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A "purchasing cooperative" is a type of cooperative arrangement, often among businesses, to agree to aggregate demand to get lower prices from selected suppliers. Retailers' cooperatives are a form of purchasing cooperative. It is often used by government agencies to reduce costs of procurement. Purchasing Cooperatives are used frequently by governmental entities, since they are required to follow laws requiring competitive bidding above certain thresholds. Counties, municipalities, schools, colleges and universities in the majority of states can sign an interlocal agreement or contract that allows them to legally use a contract that was procured by another governmental entity.
An example of this is Harris County Department of Education, a governmental organization that created three procurement cooperatives: Choice Facility Partners, a facility services cooperative the Gulf Coast Cooperative, a food cooperative primarily serving schools; and the HCDE Purchasing Cooperative, offering more than 275 vendor contracts for commodities. Schools, colleges and universities, municipalities, counties, municipal utility districts and other governmental entities sign an interlocal contract with HCDE, thus becoming members that can access any of the multitude of competitively bid and legally awarded contracts available in through their cooperatives. To optimize processes, Choice Facility Partners, HCDE Purchasing Cooperative and the Gulf Coast Food Co-op, were combined into Choice Partners national cooperative in 2012.