Australian Office Supplies Company Complains Unfair Government Tendering

Adelaide-based supplier Penfold by Office Choice (formerly WC Penfold) accused the Australian government of malpractice in printer cartridge supplier procurement, a policy that has caused valuable loss of income and jobs.

Penfold said it lost out to US giants Staples and Office Max in supplying toner cartridges for government photocopies which is a $10 million a year business. The company claims tender rules were changed, allowing for purchase of cheaper, refilled cartridges and brand new ones. Further, Penfold expressed the same cartridges could have been available from them at one third the cost, but the company was never given the chance.

Rebuttal to the allegations by the South Australian Government asserts that 90% of purchased cartridges are new. Urged by the scandal, the government has developed a new tendering process which orders employees to buy cartridges only from contracted suppliers.

Greg Barraclough, Managing Director of Penfold, said, “We were knocked out that we weren’t cheap enough on the originals, so how is that a fair process? How can it be a competitive tender process when we were only allowed to quote on original toner cartridges?” he questioned, adding, “They’ve quoted below cost on a lot of items and then they’ve come in with substitute products.”

According to independent Senator Nick Xenophon, a top-level American audit shows Office Max did the same thing in California, costing local government up to $400,000 extra.