Why E-Auction Is The Future Of Smart Sourcing?
Upgrading is at the heart of constant evolution and growth for businesses. E-Auction is one such aspect that can help you level up your current sourcing processes. Traditional sourcing is not only time and cost exhaustive but also excessively manual.
E-Auction comes as a simple digital solution that makes the sourcing process transparent and faster than ever. It offers maximum price compression, effective vendor management, overall improved efficiency and significant cost and time savings.
Accessibility of strong B2B platforms like Bizongo makes the transition to e-auction easier. Let’s break down how real-time online bidding simplifies sourcing and arms you up to get started right away.
Understanding Reverse Auctions
Reverse Auction is the most commonly used method of E-Auction. It works opposite to traditional auctioning, where sellers place a product/service for sale, and buyers bid the highest price - hence, “reverse”.
To reverse auction, you put out your requirement with specifications, terms, and your reserve price for the purchase. This requirement is shared with relevant sellers who make then make a bid.
Competitor vendors see bids. It means they get to tailor their offer to be better than the ones you have already received. Upon completion, you can choose to go ahead with the bidder who can meet your requirements.
Benefits of Choosing E-Auction
While price discovery and ease of use are the most important benefits of opting for eAuction, they’re not all. Let’s go over the other advantages of choosing online bidding that highly streamline your sourcing process.
1. Brings Transparency in the Sourcing Process
As a business owner or buyer, transparently operating your sourcing can help you set fit criteria for vendor selection and add factual reasoning to your decision of choosing a vendor. This transparency can ease the stress of delegating sourcing responsibly.
Conducting sourcing by eAuction, even partially, allows you to get better at vendor assessment and vendor management in general.
2. Fast Track the Journey from RFQ (Request For Quotation) to Vendor Finalizing
Traditional price discovery methods can be time-consuming and labour-intensive. Online auctions let you receive quotes from more vendors than you can by conversing with each individually. You also get to set deadlines and close on a deal upon completion.
Real-time eAuction makes way for real-time assessment and quick decision-making, saving you time and money. Accenture research noted that automation helped reduce invoice processing time by 72% for procurement teams.
3. Avoid Human Bias During Decision Making
A practical decision like choosing a vendor needs to rely solely on merit and numbers. However, whenever humans interact, there is a tendency for emotions to make their way. It leaves scope for manipulation or bias to come in the way of choosing the best vendor.
When you choose eAuction, you take away all other factors and leave only pure facts. Make more thought-through decisions that are unaffected by irrelevant aspects of human interaction.
4. Do Away with Excessive Internal Coordination
Internal coordination can sometimes be the most time-consuming aspect of choosing a vendor. The loops of back and forth, approvals and disapprovals, not only bide time but also weaken your negotiating power.
With eAuction, you predefine the criteria for your awarding process when creating your RFQ. There is, hence, little to no need for internal back and forth when making the final decision.
5. Digitize & Streamline Vendor Management
EAuction lets you relocate your scattered offline vendors to an online platform. Their data, quotations, details of previous transactions, invoicing, etc., are stored online to be accessed easily and in one place, bringing in ease of operations.
Digitising your suppliers can also help them upgrade from their manual techniques and explore the many benefits of participating in online bids.
While we understand that there may be comfort in following the traditional system, the benefits of online auctions certainly outweigh the discomfort of a learning curve.
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Selecting the Right B2B Platform for Sourcing Online
To get started with sourcing online and conducting reverse auctions, you need to opt for a robust B2B platform built to reinforce your vendor management and supply chain operations.
Bizongo is India’s largest tech-enabled B2B platform to fully optimize sourcing.
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ProcureLive by Bizongo offers an end-to-end procure-to-pay solution to transform sourcing with its new e-Auction feature for price discovery alongside other solutions like supply chain financing and digital vendor management.
ProcureLive also provides you with intuitive reporting so you can keep optimizing as you go.
How E-Auction With ProcureLive Works
Simplicity of use is a part of all ProcureLive features. The clean user interface and easy to understand language make the tool uncomplicated to navigate. Here’s a sneak peek into what online e-Auction as a buyer looks like with ProcureLive.
E-Auction as a feature is available as a part of the ProcureLive base platform. One can access it by clicking on the ‘Bidding’ tab on your home page. You can use the Bidding option to perform a quick price discovery activity among your existing vendors.
You can start a E-Auction event by clicking on the ‘Create An Event’ button on the top right.
This leads you to the Create Event page. Here, you can select from your catalogued products the one you want to start a bid for. You can also add more details like the duration of the event, your product consumption rate (‘x’ pieces/month), ex-factory price, location, etc.
After entering the event details, you can add Participating Vendors. Participating Vendors are the vendors, suppliers, or manufacturers that you want to invite to offer bids for your presented requirement.
If your vendor is not active on Bizongo, you can simply add their email ID, and they will receive an invitation to register and participate in your bid. Once you have added the Participating Vendors, your event is ready to be published. You can do so by clicking the Publish button on the bottom right.
Voila! Now that your event is published and live, you can revisit the details, view responses, and even award a winner on the event page.
It is as simple and quick as that! If you’re ready to hop right on, there’s more. ProcureLive also offers additional features like cataloguing, digital invoicing, artworkflow and much more so you can fulfil all your sourcing needs without having to use a different platform for each.
Conclusion
EAuction has the potential to transform how you source. Creating a competitive environment through reverse auctions can bring you the best cost compression and help you save on time and effort.
Partnering with a B2B platform like Bizongo expands the purview of what you can achieve by sourcing online. Simplify price discovery and avoid price volatility while skipping on all the hassle of manual methods, so you can have the peace of mind you deserve!
Get in touch to simplify your sourcing today through ProcureLive and other Bizongo tools.
