Tempe Rejects Purchasing Contract With Amazon

By Mariana Dale
Published: Monday, November 26, 2018 - 5:05am
Christina Estes/KJZZ
An Amazon warehouse in Phoenix.

Tempe leaders have rejected a new contract with Amazon based on the advice of city staff.

The city already purchases a variety of things from the online company.

Governments around the country can use the cooperative contract to do business more easily with Amazon. One benefit Tempe hoped to gain through the contract was a free Business Prime account, but that promotion ends in January 2019.

“As a result of Amazon’s decision, staff believes there are no longer any compelling reasons to adopt the U.S. Communities contract,” staff wrote in a memo to city council.

City Council members had previously expressed concern with Tempe’s growing Amazon expenditures.

“We’re looking for opportunities to involve our local vendors and our local store owners and operators in helping the city buy things at the best price,” said Tempe CFO and Deputy City Manager Ken Jones.

Staff recently reviewed the city’s Amazon spending and found the total down 17 percent in the first four months of this fiscal year compared to the previous one.  

“Not because we think Amazon purchases aren’t good,” said Jones. “Sometimes they offer the best price for the best product and a reasonable delivery… it’s because they shouldn’t have been purchasing it because it was available on an existing contract.”

Jones said staff have been instructed to consider existing suppliers when considering whether to buy something from Amazon.

Tempe held a forum where local businesses could learn more about working with the city in October that attracted 17 companies.

Tempe Staff Memo On Amazon

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