Less than half of buyers use electronic reverse auctions

According to a survey published this week in Supply Management 60% of respondents do not use reverse e-auctions. Read the article here: http://www.supplymanagement.com/EDIT/Top_stories_item.asp?id=17116

Reasons against electronic reverse auctions include “it will damage supplier relationships” and “in industry X it’s still a problem finding suppliers that use e-mail.”

Reasons for electronic reverse auctions include reductions in administration and preparation time; easier comparison of data.

From my perspective it is puzzling that so many buyers are not even considering e-auctions. While I wouldn’t say that everything can always be auctioned effectively, there are always going to be categories that buyers will be able to achieve more (quality, savings, sustainability – whatever floats your boat) through the considered application of an e-auction.

A decade into the e-auction industry and there is still a whole lot of educating to be done amongst buyers about when and how to take advantage of reverse auctions.

I’ll say one thing (again): e-auctions are a tool. e-auctions do not damage supplier relationships, if you run then well. If you run an e-auction professionally and carefully you can get the best price in the market while still maintaining supplier relationships.