The results of independent studies and actual practice consistently confirm the increasing commercial and strategic significance of online auctions for procurement management. Gone are the days where the commerce of raw materials dominated the electronic markets. Nearly all product sectors and many services use the internet as a platform for auctions. It is not without reason that online auctions are advancing to strategic instruments for price negotiations in forward looking purchasing departments.

Advantages

Online auctions play a decisive role in speeding up procurement processing and reducing the cost of materials. With the help of internet platforms tendering, bidding, analysis and award processes are reduced to a minimum. This reduction in time and effort can realistically be accompanied by an increase in added value of at least 7%. Moreover, online auctions are highly transparent and yield immediate benefits such as the reduction of the purchase price for different groups of materials.

Requirements

The aim of online auctions is to achieve significant order of magnitude cost reductions for our clients. The success of this new procurement management tool depends on the careful preparation of the procurement auctions by

• Developing measures taking the individual procurement situation into account
• Defining the framework and rules for the procured goods and the procurement market
• Formulating “auction rules” for the suppliers

Aims and advantages of online reverse auctions

The offered online auction module of THESEN AG provides the following features and results:

• Critical evaluation of the procurement situation
• Critical evaluation of the supplier structure
• Larger reach for price negotiations
• Limited time expenditure
• Reduction of staff costs for negotiations
• Enhanced transparency of the procurement market (price, product, suppliers)
• Intensified competition
• Reduction of procurement prices