China Internet of Things Issues "Anti-Inner Circle" Initiative to Guide the Standard Development of the Procurement Industry.

The China Federation of Logistics and Purchasing issued the initiative of "scientific procurement, against internal competition, and comprehensively improving procurement value creation capabilities" at the 7th Digital Procurement and Supply Chain Conference for State-owned Enterprises today. It advocates for the industry competition to shift from "comparing prices" to "comparing value, quality, and innovation", providing beneficial guidance for the standardized development of the industry. It is introduced that currently, some enterprises equate cost reduction and efficiency improvement with lowering procurement prices, which easily creates a market cycle of competitive price reduction, squeezes research and development investment of enterprises, and may also generate risks related to product quality. Around the construction of a value-oriented procurement environment, the initiative proposes six self-discipline directions - adhering to high quality, reasonable price, honest cooperation, mutual benefit, and win-win situation; removing all kinds of transaction thresholds to maintain a fair competitive environment; properly coordinating the early stage of procurement to reserve reasonable profit space for product innovation; optimizing evaluation standards to reduce the practice of simply awarding contracts based on low prices; regulating the process of guarantee deposits and payment settlement to ease the financial pressure of suppliers; strengthening industry coordination and self-discipline to reduce disorderly low-price competition. The initiative also proposes leveraging digital means to promote industry quality improvement, and suggests that state-owned enterprises play a leading role, promoting comprehensive cost procurement throughout the entire lifecycle, complying with contractual agreements, and driving the industry to form a positive and orderly competitive atmosphere.