In the previous post, we discussed the positives to joining a Purchasing Consortium. This post will warn you of some potential pitfalls.
One main concern is sharing information with competitors who may be part of the group. Being part of the Purchasing Consortium means that you must provide your company's spend levels. This information could allow a competitor to figure out aspects of your business that you would prefer to keep private.
Structure of the group is very important. You must consider whether all member companies will get the same pricing structure out of the deal or will larger companies get a better discount because they are buying more of the volume. (Wasn't this what you were trying to equalize/neutralize by joining a Purchasing Consortium in the first place?)
If the group is selecting a new supplier or Sourcing a new commodity, who will be a part of the vendor selection process and who will make the final decision?
Another issue is running afoul of anti-trust laws if companies in the same industry join the Buying Consortium.
For more information, here a couple sources to get you started.
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