Amazon has struck its first major deal to supply the UK public sector with a £600m contract in Yorkshire which will include the online behemoth selling medical equipment to social care providers.
The firm will also provide emergency services and schools with various supplies across 13 local authorities in Yorkshire in a deal that covers education, local government and care.
The one-stop-shop approach of having a single supplier will replace the current procurement system which involves a number of companies supplying councils.
Amazon signed a five year contract with procurement body, Yorkshire Purchasing Organisation (YPO), which is owned by local authorities and is designed to keep costs low by making deals with suppliers for bulk orders.
A dedicated site will be set up by Amazon and it is estimated that it will be worth £600m during the five year contract, according to a national newspaper.
Gus Tugendhat from data company Tussell, which tracks public sector contracts, told the Telegraph: “Having revolutionised consumers’ retail habits, Amazon’s next step may be to do the same for public sector purchasing.”
YPO reportedly published a contract notice implying that Amazon was “the only viable contractor currently operating in the market”.
Amazon already sells a wide range of care and mobility equipment direct to end-user and has made similar public sector agreements in the US. But this is the first such deal to have been made in a UK region.
In the US, Amazon has been criticised for making public sector procurement deals and accused of snatching business from local suppliers.
Amazon Business launched in the UK in 2017 to spearhead the group’s move into the multi-billion pound business-to-business market.