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They say the reverse auction got its start around the 17th century in Holland, where traders offered up Ottoman Empire tulips in an array of colors never previously seen in the western world. Sellers of the then-rare flower bulbs would begin the bidding at a sometimes implausibly high price, cross their fingers, then drop the ask bit-by-bit until buyers nabbed the exotic blooms for the best deal they figured they’d get.
Today, says David Coffey, Director of the Clearview Group, a procurement company in Dublin, Ireland, the reverse auction could be for just about any product, or even a service.
“There’s typically a tender process that you would put an organization through, where you have them compete,” says Coffey.
Once buyers are persuaded that they’re negotiating with reputable suppliers, both price and quality are evaluated. And that’s where the electronic auction makes the difference.
How, exactly, does it work? A typical auction might include six or seven suppliers. Coffey says each supplier is trained by Clearview, gets a user name and password to connect to a remote site, and is told the time to log in as the event begins. The auction may be based upon price and quality, or price only. Suppliers can see their own opening scores and bids, and how those bids rank, but not the bids of the other suppliers. Nor are they told who they’re competing against.
The competition begins, and the clock starts to count down.
“If this is a big contract, and you started in first place but now you’re in fourth place, and there’s three minutes of this event left, you better get a competitive bid in and you better do it quickly,” says Coffey. “As a buyer, if you’re looking at this, you should be seeing a downward curve from a pricing perspective across the suppliers.”
Though the suppliers competing for the prize might be SMEs, the buyers are often very large corporations. So the entrepreneur who keeps a cool head and knows his or her bottom line just might end up with the deal of the decade.
But where do you find out about these auctions?
Coffey says that buyers can contact Clearview to plan, structure and manage their eAuction. For interested suppliers there are national tendering systems, such as e-Tenders in Ireland where buyers post all sorts of needs—printing, facilities management, you name it. The European Union and United States have similar systems. “There are private sector networks as well,” he says, where suppliers can post their services and buyers can post their requirements.
For those interested in competing in this potentially lucrative arena, Clearview is creating technologies that will connect buyers to suppliers.
“We also aim to help buyers to manage their suppliers and risk while accessing market intelligence. We are working to create a LinkedIn for procurement, if you will, where people can talk and reference, and get guidance.”
| Product Model | Inside Diameter | Outside Diameter | Thickness |
| HMK2120 NTN | 21 | 29 | 20 |
| HMK2116 NTN | 21 | 29 | 16 |