When vendors compete on price, you win
In addition to sourcing and quoting, EC Sourcing Group offers many secondary negotiation options, including standard forward and reverse auctions and Soft Auctions, which are a good alternative to the traditional reverse auction process. Auctions help ensure that you achieve true market pricing for any goods or services in the shortest time possible. As with all of our solutions, our auction capability is straight forward, robust, easy to setup and can manage virtually any bid template need – from standard commodities to complex total cost of ownership formula-based purchases. Our reverse auction software includes the powerful features you need and links seamlessly with our eRFx module.
- Speed: negotiation takes less than an hour – in some cases 20 minutes.
- Value: savings are typically greater; average over last two years versus historical prices: 17.6%
- Fairness: full market transparency; all suppliers have same information at exactly the same time.
Reverse Auction Case Study:
So what is a Soft Auction anyway? A Soft Auction is a web-based eRFx followed by secondary bid rounds accompanied by tailored bid feedback provided to the suppliers. In many cases, the eRFx will include survey questions and the secondary bids rounds may include fewer suppliers than the first round of bidding. The bid feedback can be very specific or general and is viewed on-line by suppliers. The secondary bid rounds are performed in the same manner as the first bid round – online and over the course of days or weeks as the project dictates.
Keys to successful online reverse auctions:
- Prepare thoroughly. Know your market. Know your suppliers and internal customers.
- Prepare a thorough RFI / survey to qualify all bidders.
- Establish good communication with suppliers. Clearly explain what your goals are (cost, value, etc.)
- Prepare a thorough, spec based pre-bid (unless the bid is a true commodity). Do this offline or use our eRFx module to simplify and streamline the process. This step is crucial. It can help develop better auction strategy or indicate that you should skip the auction.
- Allow the suppliers to view / play in the auction environment before the auction starts.
How a Reverse Auction Can Benefit Your Budget
5 Things You Didn’t Know Could Be Reverse Auctioned
The Science Behind the Reverse Auction: How to Get the Most Out of Your Money
We selected EC Sourcing to facilitate our purchased services and capital equipment bidding processes. Since implementation over 4 years ago,we’ve had great success using the solution to generate savings and leverage the automated web-based platform to increase visibility and cross functional team participation, improve bid process cycle time and overall organization to provide a more formal straightforward bidding process. We have found the solution to be easy for all parties with high vendor participation. We have used the solution to negotiate small buys and extremely large capital purchases with success on all levels. Lastly, EC Sourcing Group has provided a high level of support both on technical matters and strategic sourcing strategy.Ken Macon
Your software is great! I have been involved in many of these (e-Sourcing negotiations) and in fact just finished one last week for Schering Plough. Your software is much less complicated and more user-friendly than any of the other ones I have used.Jean Labanowski