Beginner's Guide to Reverse Auctions

In this guide you will find the great and easy-to-understand materials:

> What is a Reverse Auction
> History of the Reverse Auction
> Why use a Reverse Auction
> The Reverse Auction Process
   1.Category Selection
   2.RFQ Pack
   3.Supplier Search
   4.Qualification Bids
   5.Run Auction
   6.Award Contract
> Reverse Auctions in action

What is a Reverse Auction?..

“In a forward auction buyers compete to purchase assets and the price increases over time.”
“In a reverse auction sellers compete for a contract to supply goods or services and the price decreases over time.”

WHY SHOULD I USE A REVERSE AUCTION?

• Opportunity – You are running a tender where you have good specifications and liquidity.
• Negotiate – You have the quotes already but you want to negotiate the best offer.
• Increasing your options – e-Auctions generate price compression which opens up your options.
• Efficiency – You can negotiate with many suppliers in just a number of minutes.

The Reverse Auction: Benefits for Purchasing

Whilst a reverse auction is mainly used to negotiate on price, the lowest bidder does not always win the business. Often a reverse auction is carried out on “buyers choice” or weighted basis. This allows the buyer the freedom to award to any one of the suppliers based on factors, such as service levels and quality...