having detected the key factors and have made the analysis between the two units of analysis selected on how influence each one in relation to each variable, it has been verified that the two offices act proactively in relation to these and, consequently, achieve a satisfactory performance. It has been confirmed that the confidence and the commitment are characteristic that are more strengthened recognized in the case of the Coop Italy, since they are more related with the time and with the good performance got, characteristics that that perhaps are already meet in the CCFACC, but not confirmed due to the lack of antiquity. It must be considered that it is a process still in his initial phases and it is difficult to give confidence and commitment to a project not still very known and with small experience. On the other hand, it is checked that none of the two cases have homogeneity of size; they are cooperatives of different sizes and geographically dispersion. Both have in common that their experiences operate with satisfaction and benefiting all the parts. Although it has not been verified the homogeneity in physical terms, it has been checked the homogeneity regarding the principles and cooperative values shared, having always like central axioma the human being. In both cases the fundamental reason of office is the sixth cooperative principle "cooperation between cooperatives", betting by a sustainable economy. Likewise, it is interesting to stand out that some of the results obtained have not previous findings in the literature. On the one hand, regarding the key factors, the main points detected were the following: • Competitiveness (assorted and price): for the sector of retail specifically, the assortment and the prices are key for their competitiveness. In the literature reviewed it has not been detected as a key factor, it has been confirmed as a problem in previous experiences. • Marketing homogeneous: The Coop Italy implements it and the results are successful especially giving an image of integrity between the different cooperative supermarkets. The CCFACC also began to implement it recently. • Own trademark: It has been checked that the commercialization of the own trademark in a central purchasing office is a fundamental tool as a strategy of differentiation and as of tool of profitability for having higher margins. The Coop Italy and the CCFACC have own trademark and a high percentage of the sales belong to this. During the literature review, we have detected key factors studied, that neither had mentioned in the literature. In this sense, the following grouping according to his nature were proposed: • Factors generators of attitudinal behaviors • Organizational factors • Commercial factors • External factors This structure was useful for the classification of the factors, what allows a more agile reading of the results. Besides, it helped to relate each one of them with the different phases of the cycle of life of a cooperative central purchasing office. During the research some limitations arose, which were considered in the moment to conclude the study. Best practices and recommendations for a theoretical model of central purchasing office are set only with analysis and the experience of two cases. Although they are two cases selected from a strategic approach, it is considered that only two is a small number to extrapolate the conclusions; being this situation an own characteristic of the methodology used (study of case). Other limitation of the present study is the reduce time of operation of the CCFACC, question that affects to his experiences and results, considering that these kinds of projects need time of get the results expected.