Amazon recently struck its first major deal to supply the UK public sector with medical equipment, sparking concerns among some established equipment providers that the online behemoth could soon become a contender for mobility contracts.
Amazon’s £600m contract in Yorkshire will see it supply social care providers and emergency services across 13 local authorities in a single supplier model replacing the current procurement system which involves a number of companies.
In the US, Amazon has been criticised for making public sector procurement deals and accused of snatching business from local suppliers.
But the news of Amazon’s deal led some industry figures to question how far companies like that, which are arguably logistics firms at heart, compete with established equipment providers that focus on the service-user experience.
Cost and delivery is certainly becoming an increasingly important consideration for commissioners but service-user experience nevertheless remains high on the agenda and is not likely to go away, considering the backlash providers and CCGs get when things go wrong for end-users.
Several leading providers in the mobility equipment sector are confident that their experience and expertise trumps what companies like Amazon can offer commissioning groups.
Companies like Amazon are sometimes branded ‘box shifters’ but the efficiencies they can offer can be attractive to commissioners.
Nigel Cook, director of SHEQ at Medequip, which holds multiple community equipment contracts across the UK, said that companies like Amazon “do not have the experience of reverse logistics and the re-cycling of equipment required by the NHS”.
“Neither do they have ethos required in the care sector to deal with vulnerable people with complex medical needs.”
Driving efficiencies is nevertheless still highly important for providers like Medequip. But companies cannot simply keep bringing costs down indefinitely and remain sustainable.
To get an edge of competitors when tendering then, organisations must look at both service delivery and what they can add back, said Cook.
He added: “There’s a bigger emphasis on that so that’s how you gain an edge. You can gain an edge by being cheaper but you gain another edge by offering capability that other organisations don’t have.
“Social value is one example. We would say that our IT system is added value compared to other organisations.
“It is about the way you go about things and the organisation as a whole and how it delivers efficiency and what developments it has ahead of it.”