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NIGP Consulting


Why Market Research is Critical to the Public Procurement Process

A Moore Business article, dated March 27, 2009; titled Why is Market Research Useful?  The Importance of Market Researchdefines marketing as a process that is intended to find, satisfy and retain customers while business makes a profit. But central to all these definitions is the role of the customer and his relationship to the product (i.e. whether he considers the product or service to meet a need or want).” This business purpose and basis supports the requirement for market research as a key management tool for informed decision-making in a proactive approach.

In public procurement, the need for market research has a different driver than generation of a business profit.  Although, the importance of the conduct of market research in the development of competitive procurements is just as critical.  Without proper knowledge of the available competitive market or its supply chain delivery methods – How can the best sourcing approach be achieved for public procurement’s customers?  Many times, customers believe that because “government” wants something the market can and should deliver – however, the cost of such an approach should be evaluated.  It’s public procurement officers’ responsibility as stewards of the public funds to ensure achievement of the customer needs while balancing the available competition in the marketplace, which can only be achieved through quality market research.

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