19 May 2021

Councils charged triple the recommended mark-up on IT products

Councils charged triple the recommended mark-up on IT products image

Councils are paying more than three times the recommended mark-up on technology products, a new study has revealed.

The analysis by Probrand found that before the pandemic, the average margin paid by local councils on technology was 9.8%. The Society of IT Managers states that organisations should be paying no more than a 3% margin to suppliers.

One council was found to be paying margins of nearly 580% on its purchases, nearly two hundred times higher than the recommended mark-up.

The study also found mark-ups spiked 'dramatically' during the first national lockdown, rising to more than 50% on average for all tech buyers.

Ian Nethercot, MCIPS supply chain director at Probrand, said: 'When we conduct spending reviews it’s not unusual to find some organisations paying way more than 3% over the trade price of the product – especially if they don’t have price monitoring tools in place. In recent years though, we’ve seen companies getting more savvy when it comes to restricting the margins paid to suppliers.

'COVID-19 completely changed the landscape, however. We witnessed both a huge spike in demand and a significant contraction in supply – due to factories closing in Asia and planes being grounded. There is no doubt that this extreme supply and demand characteristic resulted in panic buying, with people prepared to buy whatever they could get their hands on at whatever price in order to equip staff working from home.'

SIGN UP
For your free daily news bulletin
Highways jobs

Rights Of Way Officer

Cambridgeshire County Council
£27,741 - £29,577
We are looking for a candidate who has practical experience of working with Rights of Way and access issues and... Cambridgeshire
Recuriter: Cambridgeshire County Council

Casual Assistant Swimming Instructor

Chelmsford City Council
Grade 4 - £11.01 per hour
Riverside Leisure Centre is Chelmsford City Council’s flagship leisure facility, offering a variety of sporting activities where there is something... Chelmsford, Essex
Recuriter: Chelmsford City Council

Systems Support Analyst

The Royal Borough of Kensington & Chelsea Council
£26,544 - £30,618 per annum
We are committed to promoting equality and respecting diversity and welcome applications from all sections of the community. Kensington and Chelsea, London (Greater)
Recuriter: The Royal Borough of Kensington & Chelsea Council

Service Manager

The Royal Borough of Kensington & Chelsea Council
£59,111 - £67,900 per annum
Create a better quality of life for our most vulnerable children and young people. Kensington and Chelsea, London (Greater)
Recuriter: The Royal Borough of Kensington & Chelsea Council

Contracts and Commissioning Manager

The Royal Borough of Kensington & Chelsea Council
£44,370 - £50,964 per annum
An opportunity has arisen within the Adult Learning team that develops and oversees the contracting and commissioning function for this service.  Kensington and Chelsea, London (Greater)
Recuriter: The Royal Borough of Kensington & Chelsea Council

Public Property

Latest issue - Public Property News

This issue of Public Property examines how how flexible workspaces can lead the way in regeneration for local authorities, Why local authority intervention is key to successful urban regeneration schemes and if the Government’s challenge of embracing beauty is an opportunity for communities.

The March issue also takes a closer look at Blackburn with Darwen Council's first digital health hub to help people gain control over health and care services.

Register for your free digital issue