All Posts

There are a lot of pros and cons to both traditional and dynamic e-auction negotiations, but the bottom line is that there are a lot more savings generated with dynamic e-auctions.

Traditional Face-to-Face Negotiation

The duration of a traditional face-to-face negotiation process is typically 3 to 4 weeks, during which the buyer negotiates with approximately 3 or 4 suppliers. This results in a process where each new bid is followed by an analysis in order to determine how to proceed in relation to the negotiations with the remaining suppliers. The cycle time for a face-to-face negotiation is extensive due to the necessity of having several rounds with each supplier individually. The comprehensive process limits the number of negotiations as it is not feasible for either the buyer or supplier to constantly travel back and forth.

Dynamic eAuction Negotiation

The structure of an e-auction differs significantly from the traditional process. All the suppliers are gathered in one virtual negotiation room and submit bids simultaneously. The supplier can immediately respond to another supplier's bid, and the buyer can immediately see the impact on the bid hierarchy. The duration of an e-auction will last an average of 50 minutes with 5 to 6 participating suppliers who improve their bids an average of 23 times during the e-auction.

dynamic vs traditional eauctions

New call-to-action

Henrik Balslev - Chief Commercial Officer
Henrik Balslev - Chief Commercial Officer
Henrik Balslev is responsible for the overall delivery of consultancy and customer services in Europe. In addition to managing many of Scanmarket’s largest customer accounts, Henrik has lead responsibility for sales in the Nordic countries.

Related Posts

Gartner: 4 Major Sourcing Trends for a ‘New Normal’ World

Major risks transform a relatively predictable world into a “new normal” in which the only certainty is c...

Scanmarket Named in the Top 50 Providers to Know

Scanmarket has been named as one of the Top 50 Providers to Know by Spend Matters Almanac.
Betina Nygaard - CEO Scanmarket A/S Oct 12, 2021 9:19:33 PM

eRFx Types and Formats

eRFx is a term used for procurement technology software that allows sourcing professionals to submit an e...