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Be forward thinking with reverse auctions
The Internet has re-defined how many industries & supply chains operate
creating high value opportunities and cost savings.
Reverse Auctions are being increasingly used in public and private sectors as
standard practice, both in prime contracts and in securing value in the supply chain.
Suppliers are also realising the benefits of online bidding because of
transparency and increased market awareness.
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The dawn of a new eRA
i2B’s electronic reverse auctions (eRA) is a procurement technique that uses a
secured Internet-based technology to enables suppliers to compete in real time bidding.
Advantages of online auctions with i2B's eRA include
Reduced procurement costs (typically 20 per cent)
Reduced time to market by accelerating the strategic sourcing process
Identify globally competitive suppliers
Shorter negotiation time
Immediate validation of the competitiveness of current suppliers
What is i2B's eRA?
eRA is i2B’s Reverse Auction application that rapidly cuts costs using e-business tools.
Reverse auctions are fixed-duration bidding events hosted by a single buyer, in which multiple suppliers compete for business.
Reverse auctions can lower the cost of procuring products and services, often by 20 percent, making them the e-business
application of choice for companies wishing to increase their bottom line.
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Why should I run a Reverse Auction?
Reverse Auctions offer efficient, open, quick, multi lingual and clear negotiations.
The time needed to carry out competitive negotiations are reduced dramatically, from weeks to hours, as auctions starts at
or near current market price ensuring that you get the best deal.
Supplier capabilities, quality, service levels, and other key issues specific to both the company and the marketplace
can also be used to pre-select suppliers before the auction. Auctions can be designed so that the lowest price does not
necessarily win, other important factors can be evaluated after the event.
Typical Scenario
It is not uncommon for staff to rely on a handful of known suppliers to replenish stock levels, this is more so the case when a
department is responsible for buying their own consumables.
Relying on a group of known, favored suppliers can limited bid competition and in turn could mean that you are paying more for your goods.
By utilizing eRA i2B can help client prepare for the auction by creating a thorough RFQ that clearly details the components’ specifications
generating a comprehensive list of supplier qualifications. i2B can also handle the whole process from inviting the
suppliers through to interactive chat whilst the auction is live to assit in any query’s they may have.
Links
Click here
to access advice if you are thinking about running a Reverse Auction
Click here
to download a white paper by VW on the role of Reverse Auctions in Strategic Sourcing
Click here
to request more information about eRA from i2B
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