Lamar Alexander, who held the top job from 1991 to 1993, has formed Simplexis.com in a bid to cut the average $125 (pound;78) cost of processing each of the 25 million purchase orders issued annually by US schools. He says the service will also reduce the time for goods to be delivered.
More than 100 school districts have signed up for a trial. Savings of 5 to 10 per cent will be produced by pooling orders to win bulk discounts.
Mr Alexander says the firm's resarch indicates that America's 91,000 public schools believed they pay too much for goods and services in a system that was too slow and paper-intensive.
Mr Alexander, president of the University of Tennessee and a former governor of that state, says the service will be free, easy to use and meet all state and district regulations.
Eileen Devonshire of the British Educational Suppliers Association, believes there is a role for a venture such as Simplexis in Britain, but doubts if significant savings would result. Some ciouncils already negotiate discounts with suppliers.
The Simplexis site is at: