“Transparency increases the cost of hiding the truth.“
(D. Peppers & M. Rogers)
How do suppliers benefit from eAuctions?
One of the most powerful features of today’s procurement softwares are eAuctions. In Procurement, two types of auctions are being used. The most frequently used auction model are reverse auctions – the ones in which the roles of buyer and seller are reversed, and the price typically decreases. On the other hand, we can find “ordinary”, also known as “forward” auctions. In forward auctions, buyers compete to obtain services or goods by offering increasingly higher prices. However, reverse auctions are becoming more widespread in modern Procurement since they bring many benefits – as for buyers, thus for suppliers. It’s pretty clear how eAuctions benefit buyers – with eAuctions, they achieve lower prices. But what benefits do suppliers have? We bring you three most important benefits below:
1. Same conditions for everyone
By using eAuctions, the number of arrangements “under the table” is reduced. All suppliers have the same terms and conditions clearly defined in tenders and therefore have the same opportunity to participate. In Ensolva, all offers are submitted anonymously and thus favoring any of the suppliers is avoided. This is to ensure that the bid that really proved to be the most favorable is winning in the auction. By the end of the auction, each supplier has insight into results and can compare his bid with the one that won.
2. Not constrained by location
Before the introduction of information technology in business, it was often the case that certain bidders that wanted to participate in auctions and met all the terms defined in tenders, could not participate because of geographical constraints. This way, not only suppliers but also buyers experienced loss. By implementing software solutions in Procurement, such situations are no longer a problem because suppliers from any part of the world where there’s Internet access can be invited to place their bids. With Ensolva, reach markets that previously seemed impossible!
3. Market transparency
eAuctions are the place that brings together a large number of bidders who meet the conditions set by the buyer. By using eAuctions, healthy competition and competitive spirit is encouraged, helping all participants to see real market prices and identify areas that need to be improved. Having insight into the real market situation, suppliers have the opportunity to constantly be up to date and improve their business models.
eAuctions bring numerous benefits – as for buyers, thus for suppliers. With the introduction of procurement software solutions, new market possibilities opened and transparency improved. Procurement softwares solved significant problems Procurement met earlier and thus simplified exchange of goods on the global market. Improve your business with Ensolva and take advantage of opportunities you didn’t even know before!