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Solidarity-based purchasing: why and how should the approach be structured?

Published on April 6, 2022
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[Interview]

Implementing a solidarity-based purchasing approach is a unifying project in both the private and public sectors. The benefits are many: cost and risk control (social, environmental, economic), competitive advantage, improved image with partners and customers, innovation and value creation. But, in practical terms, where do you start? Yann Le Coz, a specialist in responsible purchasing, takes a closer look.

Interview with Yann Le Coz on solidarity purchasing

On average, purchasing accounts for 50 % of a company's turnover. It is therefore an important area for improving its profitability. economic performance. Making solidarity purchases also helps to consolidate the CSR policy (corporate social responsibility). For public authorities, it is a lever that enables them to assume their environmental, social and economic responsibilities. How can a solidarity-based purchasing strategy be put in place? In Yann Le Coz's view, private and public sector purchasers need to integrate a "solidarity" approach into their purchasing strategies. overall cost logic in their purchasing process. Here's an overview in seven questions.

What are solidarity purchases?

Responsible purchasing, solidarity purchasing, inclusive purchasing... In the field of purchasing, there is a wide variety of semantics. Not least because the private and public sectors sometimes use different words to describe the same thing.

Responsible purchasing is the result of the the company's CSR policy in purchasing. CSR is an expression of the Sustainable Development Goals (SDGs) defined by the UN.

Responsible purchasing takes into account environmental, social and societal aspects. Solidarity purchases, sometimes called inclusive purchases, fall into this category. They are made to the disability sector. In other words, they are made to organisations that mainly employ disabled people, such as ESATs (establishments and services providing assistance through work) and EAs (adapted companies). Or to self-employed disabled workers (TIH).

Do solidarity purchases cost more?

It's a common misconception that solidarity purchases are more expensive. In ESATs and EAs, a subsidy paid by the State offsets the additional production costs associated with the training and support of disabled workers. These structures must be competitive and sell goods or services at market prices. A price higher than the market price must be justified by a value proposition, i.e. an additional service.

Why buy solidarity? Are the issues the same in the private and public sectors?

Any employer with at least 20 employees or 20 agents, whether private or publicmust employ at least 6 % of disabled people. If it does not comply with this employment obligation (OETH), it must pay an annual contribution. Purchasing products or services from an ESAT, EA or TIH reduces the amount of this contribution.

Within the HR function, the "disability mission" is therefore increasingly approaching the purchasing department to push for this type of order. In this way, socially responsible purchasing is strategic dimension with regard to the OETHThis is particularly true for organisations that are struggling to recruit disabled people.

In addition, adopting a solidarity-based purchasing approach enables companies to meet their CSR commitments. This type of policy is also a advantage with banksIt also helps us to be attractive to new customers. It also makes us attractive to attract talent as well as to respond to expectations of customers and suppliers.  

Today, large companies prefer partners who are committed to CSR. They are looking to reduce their reputational risk.

How do you set up a solidarity-based purchasing approach?

Structure is essential to ensure that the approach is sustainable over time. I have identified three fundamental stages.

1 - Make a commitment by signing the Responsible Purchasing and Supplier Relations Charter (RFAR)

The RFAR Charter includes 10 commitments. Some of these are directly linked to CSR objectives and socially responsible purchasing. For example: "to assess all the costs and impacts of the life cycle"; "to integrate environmental and social responsibility issues"; "to ensure the territorial responsibility of its organisation".

2 - Defining and implementing an action plan

This action plan aims to provide a concrete response to the 10 commitments of the RFAR Charter, in particular through actions to develop purchasing from the disability sector. It also requires a scorecard and performance indicators. For example: the amount of purchases made from the disability sector (EA, ESAT, TIH); the number of jobs created and/or maintained for people with disabilities; the number of invoices paid late, the average time taken to settle invoices, etc.

3- Get recognition for your actions... and communicate!

Once the target level of performance has been achieved, the organisation can then seek recognition. In this case, the "responsible supplier relations and purchasing" label and/or certification. ISO 20400.

What are the pitfalls to avoid?

It's important to get the company's other departments on board. While the HR function is generally already aware of the issue, other functions (IT, communications, production, etc.) can also be involved. withstand change. Perhaps because of previous bad experiences...

To remove any obstacles, buyers must first identify the potential benefits of solidarity purchasing. It may then be a good idea to proceed in stages, with "test" phases. They can also try co-contracting: instead of changing supplier, they are asked to entrust part of the service to an ESAT, EA or TIH.

What are the key skills you need to master as part of this process?

Buyers must have both technical skills (hard skills) and interpersonal skills (soft skills).

Hard skills

1/ Knowing the laws in force

Keeping an eye on regulations is essential, as there are many rapid changes. Since 2017: the "Sapin 2" Act, the Duty of Vigilance Act, the RGPD, the new Public Procurement Code, which confirms the possibility of choosing the best bidder rather than the lowest bidder. Or the so-called "conflict minerals" law or 3TG in 2021.

Purchasers must also be able to define their purchasing strategy: the possibility of reserving contracts for the disability sector or of allotting a lot to the disability sector as part of an overall contract.

Using a facilitator (consultancy firm) can be useful. For example, in the case of a call for tenders. For example, before reserving a contract for the maintenance of green spaces for the disabled sector, you could ask the facilitator to check that there are enough economic players in the area to put the contract out to tender. This is to avoid the contract being cancelled as unfruitful if fewer than three bids are received.

2/ Knowing which CSR levers to activate

To develop their purchasing strategy, buyers need to be aware of the regulatory context for CSR, as well as the issues and CSR commitments of their organisation. For example, public sector buyers need to be aware of the PNAD, SPASER or CSR policy, and private sector buyers need to sign charters or manifestos.

Whether they work in the private or public sector, they must also be aware of the levers available to them for responsible purchasing. Above all, they need to know how to assess the TCO or total cost of ownership. In addition to the purchase price, the TCO includes the cost of use and the end-of-life cost. For example, when buying printers, you need to consider not only the purchase price, but also the cost of consumables (cartridges, toners) and the cost per printout. The printers will be purchased in the traditional way, whereas an ESAT or EA will supply recycled cartridges.

3/ Understanding supplier ecosystems

Knowing your own suppliers is not enough. Buyers need to have an overview of the entire supply chain. Keeping abreast of innovations and engaging in regular dialogue with EA, ESAT and TIH can enable the organisation to identify a service provider capable of meeting a specific need not covered by ordinary commercial sector companies.  

Soft skills

1/ Communicating both internally and externally

2/ Knowing how to convince

3/ Ability to listen and empathise

What are the main benefits of the training courses?

Participants arrive at training with several expectations.

Firstly, they come to learn how to identify new best practices in responsible purchasing.

Then they look for a direction. They find out why they had difficulty setting an objective. Solidarity-based purchasing, like responsible purchasing, is a part of a multi-year approach to progress. Maturity is reached around the fourth or fifth year.

To conclude, I recommend that buyers not falling behind in responsible purchasing and structures to consider CSR in their business model. Because customers and employees are increasingly concerned about it. And it is also a differentiating factor in an increasingly competitive environment.

Our expert

Yann LE COZ

Responsible purchasing

A DESMA graduate, he has 30 years' experience in purchasing. After working as a purchasing manager [...], he joined [...].

field of training

associated training