The Show Me, E-Commerce State

The Show Me, E-Commerce State

By Andrea Novotny
Staff Writer

Several states may soon follow the example set by Missouri school officials, who have established an online shopping network to simplify the procurement process.

Dubbed the Buy Board, the system allows state and local school officials throughout Missouri to buy instructional, custodial and other supplies. It also maintains a database of purchasing activity by vendor, commodity and user, allowing districts to do their planning for the following year's budget.

The system, which uses technology developed by Ambac Connect Inc., Austin, Texas, will be expanded by year's end to allow the purchase of information technology, Ambac officials said. Currently, 280 Missouri school districts and eight vendors are using the Buy Board, which posts 800,000 commodities.

"The Buy Board online catalog dramatically simplifies the procurement process, providing substantial savings for our school districts, while assuring them of the supplies they need, when they need them, at the best available price," said Carter Ward, executive director of the Missouri School Board Association.

"In addition to the enormous buying power of this cooperative, we are also taking a major technological step forward into the future of government purchasing, " Ward said.

Missouri school districts activated the online catalog on Oct. 8, which allows administrators to search for products on the Missouri Purchasing Resource Center Buy Board using keywords, product numbers or categories. Officials then can order items directly from their computer screen.

Ambac, a subsidiary of the government bond insurer Ambac Financial Group Inc., New York, chooses the vendors and products to be sold on the online system, which is funded partly through vendor surcharges. Vendors pay Ambac's Buy Board 1 percent of their gross sales. Ambac then pays part of that 1 percent to the Missouri School Board Association as a sponsorship fee.

State officials from Connecticut, Georgia and Illinois said they are considering adopting the same system, which analysts see as a trend.

"A lot of state and local governments and educational [groups] are streamlining the procurement process, either by changing the process itself or by moving the procurement process over the Internet or online. Missouri is a natural extension of this," said Leslie Kao, a public-sector market analyst for G2R Inc., Mountain View, Calif.

"This is a great opportunity for local school districts to enhance what they are already doing," said Nick Caruso, a spokesman for the Connecticut Association of Boards of Education.

Missouri's move is part of an aggressive statewide push to get its school districts on the Internet, said Jacque Cowherd, deputy executive director of the Missouri School Board Association. But it will take time to predict cost savings for school districts, Cowherd said. The bidding process typically takes school districts 30 to 45 days, he said. The cost to districts varies widely based on the district's size and the amount of administration and advertising needed, he said.

The Missouri School Board Association "is starting a process to save the districts money to allow them to redirect resources back to classroom activities rather than administrative activities," said Cowherd.

Some school districts have limited resources to do bid work and tend to flock to major vendors, such as Wal-Mart stores. The Buy Board will give those districts more vendors from which to choose, he said.

"Missouri is clearly leading the drive to bring electronic commerce to the grassroots level, implementing ways to contract for goods and services, easily and inexpensively," said Steve Attanasio, Ambac Connect's chief executive officer.

Connecticut school districts almost went online with a similar system developed by GE Capital Services two years ago, but company officials suddenly pulled the plug after grim short-term revenue projections, Caruso said.

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