Which type of purchasing requires coordination among multiple units for better pricing?

Group or co-op purchasing involves multiple units or organizations collaborating to buy goods or services together. This collective approach allows these entities to leverage their combined purchasing power, leading to better pricing and terms from suppliers. By pooling their resources, they negotiate larger quantities, which suppliers are often willing to discount. This method can significantly benefit smaller organizations or those with limited purchasing power when they collaborate, achieving cost savings that might not be possible individually.

In contrast, formal purchasing refers to a structured process often characterized by specific protocols and regulations but does not directly involve multiple organizations. Centralized purchasing involves a single entity or organization managing the procurement process for all units within an organization, which can streamline operations but may not focus on external collaboration for price improvements. Individual purchasing is straightforward, with single units making purchases independently, without the advantages gained from collective negotiations. Thus, group/co-op purchasing is the most effective approach when seeking better pricing through coordination among various units.