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More efficient sustainable procurement could save Germany billions

9 January 2014

German municipalities could save billions of euros if sustainable procurement practices were implemented more efficiently, a new study from KPMG has revealed. Up to three and half percent of the country's annual purchasing costs of €480 billion could be cut through transitioning to effective sustainable procurement - a figure which would have a significant impact on public finances.

Of the 56 cities and towns surveyed, a lack of tools and know-how proved the most-frequent barrier. In many cases staff lack the skills required to effectively procure sustainably (only a third of survey respondents had the knowledge and set up needed). The inclusion of sustainable procurement in the planning and budgeting stages was also lacking in the majority of cases.

"A recurring cardinal error is the late integration of procurement and a fixation on price and less on the Life cycle costs and the actual added value of the required products and services." said Clemens Dicks, procurement consultant at KPMG. New German laws require municipalities to include ecological and social aspects into their procurement processes, providing the ideal time for municipalities to revisit their overall procurement practices, says Mr. Dicks.

The study is available to download in the SPRC Resource Centre.