E-Sourcing Forum » A few quick suggestions for suppliers who come in contact with a Reverse Auction

A few quick suggestions for suppliers who come in contact with a Reverse Auction

May 4th, 2010 at 10:17am David Bush - Iasta

We spend a lot of time in sourcing talking projects from the project owner’s point of view. I want to spend a few minutes and layout a few suggestions for suppliers that are engaged in a project that is a reverse auction.

Have a war room mentality

Have a central location for all bidding and information about the process

Take the time to fully understand the technology being used

View all training materials, and practice bidding to be completely comfortable with the tool for actual event.

Understand the bid package

Review all materials
Know the deadlines, know the bidding format
Take advantage of any opportunity to ask questions for clarity

Most importantly know thyself

Understand your cost structure, relationship with prospect, market presence, lowest price point, and how you compare to your potential competition.

Develop a winning bidding strategy

If you are the incumbent, abide and work with the client to keep a strong relationship.
Lower your bid slowly, retain your margins and take the lead late in the process

Know your numbers

Know your starting price and your walking away price

Post Bid follow through

With the conclusion of the auction, buyers now evaluate all factors to make an award decision. Price is only ONE factor. Make sure they have a positive impression of your company. Even if you don’t win, you want to continue to sustain a strong positive relationship so you will be considered for future projects.

Review

Take the time to evaluate how you handle the process
Review your strategy and anticipate how to be stronger in future auctions
Look for ways to lower your price without reducing quality.

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Entry Filed under: General

3 Comments Add your own

1. Andrew Bartolini | May 4th, 2010 at 6:45 pm

David -

Great post, especially the knowing thyself section. Self-reflection and market information that can result from a supplier’s participation in eSourcing/eAuction can be very helpful in the pursuit of future business.

What do you suggest when suppliers do not want to participate in an eAuction because their good/service is “not a commodity?”
2. jitesh | May 13th, 2010 at 2:18 am

Hi,

I am Jitesh, a Research Analyst with Beroe Inc. We are a procurement intelligence company catering to several FORTUNE 500 companies. I am currently doing a study on, the various tools and processes aimed at increasing the efficiency, collaboration and productivity of procurement department in the CPG industry, for our client, a FORTUNE 500 global CPG major.

I would like to solicit your expertise regarding the same.

We, at Beroe, work with our network of industry experts who we consult with whenever a requirement arises in the category. By providing your expertise for this particular study, your name will be added to our database of experts and you will also be contacted for future expertise requirements in the technology services category.

It would be great if you could forward your e-mail id so we may discuss the matter further.
Regards,

Thanks & Regards,

Jitesh Nangia,
Research Analyst, Beroe Inc,
3. tony | May 27th, 2010 at 12:28 pm

Great post David. Good advice is timeless:

http://www.esourcingforum.com/archives/2006/04/05/qa-with-tony-poshek—auction-strategies-for-suppliers-part-1/

http://www.esourcingforum.com/archives/2006/04/06/qa-with-tony-poshek—auction-strategies-for-suppliers-part-2/

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