A major event is slated to take place this summer in Brazil.  Ticket sales may be down, but procurement activity is up.  The 2016 Brazil Summer Olympics are coming up fast with opening date of August 5th, being only weeks away.  Have you ever wondered what goes into making an event the size and scale of the Olympics happen?  An awful lot of procurement activity is required to execute such a large event.  According to the Rio 2016 website, 30 million items were needed ahead of the games, with 85% of them acquired by December 2015.

Can you wrap your mind around 30 million items?  That is a number most people do not work with regularly.  Let's break it down.  Of that 30 million items needed for the games, there are over one million pieces of sporting equipment needed. Just as obvious, think about all the mouths there will be to feed. It is estimated that 14 million meals will be needed in order to feed the athletes, delegates, and workforce.  After all that, keep in mind that other equipment is needed, materials, transport, as well as the horses needed for certain events.  

The Rio 2016 website provides a wealth of insight into the procurement activity of the 2016 Brazil Summer Olympics.  There are contracts in place with 2,500 suppliers, including Brazilian firms of all sizes. There are 85,000 contractors then additional volunteers and staff as well.  Clearly, this is a massive operation.  For such a massive operation, there is a procurement process in place that includes initiatives for sustainability, recycling of material, preservation of the environment, careful use of water and energy, monitoring of work practices, and development of the local market.  Naturally, the procurement procedures also take into account price and quality too.  There are published guides to help suppliers with training, company diversity, and waste management.

At this point, you might be wondering how much all this procurement activity costs.  The budget is set at  R$3 million, half of which was spent by January of 2015.  Despite the high price tag, Brazil aims to leverage the games and all the procurement activity to help develop small businesses throughout the country.  The Brazilian economy has been stuck in the worst recession of 25 years, yet the Olympics offer an opportunity to help stabilize some of the local businesses throughout the country.  The sustainable development of the national market has been a key goal of Brazil and the motivating reason behind the signed technical cooperation agreement called Sabrae on the Podium, which was put into effect well in advance on July 2, 2013.  The main goals of this agreement include maximizing local purchases and the development of a local market place, meeting the demands of the Olympics without harming the market, the existence of a competitive market that meets high standard requirements in sustainability, transparent communication, and a dissolution strategy.

Regardless of intended objectives within the procurement process, the world will see on August 5th all the fruits of the 2016 Brazil Summer Olympics procurement activities.  As of April, half of the event tickets were sold and the rest of the world will watch or listen via live broadcast.  As activities pick up pace and the calendar winds down, will Olympic procurement activities successfully establish cost savings or will the budget be busted?  Managing procurement is a critical component to finding cost savings.
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Maribeth Klingler

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