Purchasing Auctions was established in 2008 by Jonathan Rollason, an ex-President of The Chartered Institute of Purchasing and Supply (CIPS). Jonathan enjoyed a long and successful career in purchasing, holding senior procurement appointments at the London Stock Exchange, Nomura International and the Bankers Trust.
As a purchaser, he saw a market need for a low cost, easy to use reverse auction tool. He decided to develop a simple standalone product to avoid the complexity of all-encompassing, intrusive models already available and used in the main by large companies. Following development and rigorous testing, the reverse auction platform evolved an intuitive interface and proofing systems which jointly minimised the potential for error during operation. Its unique standalone capability, simplicity and ease of use make the tool very affordable and hence more universally deployable within smaller purchasing teams and consultancies.
Since its launch in early 2009, Purchasing Auctions has completed reverse auctions valued in excess of £150M for commodities ranging from Personal Protection Equipment and Vehicle leasing through to everyday requirements such as computer consumables and stationery.
The Purchasing Auctions concept is as simple as it is radical. It encourages suppliers to compete for your orders via the medium of a live, open, electronic auction. No further need for hospitality junkets, no more haggling, and you can put the concept of sealed bids behind you!
Major companies and shrewd buyers who thought they were already getting rock-bottom prices have been able to save more than 15%, on average, buying goods, materials, and even services via the medium of auctions.
You can cut costs by automating/computerising orders, payments, and product information and by eliminating the host of faxes and invoices that conventional purchasing inevitably attracts. The problem is, automation attacks only transactions costs. Internet auctions can actually slice the price of the goods and services purchased. That's a formula for far bigger savings!
Traditionally, the buying process is very simple. Before a contract expires, the buyer sends out a Request for Proposal (including specification) to existing suppliers and possibly a few other new candidates. Most RFPs spell out all the relevant detail: including a tight specification, delivery schedule, payment details, how much inventory the supplier might hold, etc. This fine detail can have an enormous impact on the total cost of acquisition. Consequently, when the bids come in, only the products are the same; frequently, everything else is different, from the payment terms to who's responsible for product support etc. So it becomes extremely difficult to pick the best deal. To make matters worse, the bids are sealed, and usually go just one round. The suppliers have no idea what prices their competitors are offering and take a blind guess as to how low they must go to win. This could deter some suppliers from bidding.
In the end, some companies choose the path of least resistance. They know precisely what the current supplier's package is costing them, so why take a chance? If the seller they know is willing to keep the price more or less flat it is likely to keep the business - the incumbent often always wins.
In our view, this does not make sense for the buyer or the efficient and competitive supplier. The problem lies in the opaque RFP process. By standardising absolutely everything in the RFP, Purchasing Auctions introduces fair and open competition via the medium of an auction. Suppliers must offer to deliver the same part to the same schedule, for the same payment terms, etc. Each package is exactly the same, making comparison of the bids relatively simple and all that remains is to find the lowest price.
The best way to do that is through an auction!
However, this apparent panacea to procurement woes introduces another dimension: auctions need thorough & detailed preparation
Purchasing Auctions can assist with all these tasks, but recognise that this can attract further costs and would rather train your staff to prepare for and run your own auctions.
Why not register now to take advantage of this significant opportunity...
Procurement as a business function demands the utmost trust between both purchaser and supplier in order to engender a mutually beneficial and professional relationship. Competition can lead to the introduction of unfair practises by either party to gain advantage.
Our approach at Purchasing Auctions has been to protect the interests of all concerned; to be absolutely neutral and transparent in all our dealings with both our purchasing and supply-side customers. No individuals or organisations will be given any favour or special treatment when it comes to an auction with us. By the same token, we at Purchasing Auctions expect that those involved in a reverse auction will uphold the values and practises that will lead to a level playing field for ALL. Our key business values revolve around honesty, transparency and the best possible customer service to all parties involved at every step of the process.
We therefore expect that participants engage in the auction process with the expressed, genuine intent of proceeding to contract to either purchase or provide goods and services as set out in the auction schedule. Upon implementing an auction, our dedicated and experienced staff will be in touch to ensure you have everything you need to complete the process as smoothly as possible and will even be able to assist with contracting if necessary.
We have designed the Auction process in such a manner that no advantage can be gained by any individual parties over others - the system is as transparent as technology allows, yet sufficiently anonymous to protect the business interests of participants, to comply with data protection legislation and to ensure the security of all participants.
Intrinsic to the design of the Purchasing Auctions reverse auction tool has been a desire to maintain a fair and honest competition for business within a secure web environment. We have made the entire process as transparent, objective and intuitive as possible for the 2 types of auction that we offer. Our technology is designed to minimise the potential for error and we have introduced bespoke mechanisms to apply remedial action in the event of occurrences beyond our control. An auction log details every event on an all-informed basis permitting matters to be dealt with quickly and fairly.
Training in the use of the tool is provided to all clientele with the aim of achieving the same level of ability at auction. Preparation for the auction itself in terms of bid content and pricing is a matter for each participant and the team at Purchasing Auctions will be more than happy to assist with this process.
The auction itself is a highly charged event - called a "Reverse or Dutch" auction because the price starts high and moves downward.
Linked over the Internet, the suppliers don't have to guess what their competitors are up to - they are able to see in real time exactly how much the opposition is bidding (not who the bidder is), - and how low they must go to win the order. The whole event is transparent, quickly concluded and delivers a complete audit trail within a secure and neutral environment. The emotion and negotiating hassle is taken out of the equation and invariably the price is the most competitive available.
For more about 'What a reverse auction is' view our explanation page.
Why not register now to take advantage of this significant opportunity...
Jonathan is a Fellow and Past President of the Chartered Institute of Purchasing and Supply in UK. Whilst he was President he helped introduce the Purchasing Managers Index in UK.
He has over 20 years experience in procurement at an executive level and his career has included being the MD responsible for Global Expense Management at the US bank, Bankers Trust where he was responsible for a $2 billion supplier global expense base. He successfully led a global cost and quality programme which resulted in $200 million of supplier savings. His career also includes a senior position at Nomura, a Japanese investment house, and the position of Head of Purchasing at the London Stock Exchange where he led a number of software development projects.
Jonathan is a Trustee of the Royal Society of Arts in London. Jonathan is also a regular speaker at conferences and events.
James has gained extensive knowledge of graphic design, web development and marketing from his diverse and varied freelance career over the last 10 years. He takes great pride in his quality graphic design and constantly strives to create attractive, contemporary work that has broad appeal. He views each project as a fresh stimulant to his innovation and creative skills; giving each the attention and time to quickly understand the brief and deliver an outcome that not only fits the specification, but is technically advanced and stylish.
James is a keen football fan, husband and very proud father of a future Villa Star!
David Kerr spent over 30 years in the military, specialising in logistics (in particular procurement and supply), officer training and bomb disposal. He has served throughout Europe, the Middle East, Asia and Africa and his role has varied from executive supply to military units, through staff planning and procurement, to consultancy and training of senior military commanders overseas. He has worked in direct support of the United Nations and the British Foreign & Commonwealth Office. On leaving the service he was employed as a Business Development Manager in a precision engineering company prior to joining Purchasing Auctions in 2007 in systems development.
He loves all sport (but favours Rugby Sevens), hill-walking and overseas travel.
Skilled procurement professional with over 10 years experience of purchasing within financial services, telecommunications, print, media and infrastructure companies.
On graduation from the Royal Military Academy, Sandhurst in 1971, Tim was commissioned into the Royal Engineers. In the Army he travelled extensively and undertook a myriad of engineering projects in military settings prior to leaving the service to manage a range of civil, mechanical and structural projects.
In 1982 he moved to South Africa where his civil engineering projects grew in complexity before moving into the IT industry. He became the sub-Saharan Business Development manager for Lotus in 1992 and went on to form his own IT consultancy. In 1998 he added a telecoms company to his portfolio, Voiplus, providing cheap international VoIP phone calls.
In 2011 Tim became the South African Agent for Purchasing Auctions and last year he successfully managed auction lots valued in excess of R400 million using the PA reverse auction platform in South Africa.
Tim is the Civil Engineer for Rescue South Africa, which provides a large and experienced rescue team for deployment to disasters and emergency incidents worldwide. He was involved in relief support in the aftermath of the Haiti Earthquake in 2010 and more recently in the wake of the Philippines Typhoon Haiyan in 2013.
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