Posts Tagged ‘reverse auction’

Reverse Auction Website

reverse auction | Posted by rosita dian
Feb 05 2010

Tips For Posting Successful Projects

Executive summary about reverse auction by Patrick Hesselmann

reverse auction website

Reverse auction websites allow you to post a description of something you need to have done and receive multiple bids on it. You can apply similar thinking to posting an item you want to buy through reverse auction.

To post a project, you will need to sign up with a reverse auction site, and describe what you want done. Potential suppliers bid on the project, normally in an open environment where they can see each others’ bids. You then select the winning supplier based on what’s important to you: supplier rating, price, licensing, insurance, bonding etc.

You and the supplier contract for the work through the website, and then execute the project based on that contract: The supplier performs the work, you pay according to terms established during the contracting phase. At the end, you each rate the other on their performance: Was the supplier competent, timely, tidy etc.? Specify quality of materials. Most reverse auction websites allow you to attach several files. If you do, two things happen:

You become subject to pressure from suppliers who can contact you and try to get you to sign up with them before you see the range of suppliers and bids available;

The website will probably remove your posting because it violates their policies.

How much material will this project need (i.e. Are the dimensions sufficient for the supplier to calculate his materials).

Where is the project? When does the project have to be completed after bidding is closed? Is timing a critical factor?

Do you clarify where the supplier can modify the approach without harming the project? Are there any specific suppliers you would like to have bid on the project? Taking the time to clearly specify the work required, and reviewing your project from the supplier’s point of view will make for a much more successful outcome. Try posting your next project: You may find it an enjoyable and successful experience.

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Online Reverse Auction

reverse auction | Posted by rosita dian
Feb 03 2010

What is Online Reverse Auction?

Executive summary about reverse auction by Ron Victor

Reverse auction deals with internet auction and e-purchasing. This is also known by many names like procurement auction, sourcing event, e-sourcing, and e-auction. In the case of reverse auction, buyer makes an advertisement on the need of an item or service. The seller who places the lowest bid will win the job or sell the item.

online reverse auction

Lot of planning is required when reverse auction takes place on Internet. In the meeting, purchaser and seller discuss the requested service. If the buyer wants to purchase an item, certain things like age of the item and quality of the item may be discussed beforehand. On average, individuals and companies save from 10 to 40 percent on reverse auction purchases. Reverse auction also saves valuable time of buyers.

As the popularity of online reverse auction has increased, also buying services and supplies online. Savings, simplicity, and selection of reverse auctions make them the ideal choice for anyone looking to join the internet auction purchasing revolution. Certain benefits on online reverse auction are there is flexibility in pricing decisions. Applicability of online reverse auctions is for capital goods, direct materials, periodical rate contracts and large volume goods.

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Reverse Auction Bid

reverse auction | Posted by rosita dian
Feb 02 2010

Top 10 Ways to Identify a Successful Reverse Auction Opportunity

reverse bid auction

Executive summary about reverse auction by Douglas LuthringerBy

  1. The dollar amount should be sufficient to generate the interest of potential suppliers.
  2. You should have at least two qualified suppliers.” You should be able to clearly specify your purchase before you choose to run a reverse auction.
  3. A reverse auction is not an RFP where some details can be left to figure out later. You should be able to clearly specify your purchase before you choose to run a reverse auction.
  4. Define and document award criteria.
  5. Supplier change-over risk is low. Look for areas where the cost to change suppliers is low. Keep in mind that costs are not just a hard dollar figure for the product or service you want to reverse auction.
  6. Have a good forecast of the quantities and dollar volume. You should be able to clearly document what and how much you are buying so you can provide those details as historical data to potential suppliers.
  7. Only include similar items in the same bid package. While you can have many similar line items in a reverse auction, you do not want unrelated items in the same lot or bucket. Keep dissimilar items separate to avoid confusion. This will also allow suppliers to focus on their core competencies, and not disqualify them from bidding if they do not provide one item in the lot you are reverse auctioning.
  8. Keep reverse auctions below ten line items. You want to keep the bidding simple, so do not over-complicate it by adding too many line items to the reverse auction.
  9. Clearly define an alternate submission process. You do not want to leave a potential supplier in the dark about what alternates you are willing to accept, or you run the risk of not having a successful reverse auction.
  10. Are there compressible margins for the suppliers to compete on? Stay away from using reverse auctions on items that have a market traded price such as oil and natural gas. You can reverse auction the distribution of these items though. The idea here is to reverse auction items that have prices set by the decisions of people and company pricing policies, and to avoid reverse auctioning items that have a freely traded market price.

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Reverse Auction

reverse auction | Posted by rosita dian
Feb 01 2010

What is a Reverse Auction?

Executive summary about reverse auction by Jenny Zhang

reverse auction

The lowest unique bid is the amount closest to 1 cent that has only been bid by one person.

Reverse auction turns the traditional auction model on its head by declaring the winner to be the person who places the lowest unique bid. If there is no unique bid at the end of the auction, the lowest bid made by only two bidders is used, and the person who places their bid first wins.

Bid No. of bids Outcome

0.01 cent 4 Lowest, but not unique

0.02 cent 1 Lowest unique bid

0.03 cent 0 No bids

0.04 cent 2 Not unique

0.05 cent 1 Unique, but not the lowest

0.06 cent 3 Not unique

The Use Of Reverse Auctions In Business – Frequently Asked Questions

Executive summary about reverse auction by selectsourcing

In business the use of online ‘e-sourcing’ tools such as e-tenders and e-auctions is becoming commonly used to help buyers achieve rapid cost reduction. In this scenario suppliers are invited to bid for the buyer’s contracts either by submitting their tender online and/or participating in a reverse auction.

e-Sourcing is the use of internet technology used by purchasing professionals to find suppliers and negotiate prices for a wide range of goods and services.
Traditionally buyers send out tenders listing the purchasing requirements and invite suppliers to submit prices. Each supplier submits one bid and does not have the opportunity to adjust his or her pricing in response to other bids. What is an on-line reverse auction (e-auction)?
Reverse auctions are an ideal way for buyers to reduce the costs of goods and services, streamline the procurement process and increase profitability.

A fully managed service incorporates a spend analysis of your company expenditure, suitable selection of e-auction categories, strategic category objectives, supplier research, developing lotting strategies, drafting the Invitation to Tender, management of suppliers, hosting the software, training the suppliers (inc helpdesk), managing the e-auction and post event review.

How do suppliers benefit?
Suppliers benefit in the following ways:-
A more fair, more competitive bidding environment
Ability to benchmark prices across their industry
Shorter sales cycles
Wider access to potential business opportunities

Do Suppliers have to pay anything?
No costs are levied to the suppliers for using our services

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