A unique situation requires a unique eAuction format.
A European retailer needed to find new sources of supply for multiple menswear items. Their RFI/P efforts had identified seven qualified suppliers. Initial supplier pricing indicated strong competition on some line items and limited competition on others. To maximize savings potential from the event the client wanted to use eAuction.
To take advantage of the competitive landscape, the seven lines were split into two eAuctions:
- The Cherry Picking format was used for four lines with strong competition
- The suppliers had full visibility to bids
- And there were position (rank) indicators
A Japanese Auction was used for the remaining three lines with limited competition. There was no visibility on bids, nor were there any position indicators.
The Cherry Picking Auction lasted for 40 minutes and provided 3,79% in total savings compared to current price. The Japanese Auction lasted for 55 minutes and provided 14,40% in total savings compared to current price.
By thinking out of the box and splitting the eAuction into two different eAuction types, the client maximized the available competition and achieved savings on all products.