Reverse auctions represent capitalism at its best by bringing vendors together that might not otherwise be aware of a business opportunity.
Today’s post is by Ryan Melowic Director of Customer Services at SafeSourcing.
Strategic sourcing is critical to any business owner or buyer in today’s market. Strategic sourcing techniques that focus on getting the best deal possible when purchasing products or services should be a part of any organizations procurement strategy. By having suppliers competing for your business it allows an organization to discover the best terms that their particular market has to offer. Most small to mid-sized businesses don’t have the resources or connections available to discover vendors outside of their local market place. By utilizing strategic sourcing tools like reverse auctions, your organization can more effectively control costs, achieve better terms, increase value from existing purchases all while maximizing efficiencies of your purchasing process.
Reverse auctions as a sourcing strategy can have an incredible influence on an organization’s cost of operating their business which speaks directly to the bottom line. Taking into consideration even a small cost savings on products or services can have a value increase that can significantly impact the bottom line. Studies show that just saving 7% – 10% on procurement costs can have a direct increase on an organizations profit margin and in some cases seeing a 30% – 50% increase. Strategic sourcing techniques using reverse auctions can be a great strategy for increasing profit margins.
The strategic sourcing technique of using reverse auctions is just one sourcing strategy that allows organizations to feel confident that they are getting the best deal possible when purchasing products and services. Historically reserved for large corporations and multimillion dollar purchases, today’s newer reverse auction solutions, such as the one offered by SafeSourcing, allows this technique to be available to small and mid-sized businesses and for purchases of all sizes. Representing capitalism at its best, reverse auctions a re a strategic sourcing tool that brings competition together to have an opportunity to bid for business they may not have otherwise gotten while at the same time putting the purchasing power of an organization in a platform where these vendors compete aggressively in a real-time environment for their business.
For more information on Strategic Sourcing Techniques Using Reverse Auctions, please contact a SafeSourcing Customer Service Representative.
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