Today’s post is written by Robert Rice, Account Manager at SafeSourcing Inc.
True or False
Even though reverse auctions have been used by businesses since the early 2000’s, there is still a misunderstanding on exactly how they can benefit both the vendors and the clients and why and when to utilize the practice. Here I will dispel falsehoods and shed some light on the benefits.
Only large organizations or public owned companies can organize reverse auctions- False
It is true that large companies were first to use this tool, but now reverse auctions have been successfully implemented in all size companies, across all market sectors. All you need is the right tool or hire the right company to facilitate your needs.
Only big organizations can afford reverse auction, because you need to invest a great deal of money and time. Also you need to construct the reverse auction structure-False
Today, SafeSourcing and their E-procurement tools can assist you to achieve savings without wasting time or hire additional staff for a reasonable fee.
Reverse auctions are a short-term method, for organizations that want to save money-False
SafeSourcing can open up doors to companies you might have otherwise thought you could not help, with both short and long term needs.
Reverse auctions are only effective for commodities and raw materials purchasing, and are not appropriate for services-False
SafeSourcing have been successful in all areas. Savings can be easily achieved for service needs through clear requirements with both specifics and cost.
Reverse auctions apply only to substantial budget procurements-False
There is no minimum amount for a successful reverse auction. If it is important to your company, you should choose what gets you the best value.
As you can see, there are a lot of misconceptions regarding the use of a reverse auction. A reverse auction can enlighten you where you stand in the marketplace. You might be very surprised what percentage of savings you are losing.
For more information on how SafeSourcing can assist you in exploring your procurement solutions for your business or on our “Risk Free” trial program, please contact a SafeSourcing Customer Service Representative. We have an entire customer services team waiting to assist you today.
We look forward to your comments.