Optimising the use of Purchase Cards Case Study

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Optimising the use of Purchase Cards Case Study

• Angela Kirby
• Coventry City Council

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Background

• Implementation of Oracle iProcurement (electronic
  purchase order system) began in 2003
• Purchasing cards implemented at the same time as
  a complementary purchasing tool (but not
  integrated into iProcurement)
• Introduced directorate by directorate to give
  structure to the project
• Used where iProcurement isnt practical

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Usage Strategy

• Purchasing Cards used for high volume, low value
  purchases
• Examples of use
• - Rail and air travel
• - Petty cash purchases
• - Subscriptions/training courses
• - Food Purchases
• - Internet purchases
• Cardholders are advised cards are not to be used
  instead of iProcurement, or in conflict with
  Council contracts

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Where are we?

• Almost 1000 cards in use across the Authority
  one of the highest users in the country
• Average monthly spend in excess of 450k (mainly
  food purchases!)
• Purchase card usage equates to 2 of spend but
  25 of transactions
• Procurement Services manage and administrate the
  programme

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Optimising the use

• Originally card usage was limited to one area
  (Stores) and Directors
• We soon realised the potential of the cards and
  set about to optimise the usage
• This was done mainly through analysis of Accounts
  Payable information and research
• We also spoke to other Authorities to see what
  they were doing
• Where appropriate in new contracts it became a
  condition to accept purchasing cards

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Changing the Culture

• It became easier to encourage use as the
  organisation became familiar with the cards as a
  purchasing tool
• Purchasing cards are now seem as the norm in
  Coventry
• Promotion is essential across the Authority to
  gain visibility
• Senior Managers need to be seen to be supportive
  of the programme

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Optimising the use - examples

• Remove Rail Warrants use the cards to purchase
  tickets either online or at the station
• Food purchases in school and social care kitchens
  have removed 000s of invoices
• Petty Cash analysed petty cash receipts and
  encouraged frequent users to get a card
• Cheques/payments in advance

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What would we do differently?

• Baseline and record any changes you intend to
  make (eg replacing an invoice based system with
  purchasing cards)
• We didnt so cant readily quantify the
  efficiencies we gained yet we know they are
  significant
• Other that that not a lot!

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Any Questions