Etiket arşivi: E-procurement software

HOW TO IMPROVE COMPETITION WITH FEW SUPPLIERS

The use of on-line auctions (e-auction) has increased rapidly in the last few years. Since they came onto the purchasing scene in the late 1990’s through the development of internet-based applications but just like with every other breakthrough events and technologies, e-auctions too come with its attendant risks and it is important that buyers and suppliers understand what these risks are so as to mitigate against its effects. Some of these risks are;

  • Bids not having enough qualified and competent suppliers;
  • suppliers not being able to demonstrate the overall value of their product or service and
  • Oversimplification of requirements to ‘fit the system’.

Without effective change management expectations may never be reached and inexperienced suppliers may bid below a sustainable price which makes the entire process unattractive to qualified and competent bidders. If a supplier suffers from a bad e-auction experience, then it is likely they may be reluctant to enter into the process again. Try to make sure that before rolling out an e-auction programme, the process is as fair and transparent as possible and has been approved by a pilot group including suppliers and that feedback from the pilot process is enacted on.

Some of the reasons why suppliers may be reluctant to participate in an e-auction bidding include;

  1. Unsuitable commodity/service – this might be an item where there is no competition in the market place, or that is too complicated to specify or largely cannot be specified
  2. Lack of competitive supply base – if a product or service does not have at least three suitable suppliers, then the e-auction process is not generally suitable
  3. Poor training of buyer/supplier – getting things right first time is imperative to build trust amongst suppliers in your company’s e-auction process
  4. E-Auction timing – If you are inviting suppliers to participate from a different country and time zone, take care that if the timing chosen to run the auction is convenient to those suppliers.

So what if you are running a bidding process and there are not enough suppliers to make the process as competitive as you would want, what do you do?

Highlighted below are some of the strategies you can adopt to find your way around that problem

1.Supplier implementation

Firstly the best good advice I can give to you is that it is important to get supplier input during the pre-bid (for example through participation in building the RFx) to ensure that they feel a part of the process. One key advantage of this is that this dampens emphasis on pricing and buyers and suppliers can focus on understanding and meeting technical elements of the bid, i.e. meeting the customer’s real needs and this can help to produce the desired results even when participation is not very robust.2.

2.Getting supplier buy-in

There is more supplier acceptance of online auctions than there once was, but still you need to tread carefully to get their buy-in. Visit suppliers or invite them to briefings to explain carefully the principles not just of auctions, but more broadly of online sourcing. They will have concerns, but they will have useful input too: they know their businesses better than you do, and what they tell you will help you optimise your strategies for online bidding events. As a result of hard talking up front, online sourcing will help you to create precise and detailed RFQs that will improve communication and reduce business risks further down the road.

3. Driving Best Practise

In order to improve on the numbers and achieve a more competitive bidding process, a procurer needs to put some people, process, performance measurement and knowledge capabilities in place. The first requirement is a clear understanding of the supply base and the criticality of each supplier to the business. Typically an organisation can segment between strategic partners, value-added suppliers and commodity product suppliers. One will also need to build up market intelligence in order to gain a clear understanding of the dynamics of the market sectors and to define sector strategies – for example properly crafted online RFQs and RFPs can help expedite the communication between buyer and suppliers and can help drive a standardised sourcing process across the organisation.

4.Training

Lastly the importance training and retraining of suppliers as to the workings of your online procurement process cannot be overemphasized. Many buying organisations underestimate the amount of time it takes to educate suppliers in online auction tools. Suppliers with less tech-savvy sales teams may need some extra handholding through their first events, and here the assistance of the auction technology provider can be invaluable. Bidders need feel more comfortable about participating in the process especially when there is a limited number of them.

E-ihale,Elektronik ihale Uygulamaları

Elektronik ihale artık dünyada olduğu gibi Türkiye’de de etkisini ve gücünü göstermeye başladı. Hemen hemen tüm büyük firmalar e- ihale sistemi ile tedarik zincirini iyileştirip güçlendiriyor. Sadece Türkiye’de değil dünyadaki büyük satın alma gücüne sahip firmalar ile buluşma imkanı sağlayabiliyor. Birden fazla tedarikçinin bulunduğu e- ihale platformunda bütün tedarikçi firmaar birbirinin alım gücünü görebildikleri için de haksız bir rekabet ortadan kalkarken tedarik zinciri oluşturmak isteyen firma için de çok iyi bir kazanım sağlanıyor. E- ihale hizmeti veren firmalar çok iyi seçilmeli ve çok iyi bir raporlama süreci sunmalıdır ki bu sistemi kullanmak isteyen firma en iyi kazanımını sağlayabilsin.

E-ihale yöntemlerine ve uygulamalarına bakıldığında bu avantajlar göze çarpıyor. İyi bir ihale sonucunda yüksek kazanım, şeffaflık, doğru rekabet,iyi bir raporlama vb e- ihale uygulamalarında bu avantajlar sağlanırken şirketler de e- ihale yöntemini kullanarak bu uygulama ile gelişmeye devam ediyorlar. Bu sayede de e- ihale uygulamaları da Avrupa’da olduğu gibi ülkemizde de gelişerek ve hızla yayılarak büyüyor. Bu da tedarik zinciri için  en iyi fiyat teklifi anlamına gelebiliyor.

Elektronik ihale bir şirketin tedarik zincirini alımındaki en son aşamadır. E-ihale uygulamasında alım konusunun başarılı olabilmesi için öncesindeki hazırlık aşamaları büyük önem taşımaktadır. Alıcı firmanın ihaleden kazançlı sonuç alması için iyi bir hazırlık sürecinden geçmiş olması gerekir. Satın alma işlemleri sırasıyla satın alma talebinin yetkililere ulaşması ile başlar ve devam eder. Bundan sonraki adım ise idari ve teknik şartların belirlenmesidir. Alım sürecinde hizmeti belirlenen şartlara göre tedarik edecek ve tedarik zincirini oluşturacak firmadan ilk teklifler alınır. Bu süreç ile e- ihale uygulaması devam eder. Tedarik zinciri oluşturmak isteyen firmaların ihalesine yapılan bu teklifler değerlendirildikten sonra e-ihale sürecine geçilir.  Alımın e-ihale ile sonuçlandırılması içi uygun koşulların sağlanması ve kazancın bu uygulama çerçevesinde olması son derece önemlidir. E- ihale sürecine dahil olacak firmalar ile teknik bilgiler eksiksiz ve eşit şekilde paylaşılmalıdır. Eksik bilgi ve yanlış bilgi ihalenin başarısızlığına neden olabilir. Bu yüzden iyi bir elektronik ihale hizmeti veren firma ile çalışmak önemlidir. Tedarik zincirini satın almak isteyen firma tekliflerini hep belirli düzeyde yapmalıdır. Yani verdiği teklifler arasında uçurum var ise bu olumsuz bir sonuçlanmaya neden olacağı için başından beri verdiği teklifte istikrarlı sürekli artan ya da azalan bir teklif sunmalıdır. Satın almayı isteyen firmalar arasında kalite, içerik ve teknik açıdan eşitlik olması söz konudur. E- ihale uygulamasında şartlar her zaman eşit olmalıdır.

E-ihale uygulamasının başarılı olabilmesi için aynı zamanda da tedarikçi firmanın yani ihaleye katılacak satın alma gücüne sahip olan firmaların sayısının yeterli olması gerekir. En az iki firma ile ihale yürütülmelidir ki iyi bir rekabet ortamı sağlanabilsin ve tedarikçi firmalar eşit şekilde rekabet ederken alıcı  firma da kazanımını sağlayabilsin. E-ihale uygulaması son bulduğunda ve ihale sonuçlandığında alımı gerçekleştiren firmanın kararını tedarikçi firmalara bildirmesi, bir sonraki alım süreçlerini de etkileyecektir. Kalite buna göre artacak ve e-ihale sistemine talep de buna doğru orantılı olarak yükselecektir.

E- ihale uygulamalarında satın alma güçlerini kontrol edebilmek ve adil bir rekabet platformunda satın alma gerçekleştirmek firmalar için büyük avantaj sağlamaktadır. Firmaların e-ihale uygulamalarında kazanım sağlayabilmesi yine belirtilen kriterlere uyması ile olabilir. Yine de dünyada ve  Türkiye’de bir çok büyük şirket tarafından uygulanan bu yöntem doğru yol izlendiği taktirde asla kaybetmeye olanak vermeyecektir.

E-Auction in the cloud system

E-Auction in the cloud system

Cloud computing has recently emerged as a new computing paradigm that enables prompt and on-demand access to computing resources. This is exemplified in Amazon EC2 and Microsoft Azure. Cloud providers invest substantially into their data centre infrastructure, providing a virtually unlimited “sea” of CPU, RAM and storage resources to cloud users, often assisted by virtualization technologies. The elastic and on-demand nature of cloud computing assists cloud users to meet their dynamic and fluctuating demands with minimal management overhead, while the cloud ecosystem as a whole achieves economies of scale through cost amortization.

Cloud computing is usually large-scale, distributed computing leveraging Internet-accessible data centres that provide computing resources as cloud. Modern Internet applications are designed using the virtualization technology in the cloud computing environment. Such cloud-based Internet applications are deployed on virtual machines (VMs), also called instances whose resource requirements are pre-configured.

Latest developments in cloud computing technologies have enabled a plethora of cloud based data storage services (e.g., Amazon S3 [1], Dropbox, Google Drive, SkyDrive et.c.) Cloud storage service has gained widespread recognition and adoption by Internet users, many of whom now routinely execute online storage and online backup tasks over the cloud.

In similar vein cloud based auctioning is becoming increasingly important as part of the strategic sourcing process because this allows you to track all aspects of an e-auction, including actions taken by both sellers and bidders. This automated auction processes puts companies ahead in time and also simplifies the entire cycle of activities. Some of the great features of a cloud based auction system include;

  • No investment is required for cloud based E-auction.
  • It’s a Pay per use utility
  • You can prepare, manage and end auctions on it.
  • It allows you to run an auction via the web and podium simultaneously.
  • It reports cost implications, cost reductions etc, and lots more.
  • Return on investment is high
  • Cost is based on yearly license

Usually, a cloud based auction system manages the entire auction process. This makes it simple to set up online auctions which are intuitive to use by both buyers and suppliers, meaning that little training is required. Auctions can be open to all verified suppliers or focused on specific groups. Buyers and sellers can monitor their auctions in real time via an online dashboard. This is accessible in the office and on the road via tablet and smart phone. cloud based auctions also features a bidding timer which counts down until the auction ends. All parties can see the competitive bids as they are made via graphical and tabular displays. Suppliers execute their bidding strategy online, choosing when and how much to bid in relation to their competitors, until the auction ends and closes to inputs.The system also documents the auction process and keeps an audit trail to ensure your organisation can answer any retrospective queries or challenges.

Pay per use utility in the cloud system makes it suitable for experimenting on how it can accrue benefits to the business before it is fully adopted. In most cases buyers can test the functionality through demos, which are generally free for one time e-auction, allowing users to practise creating an event prior to purchasing a license.

Despite these numerous benefits associated with cloud based auctioning, the system is still not without its shortfalls and the two most significant of these are:

  • Firstly, the storage service highly depends on centralized data centres in the cloud, accidents and natural disasters (fire, earthquake, power outage) will have significant impact on the service performance.
  • Second, the cloud storage providers face significant cost in purchasing or renting real estate, cloud infrastructures, hardware, power and network bandwidth.

CONCLUSION

Buyer-assisted cloud storage is emerging as new, exciting hybrid architecture for online storage systems that represent a potential win-win solution for both cloud storage providers and cloud users. Online procurement auction for resource pooling by the provider which serves as a financial catalyst for bringing buyer-assisted cloud storage into reality is gradually becoming the norm. Procurement organisations that want to create a structured process around eAuction must adopt this system in order to stay ahead.

Things Bidders and Suppliers want to Know from Buyer

So you’ve been asked to participate in an e-sourcing event. Now what?

Whether you’re new to e-sourcing or have plenty of experience, every e-sourcing invitation represents a valuable chance to help your business succeed. By participating in e-sourcing events, you can:

  • Win new contracts
  • Grow existing accounts and strengthen customer relationships
  • Gain crucial visibility with targets and prospects
  • Get a clear sense of what competitors offer and a better grasp of your market position
  • Level the playing field with sellers of all sizes
  • Hone your value proposition to capture follow-on business

Bidders/Suppliers are without doubt very essential to almost every business. Without raw materials to make what you sell or manufacturers to provide what you resell, you will have a tough time growing. There are also many supplies and services your business consumes as part of general overhead, from paper clips to Internet access. In some cases, this relationship can go beyond the usual bid and supply of goods and services you need to do business. Bidders/ Suppliers can also be important sources of information, helping you evaluate the potential of new products, track competitors’ actions and identify promising opportunities e.t.c. Suppliers can turn into partners, helping you cut costs, improve product designs and even fund new marketing efforts. Hence, selecting good suppliers and vendors should be a major part of your growth plan, and so procurers need to roll out efficient and transparent selection processes in order to attract participation from the best suppliers in the market who are most likely going to provide the best value for money spent.

It is therefore essential that suppliers understand the changes and requirements needed before moving forward with any new procurement process or technology. Allowing your supply community to adapt to and embrace the potential benefits for themselves is a sure way to a smooth implementation.

Some of the best practices to be adopted on proactive supplier adoption include:

  • Finding suppliers that are open to technology
  • Effective and open two way communication
  • Ensure that your suppliers are familiar with new processes and tools

The need for effective Communication with Bidders/suppliers cannot be overemphasised. This is will amongst many others help to curb or completely avoid supplier resistance.

Every   e-auction event should;

  1. Clearly communicate the rules of engagement at the start to all concerned and ensure to stick to those rules
  2. If changes are required, communicate openly to all participants
  3. Only allow credible suppliers to participate.
  4. Do not allow separate deals outside of the established process
  5. Inform all participants within the agreed timeframe of the outcome
  6. Unbundling of lots is not allowed unless this is clearly specified upfront
  7. Ensure simultaneous availability of information to all participants
  8. During the Bidding/evaluation process to follow the parameters of the RFQ.

We have also seen that for those categories where auctions are applicable, the use of online auctions typically bring additional savings. Auctions move the negotiation from a buyer driven competition to a supplier driven competition. In defining if a category is suitable for e-auctions, answers need to be provided to the following questions in order to ensure that bidders/suppliers are being carried along. These questions include:

  • Product/Service: are the requirements easily specified?
  • Value: is the package being considered for auction of sufficient size to attract competition for its delivery?
  • Market competitiveness: supply base, market evolution, and commodity traded category?
  • Position of the buyer in the market: Buyer/Supplier dominance in the relevant market?
  • Ease of Implementation: existing contracts still ongoing, extensive supplier certification required, etc?

Although buyers are often concerned that the auction sets up the wrong dynamic for a supplier relationship, in many respects the supplier finds the approach beneficial too. From the start the process is more clearly defined and expectations of suppliers are easier to manage. Less time is absorbed in the selling process. Suppliers are able to benchmark against their competitors and understand how competitive their bids are; and they genuinely know where they stand relative to other Organisations. Suppliers should share the same level of information on the process that is being followed and this creates a level playing field for all. Below are some of the typical questions that would run through the mind of a Bidder/supplier before choosing to participate in the process;

  • Why use an electronic E Sourcing system?
  • What do I need to access the system?
  • When are you introducing this system?
  • What do I do when a tender is issued?
  • What if I need further assistance.
  • Will I be able to return a hard copy of my submitted tender? e.t.c.

 CONCLUSIONS

Competitive bidding has traditionally been the best option for project sourcing initiatives. More recently, spend management / strategic sourcing systems have offered a reverse bid auction process that has worked well for commodities but not so well for the sourcing of services. CPBID Technologies, creator of Total Bid, has developed a process and method for automating the bid process but also optimizing savings. To date, the Multistage Bidding platform has been used for thousands of projects representing the energy, healthcare, financial, grocery, office, education, and retail industries, saving these clients millions of dollars every year.

Understanding the Basic Procedures Involved in E-auction software

In every e-auction software or electronic auction event, bidders and auctioneers conduct business on an electronic marketplace. The process is quite simple. The main requirement is an auction site. Commodities, goods, or services are offered by the auctioneer, and bids are submitted by anyone who is interested in the product. The offer is usually given for a limited period only. Buyers and suppliers utilize this platform to negotiate terms of contract. The interactions available include business to consumer, business to business, and consumer to consumer.

Despite widespread practice and participation from members of the buying public and the community of sellers, there are a few recognized limitations of e-actions. There are issues related to security and the possibility of fraud. Moreover, the process has a long cycle time. Concerns about auction software and equipment for buyers also arise periodically

What are the basic types?

There are two major types of e-auctions, namely forward auction and reverse auction. The more common practice that occurs online nowadays falls under reverse auction. This procedure involved reversal of the typical roles of buyers and sellers. Instead of a single seller offering a product or service to competing buyers who bid the price upward, which is what forward auctions are all about, the prices decrease as sellers compete to obtain something that they covet from a buyer. The sellers try to undercut each other and this is why prices get lower as the process continues, instead of getting higher.

What is a traditional RFQ or request for quotation and how is it relevant to e-auctions?

Purchasers need to accomplish a document known as the RFQ or request for quotation so that they can obtain offers for products or services. The data included in this document are item price, terms of delivery, and other relevant conditions surrounding the specific product. Essentially, the RFQ is a document that must be submitted by an organization to suppliers as a means of eliciting quotations.

Traditional RFQs are still used; however, the procedures associated with these documents are often tedious and labor-intensive. Online RFQs are preferred because they are easier to process and less prone to error. They are also more efficient. A request for quotation is a solicitation document is necessary in both a negotiated purchasing process and in a firm-bid purchasing process. If the requirements are more complex, another document must be used, and this is known as the RFP or request for proposals.

In the dynamic bidding process, activation of the RFQ is the signal for suppliers to submit their bids. While the RFQ is active, the initiator has the prerogative to review the current bids. The alternative option is to wait until all the bids are received. Bid evaluation for simple RFQs may be conducted online. For complicated RFQs, the evaluation is usually done offline. The RFQ process is completed only when the winner of the bid has been determined.

E-auctions are increasing in popularity these days since both businesses and consumers find the process advantageous for them. Other terms used interchangeably with e-auction are e-sourcing, sourcing event, procurement auction, and e-procurement.

Budget for eSourcing Software Solution

Budget management within an organisation can either make or break that company; without strict adherence to budget’s limits, as well as the strategic use of spending within those limits, an organization often loses money through overspending and missed investment opportunities. Inefficient budgeting often arises from a company’s failure to synchronize her budgeting efforts with their purchasing controls and this is due mainly to poor transparency between procurement spending and changing budget levels. Even when organizations use efficient procurement management strategies, these variations can cause major problems, both in back-office cost control and for the bottom line. Procurers therefore need smarter purchasing and this can be achieved through implementing an e-sourcing/contract management software and also by taking advantage of collaborative buying in order to promote an efficient and cost effective procurement system. This ensures increased control and visibility in her procurement processes.

The role of technology in the world of vendor/supplier sourcing, procurement and management is becoming increasingly indispensable. Recent advances in the world of electronic procurement and supplier management technology span many different industries. Any service or product; from paperclips to attorneys may now be sourced, procured and managed electronically.  How much of this client-supplier/vendor relationship has moved to electronic platforms however varies from industry to industry and also depends on the complexity of the services and/or products in question but in most cases, all products and a growing number of services are driven by e-sourcing software solutions. The manufacturing industry, for example, is highly engaged and to a greater extent has driven the development and sophistication of e-sourcing solutions. E-sourcing, simply put, is moving what was once a highly paper driven process onto an electronic platform.

Electronic procurement software is one of the most important tools for automating purchasing and financial processes. It facilitates electronic requisitioning, online vendor catalogs management, purchase order and receipt management, and integration with accounts payable. Its purpose is to mainly reduce the costs and time associated with manual processes, as well as to support more accurate product information and more competitive pricing. Leveraging clients’ buying power is also a prominent driving force in the utilization of procurement technologies these days, these tremendous opportunities lets you say goodbye to the traditional, labour intensive way of posting and advertising contract opportunities and RFQ’s.

Benefits of e-sourcing

Implementing an esourcing and contract management solution can bring a variety of benefits to any organisation, mainly improving procurement efficiency and reducing costs.
Esourcing significantly reduces the supply management costs by automating, simplifying and accelerating source to procure processes for goods and services. Esourcing solutions eventually increase bottom line cost savings by focusing on strengthening supplier relationships and streamlining tender processes.

Likewise, visibility into budget management is especially important for organizations with complex global operations. For example, a large corporation in the professional services industry may have dozens of smaller divisions running numerous client-funded projects, all of which are connected to the same central budget. In order for the company to run efficiently and competitively across different countries—with varying time zones and business requirements—procurement professionals and other business administrators must have complete visibility into where the company’s money is going and how successfully its budgets are being controlled.
Greater savings can also be made by public sector organisations collaborating in the procurement of goods and services. This enables the organisations to drive prices down by providing suppliers with greater quantities enabling them to reduce margins. Fortunately, today’s leading eProcurement budgeting tools are built to give organizations real-time control over how their money is spent, no matter how complex and widespread the spend allocation. Advanced eProcurement software can manage budgets in real time by fully integrating existing financial systems (such as the ERP) with requisitioning, catalogs, and Purchase order management—all in accordance with the organisation’s unique business structure and requirements. This not only allows administrators to drill down into minute budget details at a glance, it also enables them to measure and analyze the current use of their funds and strategically plan for future budget cycles.

Further Considerations

Implementing an esourcing and contract management solution can be relatively straightforward. Many solutions on the market offer a Software as a Service based solution which can be accessed from anywhere in the world with a web browser and internet connection. A hosted solution requires no additional in house IT infrastructure and reduces implementation times. These software solutions are readily available and are cost effective, even for small and medium-sized enterprises.

Managing a paper- based system is expensive, slow, hard to measure or audit, and harmful to the environment. In the e-sourcing world, the removal of paper from the billing process also helps organizations to meet their CSR commitments. Staff will also be quick to embrace tools that save time and expense; benefits offered by any e-sourcing software solution.

Welcome to Low Cost Country Sourcing

Welcome to Low Cost Country Suppliers web site,

We hope that you will take a moment to review this new web site and hope that you will find this new web site exciting and informative.

Low Cost Country Sourcing  is an online Marketplace to create RFQ and RFI for buyers  and to submit a quotation for suppliers to their manufactured parts in different production technologies.

Low Cost Country Suppliers have built up a huge database of information on  Eastern Europe manufacturing markets since 2004. Our aim is to find the right suppliers for buyers and right buyers for suppliers in Eastern Europe.

We are pleased to inform you that this is the beta version of our web site.Upcoming months we will do our best to finish testing of  www.lccsuppliers.com.

There is also another web site which is for e-auction, www.bideg.com.

E-Auction have been used for commercial transactions for years and there are many different types of  e-auction methods. Generally, auctions can be classified on the basis of competition, between sellers or buyers.

Enjoy it!