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Apr 20, 2023

Group purchasing organization list and types explained

Business owners researching types of GPOs

All group purchasing organizations (GPOs) operate under the same basic premise: pool purchasing so participants get better vendor pricing and terms. Group purchasing dates back to the 18th century, starting in 1910 with the hospital industry. Since then GPOs have evolved to meet the needs of a variety of businesses across multiple industries. Let’s take a look at a list of five common types of GPOs serving different business sectors, along with examples of distinguished GPOs making a difference in the B2B world. 

List of Group Purchasing Organizations

⁠1. Industry Specific GPO

Industry Specific GPOs, also known as Vertical GPOs, focus on a particular industry such as healthcare, government or education. They help their participants source a broad range of direct and indirect materials and services specific to that industry. These GPOs originated in the hospital industry, but have now expanded to represent many industries. Here’s an example:

Premier Inc.

  • Healthcare GPO

  • Aggregates over 4,000 hospitals and 175,000 healthcare providers in the US

  • Negotiates medical equipment, pharmaceuticals, and healthcare-related products and services

  • Offers data analytics and performance improvement tools specific to the healthcare industry

2. Product Specific GPO

Product Specific GPOs, also known as Horizontal GPOs, unite businesses from a variety of industries to source and purchase similar indirect materials, goods and services, such as supplies and equipment, MRO (Maintenance, Repair and Operations) and temporary labor. Here’s an example:

Omnia Partners

  • Caters to large corporate purchasers and Fortune 500 companies

  • Serves over 4,500 companies with average 14,000 employees across 35+ industries

  • Focuses on office supplies, IT equipment and services, travel, and facilities management

  • Utilizes category analysis research based on member feedback

3. Volume Buying GPO

Volume Buying GPOs can also be described as Collaborative Sourcing. This type of GPO serves two or more companies that pool their category specific spend to leverage greater purchasing power. It is most often used to procure direct materials, and the process can be facilitated by a third party consultant. Here’s an example:

Allstar Purchasing

  • Member-owned Packaging GPO

  • Purchases for over 600 locations across the US

  • Members include food and non-food manufacturers, C-stores, and supermarket chains

  • Sources competitive pricing on paperboard, resin, plastic containers, film, corrugate, and closures

4. Diversified GPO

Diversified GPOs represent businesses that vary across industry, company size, and category procurement. They rarely purchase raw materials, but rather cater to small and mid-sized enterprises and focus on indirect supply spend across a number of categories. Diversified GPOs are ideal for everyday needs like office supplies, facilities, and copy & print services, or for project-specific purchasing like furniture and tech. Our GPO fits under this type:

Excelerate America Collective

  • Largest GPO for small to medium-sized businesses

  • 40,000+ buying participants across 50 states

  • Negotiates and actively manages pricing on office supplies, cleaning & breakroom, print services, tech, furniture and more

  • Provides data analytics and spend management strategies for members

5. Purchasing Cooperative

Purchasing Cooperatives resemble Industry Specific GPOs, but they are run by members and share both profit and loss. As co-owners, Co-Op members can only purchase what the group sells and must be paying stakeholders to get discounts. Cooperatives are prevalent in farming, food ingredients, utilities and insurance. They prioritize industry-advocacy, and often use their power to sway policy. Here’s an example:

American Farm Bureau Federation

  • National advocate for farmers, ranchers and rural communities

  • Membership spans more than 2,800 counties in 50 states with 6 million members families

  • Secures discounted pricing on equipment, insurance, raw materials, feed and more

  • Economic analysis team provides members with market and policy insight

Choose a group purchasing organization that advocates for you

No matter the type, group purchasing organizations should play multiple roles for the businesses that join them. The most distinguished GPOs act as more than just a partner to your procurement activity. They advocate on your behalf when negotiating with vendors. They work tirelessly to ensure competitive pricing and keep you updated on buying program changes. Finally, they utilize data analytics to give you insights about your spend management to make smart purchasing that much easier. 

More about Excelerate America’s GPO

At Excelerate America we focus on helping small and medium-sized businesses save smarter on office supplies (and much more) through our partnership with ODP Business Solutions – this is Office Depot’s business division. 

⁠We actively negotiate on behalf of our Collective’s members to ensure they always purchase with power. Here are a few of our program highlights:

  • Customized core list pricing on 1,800+ products

  • Up to 55% off on office supplies, cleaning & breakroom, tech & more

  • Up to 40% off on copy & print services

  • Free shipping on $20+ orders

  • Net 30 payment terms

  • Concierge service tailored to member needs

  • Analytics around spend management

⁠Thinking about joining our group purchasing organization? Learn more about our buying programs to start saving smarter for your business.

Want to learn more about how to save money with a GPO?
⁠Download The Power of Many: Guide to Group Purchasing for Office Supplies.
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Roy Lamphier

Small biz owner, mentor, and economics geek.