Reverse auction - Revision history

Editor at 15:54, 23 September 2021

2021-09-23T15:54:17Z

← Older revision		Revision as of 15:54, 23 September 2021
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	* Computers in construction tendering.		* Computers in construction tendering.
	* Dutch auction.		* Dutch auction.
		+	* Electronic auctions under the Single Procurement Document (Scotland).
	* E-procurement.		* E-procurement.
	* E-sourcing.		* E-sourcing.

Editor at 21:16, 12 November 2020

2020-11-12T21:16:46Z

← Older revision		Revision as of 21:16, 12 November 2020
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	* Dutch auction.		* Dutch auction.
	* E-procurement.		* E-procurement.
		+	* E-sourcing.
	* Invitation to tender.		* Invitation to tender.
	* Managing the procurement process.		* Managing the procurement process.
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	* The benefits of e-procurement in construction.		* The benefits of e-procurement in construction.

−	[[Category:Procurement]]	+	[[Category:DCN_Definition]] [[Category:DCN_Guidance]] [[Category:Procurement]]

Designing Buildings at 15:16, 23 April 2020

2020-04-23T15:16:56Z

Editor at 17:07, 22 April 2020

2020-04-22T17:07:44Z

← Older revision		Revision as of 17:07, 22 April 2020
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	* Bidder.		* Bidder.
	* Computers in construction tendering.		* Computers in construction tendering.
		+	* Dutch auction.
	* E-procurement.		* E-procurement.
	* Invitation to tender.		* Invitation to tender.

Editor at 14:31, 22 April 2020

2020-04-22T14:31:05Z

← Older revision		Revision as of 14:31, 22 April 2020
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	This form of service procurement originated in the US the 1990s as businesses began to incorporate Internet-based methods as a way to increase the speed of their procurement processes. The approach was initially used to purchase items (such as office supplies and manufacturing equipment) and services (such as tech support). It was not until 2000 that reverse auctions for construction services were adopted in the US by large retailers, pharmaceutical companies and automobile manufacturers.		This form of service procurement originated in the US the 1990s as businesses began to incorporate Internet-based methods as a way to increase the speed of their procurement processes. The approach was initially used to purchase items (such as office supplies and manufacturing equipment) and services (such as tech support). It was not until 2000 that reverse auctions for construction services were adopted in the US by large retailers, pharmaceutical companies and automobile manufacturers.

−	Reverse auctions were introduced in the UK in the early 2000s when the Office of Government Commerce (OGC) tested it as a procurement method for negotiating various products and services not specifically associated with construction. It became more popular within the government and is still used now although it is not so commonly used in other sectors.	+	Reverse auctions were introduced in the UK in the early 2000s when the Office of Government Commerce (OGC) tested it as a procurement method for negotiating various products and services not specifically associated with construction. It became more popular within the government and is still used now (although it is not so commonly used in other sectors).

	= Details of reverse auctions =		= Details of reverse auctions =

Editor at 14:28, 22 April 2020

2020-04-22T14:28:54Z

← Older revision		Revision as of 14:28, 22 April 2020
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−	[[File:~~Reverse Auction~~.800.jpg\|~~800px~~]]	+	[[File:Reverse_Auction.800.jpg\|link=File:Reverse_Auction.800.jpg]]

	= Introduction =		= Introduction =
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	* Open tendering.		* Open tendering.
	* Procurement route.		* Procurement route.
−	* Supply chain management.
−	* Supply chains in construction.
	* The benefits of e-procurement in construction.		* The benefits of e-procurement in construction.
−	* Tender process.

	[[Category:Procurement]]		[[Category:Procurement]]

Editor: Created page with "800px = Introduction = Reverse auctions occur when construction contractors compete for business in an online event by submitting the lowest bi..."

2020-04-22T12:58:54Z

Created page with "800px = Introduction = Reverse auctions occur when construction contractors compete for business in an online event by submitting the lowest bi..."

New page

[[File:Reverse Auction.800.jpg|800px]]

= Introduction =

Reverse auctions occur when construction contractors compete for business in an online event by submitting the lowest bid during a specific timeframe. Reverse auctions can either be open or closed/private and are forms of Dutch auctions (also known as open descending-bid auctions where an initial price is set and progressively lowered until the bidder is prepared to accept the fee that has been agreed upon for the project).

The purpose of a reverse auction is to allow business owners or procurement managers to purchase construction services at the lowest price. It does not take into consideration additional experience or qualifications of the contractor.

= History =

This form of service procurement originated in the US the 1990s as businesses began to incorporate Internet-based methods as a way to increase the speed of their procurement processes. The approach was initially used to purchase items (such as office supplies and manufacturing equipment) and services (such as tech support). It was not until 2000 that reverse auctions for construction services were adopted in the US by large retailers, pharmaceutical companies and automobile manufacturers.

Reverse auctions were introduced in the UK in the early 2000s when the Office of Government Commerce (OGC) tested it as a procurement method for negotiating various products and services not specifically associated with construction. It became more popular within the government and is still used now although it is not so commonly used in other sectors.

= Details of reverse auctions =

For the project owner, the outcome of a reverse auction will depend several factors:

* Is the marketplace competitive?
* Does the bid include all of the specifics of the project?
* Are all drawings complete?
* Have contracting firms been properly pre-screened before being permitted to participate in the auction?
* Is there an understanding of how change orders will be handled once the project begins?

General contractors must evaluate the following criteria before submitting their bids:

* Will the bid allow them to deliver the results as promised without compromising issues such as safety or timeframe?
* Will the delivery of the project have a negative impact on the outcome of other projects - whether it be profit margin or reputation?
* Will the bid cover costs of all subcontractors on the project?
* Is there a limit to how low they will bid before walking away from the project?

By treating construction projects as commodities (such as office supplies or manufacturing equipment), the reverse auction process can fail to incorporate external variables (such as weather, personnel, site conditions and other factors) that are inherent in construction projects. This method has never popular within the construction industry despite being used as an acceptable method of procurement.

= Related articles on Designing Buildings Wiki =

* Auction theory.
* Best value.
* Bidder.
* Computers in construction tendering.
* E-procurement.
* Invitation to tender.
* Managing the procurement process.
* Open tendering.
* Procurement route.
* Supply chain management.
* Supply chains in construction.
* The benefits of e-procurement in construction.
* Tender process.

[[Category:Procurement]]

← Older revision		Revision as of 15:16, 23 April 2020
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	= Introduction =		= Introduction =

−	Reverse auctions occur when ~~construction contractors~~ compete for business in an online event by submitting the lowest bid during a specific timeframe. Reverse auctions can either be open or closed/private and are forms of Dutch auctions (also known as open descending-bid auctions where an initial price is set and progressively lowered until ~~the~~ bidder is prepared to accept the ~~fee that has been agreed upon for the project~~).	+	Reverse auctions occur when suppliers compete for business in an online event by submitting the lowest bid during a specific timeframe. Reverse auctions can either be open or closed/private and are forms of Dutch auctions (also known as open descending-bid auctions where an initial price is set and progressively lowered until a bidder is prepared to accept the amount offered).

−	The purpose of a reverse auction is to allow business owners or procurement managers to purchase construction services at the lowest price. It does not take into consideration ~~additional~~ experience or qualifications of the ~~contractor~~.	+	The purpose of a reverse auction is to allow business owners or procurement managers to purchase construction services at the lowest price. It does not take into consideration the experience or qualifications of the bidder.

	= History =		= History =

−	This form of service procurement originated in the US the 1990s as businesses began to incorporate Internet-based methods ~~as a way~~ to increase the speed of their procurement processes. The approach was initially used to purchase items (such as office supplies and manufacturing equipment) and services (such as tech support). It was not until 2000 that reverse auctions ~~for~~ construction services ~~were adopted~~ in the US by large retailers, pharmaceutical companies and automobile manufacturers.	+	This form of service procurement originated in the US the 1990s as businesses began to incorporate Internet-based methods to increase the speed of their procurement processes. The approach was initially used to purchase items such as office supplies and manufacturing equipment, and services such as tech support. It was not until 2000 that reverse auctions were used construction services in the US by large retailers, pharmaceutical companies and automobile manufacturers.

−	Reverse auctions were introduced in the UK in the early 2000s when the Office of Government Commerce (OGC) tested it as a procurement method for negotiating ~~various~~ products and services not specifically associated with construction. It became more popular within the government and is still used ~~now (although it is not so commonly used in other sectors)~~.	+	Reverse auctions were introduced in the UK in the early 2000s when the Office of Government Commerce (OGC) tested it as a procurement method for negotiating contracts for products and services not specifically associated with construction. It became more popular within the government and is still used today.

	= Details of reverse auctions =		= Details of reverse auctions =
Line 19:		Line 19:
	* Is the marketplace competitive?		* Is the marketplace competitive?
	* Does the bid include all of the specifics of the project?		* Does the bid include all of the specifics of the project?
−	* Are all drawings complete?
	* Have contracting firms been properly pre-screened before being permitted to participate in the auction?		* Have contracting firms been properly pre-screened before being permitted to participate in the auction?
	* Is there an understanding of how change orders will be handled once the project begins?		* Is there an understanding of how change orders will be handled once the project begins?

−	~~General contractors~~ must ~~evaluate~~ the following criteria before submitting their bids:	+	Suppliers must consider the following criteria before submitting their bids:

	* Will the bid allow them to deliver the results as promised without compromising issues such as safety or timeframe?		* Will the bid allow them to deliver the results as promised without compromising issues such as safety or timeframe?
	* Will the delivery of the project have a negative impact on the outcome of other projects - whether it be profit margin or reputation?		* Will the delivery of the project have a negative impact on the outcome of other projects - whether it be profit margin or reputation?
−	* Will the bid cover costs of all subcontractors on the project?	+	* Will the bid cover the costs of all subcontractors on the project?
	* Is there a limit to how low they will bid before walking away from the project?		* Is there a limit to how low they will bid before walking away from the project?

−	By treating construction projects as commodities (such as office supplies or manufacturing equipment), the reverse auction process can fail to ~~incorporate~~ external variables (such as weather, personnel, site conditions and other ~~factors) that are inherent in construction projects~~. This method has ~~never~~ popular within the construction industry ~~despite being used as an acceptable method of procurement~~.	+	By treating construction projects as commodities (such as office supplies or manufacturing equipment), the reverse auction process can fail to properly consider external variables such as weather, personnel, site conditions and other so on. This method has generally not been popular within the construction industry.

	= Related articles on Designing Buildings Wiki =		= Related articles on Designing Buildings Wiki =