A buying group can be defined as several independent companies, typically in the same or similar businesses or industry that leverage their combined purchasing power in exchange for better pricing and terms on certain products. These products are purchased by the buying group and then sold to members of the group.
Unlike a buying group, a GPO does not purchase any products. Instead, they leverage the combined purchasing power of a group of similar businesses and negotiate special pricing contracts directly with manufacturers. The contracted savings are then passed on to the GPO members.
The National Service Alliance (NSA), which started in 1996, is today the leading GPO for building service contractors (BSCs) and related businesses serving some of the largest BSCs in the United States.