The way Mark sees it, the City of Toronto’s Procurement Process is flawed. When the City’s operating budget was around $1 billion just ten years ago, one could argue the way Toronto went about procuring products and services back then was acceptable given the numbers were much smaller. Today the operating budget stands at around $16 billion, with $2 billion of that going directly to procurement.
Mark is confident that by making key changes to the procurement process he can save the City at least 10% or $200 million annually. Right now Toronto conducts an open and competitive procurement process when the value of goods or services are expected to exceed $100,000. Mark’s plan is to lower this to $10,000. Why? Because since Covid there are less vendors bidding on City jobs, and when they do they are taking advantage of the situation by submitting bids with margins of 50% or more, when previously vendors would be happy with a 15 or 20% margin.
“Toronto is getting gauged. It really is like legalized theft,” says Mark. “I’ve seen this firsthand with some of my business associates, who literally brag about how they are taking advantage of the situation. They bid high now on City jobs knowing the lack of competitors, combined with high inflation, will ensure they get more than their fair share. This is true of all vendors, who are taking advantage of the situation. This has to stop and a lower dollar threshold will help by opening up the bidding process to more vendors.”
As well, Mark plans on adding more negotiation to City procurement. This will be key, because currently the process allows for only rare contracts to be awarded through negotiation with Negotiable RFPs and Negotiable RFTs.
“It is imperative we add ‘Negotiable’ to RFQs and I will do just that,” promises Mark. “Hundreds of millions of dollars are awarded annually to vendors through the more common RFQs, which are fixed-price submissions. When we start negotiating those on any submissions above $10,000, we will save Toronto millions.”
Follow The Movement
Follow the movement to Get Toronto Moving and sign-up here for news and updates. (Mark promises to keep emails short and somewhat sweet.)