Port Delivers Efficiency and Transparency Through e-Procurement

The Challenge

An expanding port, located in the Gulf of Mexico was investing heavily in expensive equipment and construction of large infrastructure projects. As one of the 10 largest ports in the United States, it was implementing these projects on an extensive scale.  Effectively competing the equipment purchases and infrastructure projects was difficult with the Port’s manual processes.

To bid its construction projects, the Port would typically create and distribute up to 50 plan document sets. In addition to being expensive, it was tying up valuable internal resources and slowing down the process and limiting the amount of competition, particularly for smaller projects that only required minimal competition.

Because the Port had limited outreach capabilities, a majority of contracts went to large national contractors and suppliers rather than local companies. Few local suppliers were winning major contracts. And even among the large national companies, the Port had difficulty attracting sufficient competition to reduce costs.

Finally, the Port struggled with creating and retrieving documentation to show it was following procurement practices required of public entities; defending against bid protests was disruptive and consumed valuable internal resources.

The Solution

In 2007, the Port partnered with eBid Systems to automate and streamline its procurement processes. eBid Systems implemented a supplier portal to enable the Port to better interact with potential suppliers. They opted for a private portal to have greater control of the supplier relationship and increase participation from local companies.

The portal included self-serve supplier registration, automated notification of bid opportunities, and ability to post large document sets. Sealed bids could be submitted online making it easier for suppliers to compete for projects while allowing the Port to more efficiently receive and analyze bids. The electronic process also enabled online public bid openings and automatic posting of award information.

The Results

Port procurement staff report time savings of over 60% in the bid process through the reduction of managing documents and communications alone. On each project, the required number of printed plan sets dropped from 50 to 15 because of electronic distribution. The Port now has over 800 relevant suppliers in its private database that it controls.

Instead of getting the requisite three quotes on smaller purchases, the Port now invites up to 50 suppliers and has seen a reduction in prices from the increased competition. Because it is easier for local suppliers to be aware of bid opportunities, more local firms are participating in the bid process and receiving major contracts that typically went to companies outside the area.

While initially not a major consideration, the record retention and automated activity logs make it easier for staff to demonstrate compliance with compulsory sourcing requirements. It is easy to audit the activity of every sourcing event including transmittal of notifications, opening of sealed bids, and access to documentation. Because records are easily accessible, bid protests are no longer feared and the Port’s reputation in the community as an open and transparent government entity has significantly improved.