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Value in Procurement of Large Scale Services

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Cost Impact: increased to $80M net revenues

Value Added Impact: $2.3M capital improvements

 

Type: Services
Vendor: ReCommunity

Location: Phoenix, Arizona

 

Contract: $48,707,806

 

Start Date: December 2012
Duration: 10 years

Material Recovery Facility (MRF) Services

The City of Phoenix Public Works Department owns two facilities used to produce single stream recyclable material. The City partnered with ASU to re-compete the contract for facility operation services with the intent of improving performance and increasing revenues.

The City found the Best Value interview process to be highly successful in identifying the expertise of bidders. Each team brought operations personnel for individual interviews and answered questions regarding their planned operation approach and risk minimization strategies.

The Value Added portion of the RFP process allowed the bidders to propose additional scope and services that would benefit the City. Due to this process, the awarded vendor was able to offer capital improvements valued at $2.3 million to upgrade certain processing equipment.

REFERENCE:  Chuck Hamstra, City of Phoenix | chuck.hamstra@phoenix.gov

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Best Value Minimizes Cost in Services

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Cost Savings:

  • $500,000 per year in upfront costs
  • $400,000 additional internal savings
  • Reassigned 3 FTEs to different work

 

Type: Custodial Services

Vendor: Bee-Clean Building
Maintenance

Location: Edmonton, Canada

 

Contract: $18,000,000

 

Start Date:  August 2011

Campus-Wide Custodial Services

The owner used ASU to apply Best Value to deliver custodial services for its main campus. The risk and value focused procurement approach realized an initial contract savings of $500,000 annually.

ASU provided pre-planning support to the selected vendor to address client concerns and facilitate risk identification, mitigation and documentation.

Highlights:

  • $400k internal savings during the initial year of implementation.
  • Vendor adoption of full QA/QC responsibilities, allowing the Client to internally reassign 3 FTEs to different work on a full time basis (indirect savings of $180k)
  • Satisfaction Rating: 10 out of 10 Rating of Vendor Performance by Client PM

“This process gave Bee-Clean the freedom to find solutions that work for them as well as us, rather than us dictating…they are now coming to us with solutions rather than problems” – George Thomlison, Client PM.

REFERENCE: Brian Stewart, Director of Procurement | brian.stewart@ualberta.ca | 780-492-2775

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