Allegheny County Moves Ahead .

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NIGP’s 57 th Annual Forum and Products Exposition. Electronic Reverse Auctions. Presented By: Mr. Thomas E. Youngs Jr., C.P.M. Chief Purchasing Officer County of Allegheny 412-350-4495 August 14, 2002. Allegheny County Moves Ahead.
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NIGP\'s 57 th Annual Forum and Products Exposition Electronic Reverse Auctions Presented By: Mr. Thomas E. Youngs Jr., C.P.M. Head Purchasing Officer County of Allegheny 412-350-4495 August 14, 2002

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Allegheny County Moves Ahead Change as government from a Second Class Pennsylvania County to a Home Rule County New Administrative Code and Purchasing Manual unequivocally take into account electronic switch barters Newly chose County Executive picks, interestingly, to have a buying proficient as opposed to a political deputy

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Buyers utilize a sale arrange stage to acquire costs from various providers Prices go incrementally down as providers constantly put offers against each other on particular things Bidders are unknown to each other Only the purchaser directing the buy can see their personality Detailed computerized offering logs are produced to encourage the classification procedure What is a Reverse Auction?

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Value of a Reverse Auction Accelerated offer assessment prepare Increased reserve funds through heightened rivalry Redirection of provider request to online administration Automated online conveyance of sales, RFQ\'s and changes Complete offer histories, line-thing by detail, in spreadsheet arrange for proficient classification Can be basic and financially savvy to execute

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Hurdles to Overcome Supplier resistance/non-cooperation Supplier innovation refinement Internal purchase in and innovation modernity Accurate authentic estimating/utilization records are critical Market cost developments from past contract years make assessing achievement troublesome Suppliers can undermine to their inevitable weakness

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The Reverse Auction Provider Selecting a supplier includes striking a harmony between cost, customization, experience and client benefit Technology is vital however not really the key differentiator Customer benefit/similarity is enter in early "learning" organize for bidders and purchasers Consider how much function supplier accomplishes for purchaser Consider program adaptability and advancement

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Provider\'s Costs Several installment choices: Straight exchange expenses, forthright charges, programming buys, provider charges, % of investment funds counts, memberships, and so on. Forthright expenses can extend from $0 to $100,000 and can likewise include extra occasion particular charges Transaction charges can go from one to five percent, yet are basic and direct to measure Percentage of reserve funds is more hard to evaluate, requiring strong market insight and precise value history records Subscription expenses more often than not have any significant bearing to do-it-without anyone else\'s help arrange choices

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F.A.Q. Contracts with dubious request amounts introduce a test. A conceivable arrangement is to offer a "gauge" for the offering occasion to offer extension to the venture yet construct the exchange expense in light of a "pay as utilized" framework whereby buys are affirmed through the term of the agreement and the charge is charged intermittently. It is up to the administration supplier to set suitable charges. Shouldn\'t something be said about "prerequisites" sort contracts?

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F.A.Q. Shouldn\'t something be said about private ventures/providers? While all buying experts might want their providers to be dynamic, some little "mother & pop" organizations have yet to end up completely associated with the Information Highway. These organizations can\'t be neglected, be that as it may, as they are regularly imperative and focused providers for the general population purchaser. Ensure that the administration supplier offers an answer for permit these providers to take an interest in the process regardless of the possibility that they don\'t have a dynamic Internet capacity. One arrangement is the "intermediary offer" accommodation, built up with the provider before the occasion.

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F.A.Q. What number of bidders are required? The bigger the field, ordinarily, the more focused the occasion. It is essential to choose those buys which can be coordinated at a more extensive number of providers. Fruitful offering occasions can be held with a few providers, however a field of no less than six to eight is ideal. Buy particulars and market information are critical contemplations when selecting suitable applicants.

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F.A.Q. Are electronic offers/switch barters permitted in your organization? Not all enactment has advanced to suit turn around closeouts. It is essential to survey the idea with your legitimate division and other oversight powers to guarantee your present codes and controls permit you to host such an occasion before using assets on the venture.

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F.A.Q. Shouldn\'t something be said about conventional offer necessities, for instance - paper reports and "live" marks? As said before, customization is essential and there is no motivation behind why programs ca exclude conventional prerequisites if vital. The online turn around sale is a value accommodation step as it were. Every single conventional stride can be incorporated. Obviously, it can likewise be a chance to start developing your framework to exploit the new environment (paperless office and electronic RFQ\'s).

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F.A.Q. How does the administration supplier connect with the providers? The answer is truly subject to the administration supplier, their structure and compensation. At first, eager and constructive provider support is important; on the web, face to face or by phone. This support can be given by either the purchaser or the supplier. Over the coming years be that as it may, online invert closeouts will turn into a standard business device with which most providers will get comfortable and the prerequisite for preparing and training will lessen.

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F.A.Q. What buys are suited to switch unloading? As the procedure is refined and encounter increased, more perplexing buys will be conceivable. Toward the begin, the best buys include moderately basic, ware style things. Contracts requiring little in the method for administration parts or testing, and things that have generally stable markets and a very much created provider base are ideal. Higher dollar volume buys and long contract terms additionally pull in a more aggressive field of providers.

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Key Components Simple, simple to utilize, program based innovation – no product or huge preparing Proxy Bidding: Bidders can set value focuses and permit the framework to offer for them to those levels Dynamic Close: System screens occasion inside snapshots of the nearby and if an offer is set, the occasion is consequently reached out to take into account a reacting offer Variables/Factors: Introduces different factors into the offer esteem assurance to better reflect genuine esteem, for instance - guarantee, incumbency, benefit rates

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Reverse Auction Examples Janitorial Supplies Pool Chemicals Linens Printed Envelopes Rock Salt

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Example Auction A Duration: 1 hours, 22 mins. Bidders: 6 Savings comes about: $13,136.50 - 27% Linens: Sheets and Pillowcases Dynamic Close - Extension Start Bid: $49,026.00 Final Bid: $35,889.50

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Example Auction B Duration: 1 hours, 43 mins. Bidders: 7 Savings comes about: $10,894.30 - 13% Swimming Pool Chemicals Dynamic Close - Extension Start Bid: $83,500.10 Final Bid: $72,605.80

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Provider/Buyer relationship is immeasurably vital Understand that turn around sales are a key apparatus, not an e-trade silver slug Technology and stages are as yet developing Realistic desires: eight to 10% funds normal Look for strong sale instruments and support As usual, sound judgment is key Reverse sell-offs will yield noteworthy investment funds when connected suitably Closing Remarks

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NIGP\'s 57 th Annual Forum and Products Exposition Presented By: Mr. Thomas E. Youngs Jr., C.P.M. Head Purchasing Officer County of Allegheny 412-350-4495 August 14, 2002 Thank You

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