Operational considerations for Academies

26th March 2020

Operationally, schools across the country are on lockdown, with few pupils and staff on site. This may, however, depending on your individual circumstances, give you the opportunity to undertake some activities that you haven’t been able to previously.

It is also perhaps a time to consider procurement.

It is likely that a large number of your suppliers are feeling considerable strain, so this poses both a threat and an opportunity for you.

There is a threat that your suppliers may not survive, and any existing orders (and potentially cash) may not be fulfilled on the return to (the new?) normal.

This financial pressure on your suppliers, may however create an opportunity for you.

For a number of businesses, they will survive, but will be feeling a short term cash drain and will be in need of cash. This creates a powerful bargaining tool for you.

Perhaps the round of IT refurbishment you have planned for summer could be ordered and paid for now (if you have cash available)?

The suppliers are likely to see this favourably, and therefore you may be able to achieve a better deal.

If you are making advance payments to suppliers, you will need to protect yourself as much as possible, and also consider your finance policy. Your policy may say that invoices are only paid when they have a matching delivery note (i.e. to stop payment before delivery). 

It is worth considering if you do place and pay for advance orders, what protection you have in place.

This will include sufficient due diligence checks with the supplier, consideration of your insurance provider and any cover you may have, and any other assurances the supplier can give you.

Finally, if you are owed goods or services by a company that goes into administration, you will have a claim in the administration process, but you may not receive all of your money back.

There is no easy answer, and each supplier would need to be considered on a case by case basis.

If you have any questions on procurement in the current pandemic, please do not hesitate to contact your usual Bishop Fleming contact.

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