e-Auction

An e-Auction (electronic auction) in procurement is an online, real-time bidding process where suppliers compete to win a contract by offering their best prices or terms. It is typically used during the sourcing phase to drive competitive pricing and improve transparency.

In an e-Auction, the buyer sets up a digital event where pre-qualified suppliers place bids, often in a reverse auction format—meaning the price goes down as suppliers underbid each other. The auction can follow different formats, such as reverse, Dutch, English, or Japanese, depending on the strategy and the nature of the goods or services.

Key Benefits of e-Auctions in Procurement:

• Cost savings through competitive bidding
• Increased transparency and fairness
• Time efficiency compared to traditional negotiations
• Standardized evaluation of supplier offers

e-Auctions are commonly used for commodities, standardized services, or high-volume purchases where multiple suppliers are available. Tools like SAP Ariba, GEP SMART, and JAGGAER are popular platforms for conducting e-Auctions.