Assistant Director of Asset Management
GENuS is a consortium of four housing associations based in South East Wales who have come together to bring efficiencies to their maintenance and new home building programmes. Melin Homes, Newport Housing Trust, Monmouthshire Homes and Seren Group have a great deal of experience of working together and GENuS builds on these successful relationships.
Number of properties and location:
Almost 3,000 properties in the south east of Wales. GENuS as a whole represents approx. 12,000 homes throughout South East Wales.
What volume of business do you put through PfH's Materials Agreement?
At Melin Homes, we expect approx £175K to go through the Materials Agreement with local builders' merchant Robert Price and a further £100K to go through PTS plumbing merchants per annum. The £175K is split between two contractors - AP Waters and Glanmor Developments. They are both local SMEs and the benefits to them include electronic billing, the security of purchasing with set prices and the ability to influence stocking profiles. The trust in this relationship allows far greater flexibility for these SMEs, putting them on the same footing in terms of billing and relationships as the larger national companies.
What benefits has PfH created for your organisation?
Before this contract we had no or little involvement in materials procurement - for planned projects we would provide a specification to the contractor, for reactive we would expect 'like for like' replacement. Now we have far more input in terms of materials and components, allowing greater normalisation across our stock - good for residents, us and contractors.
Was it easy to set up with the Account Cards?
Yes. PfH and their Welsh partner, Evolution IP, brokered the arrangement (the first of its kind in the UK), whereby our framework contractors were able to join PfH as associate Members. This meant that Melin Homes could take advantage of the procurement packages whilst still ensuring contractors were central in purchasing materials and they could bring their expertise to the arrangement.
How did you make changes with your contractors? What advantages did you see?
A major benefit is seeing the merchant as a partner rather than just somewhere you would pick up materials. Robert Price have worked with us and our contractors in securing new floor coverings for our planned kitchen replacements - may not sound exciting but it is! We are now using laminate flooring which, initial feedback from residents indicates, is far preferred over the non slip equivalent, at a significantly lower cost for materials and installation. This will reduce our kitchen replacement costs by approx 8% per kitchen. Robert Price are holding stocks of our choices at key depots ready for contractors to take away as required. It feels like, and is, a real three way partnership.
What savings do you expect to make annually?
As the 'end user' we would expect to see a reduction in our costs of approx 15%. This is not a straight saving in terms of material prices but is made up of a number of factors: the materials costs are reduced; costs are transparent; e-billing gives a saving of 5-6% to our contractors which is passed onto us; there are less travel costs as Robert Price stock their depots in line with our requirements (e.g. the correct size and type of door in the right depots etc); Robert Price work as our 'expert advisers' - they have sourced new products and acted with us in securing those products and fitting advice.
Have you managed to reinvest your procurement cost savings? How will your residents and their neighbourhoods benefit?
The cost savings we make are being reinvested via both our planned and reactive services, completing significantly more kitchen and bathroom replacements as a result of these services. We are also investing locally in terms of increased apprenticeships with our SMEs and supporting merchants based within our area.
We are also realising additional savings in 'back office time' by setting up these procurement deals in terms of the time we, and our contractors, spend on sourcing materials. This time is then reinvested in making further improvements to our services, with a direct benefit to our customers.
What would you say to other housing organisations that are considering becoming PfH Members?
They need to establish the 'right' relationships with contractors and merchants. A positive and open relationship is essential. Let PfH sort out the nuts and bolts of making this work, then spend time working on making savings to processes and identifying improvements.