SIU spent $100,000 on a study to discover how it could save $2 million each year in its purchasing power, in part by giving priority to preferred vendors.

Arthur Andersen, a national accounting and consulting firm, was recruited by the University to conduct the study to determine which cost-effective methods would be most suitable. The results of the study were announced at Thursday’s Board of Trustees’ meeting in Springfield.

The study showed SIU’s purchasing methods need to be changed. It shows preferred vendors should be the first priority ahead of other suppliers because they offer the best cost-savings margin. SIU utilized preferred vendors in 4 percent of its purchases for fiscal year 1997 and bought more than $132 million in goods and services. The Carbondale campus purchased from 8,388 vendors, while the Edwardsville campus purchased from 2,482 vendors. Springfield’s campus bought from 1,014.

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SIU’s purchasing system hires 57.5 full-time employees, with an annual operating cost of more than $1.7 million.

The study also showed department procurement cards, credit cards used for small purchases, should be implemented quickly because they will reduce paperwork for large-volume, small-dollar purchases.

In addition, the Oracle project, a new University computer system set to begin operations in 1999, will also reduce purchasing paperwork. The report states the University should begin planning for the future changes.

According to the report, a task force should be devised by SIU President Ted Sanders to implement the study’s recommendations.

Sanders said the study necessitates a prompt response.

We will move in this direction as quickly as possible so that savings can be made available for other pressing needs related to the core functions of the University, Sanders said.