Huge amounts of pounds are tendered annually on products or services. Procurement as a profession is becoming an ever more important focus. Companies recognise that in these times, coming from an economic depression with increased global competition, a competent procurement strategy can mean the gap between profitability and receivership.
E-procurement entered the scene in the nineties with all the dotcom boom and e-markets. It invested some time for the real value to come to light after the initial surge and consolidation. One technology which emerged in helping companies realistically and effectively at reducing cost was the opposite auction.
However, on account of procurement professional’s level of understanding of this new technology, the principal approach to delivering advantages of auctions was via consultancy. Companies emerged supplying the potential for outsourcing this activity and their benefits came from their skilled resource, cutting edge methodologies, systems and comprehensive supplier databases.
With all the general comprehension of reverse auctions vastly improved inside the procurement community along with universities teaching about e-procurement in their curriculums, more and more procurement professionals want to run their very own tenders via reverse auctions.
A number of the companies have realised this and so are starting to sell their software stand alone or being an add-on into a larger Enterprise Resource Planning (ERP) system. Quite sure remains to be expensive, cumbersome as well as assistance in best practice and training.
Thus there is a niche interested in a commoditised product. The fundamental concept is not hard as there is a paradigm shift from ‘luxury’ based software, which requires a third party, with a commodity item that any professional buyer can use.
By offering a mix of these features, reverse auctions are delivered to the next stage inside their evolution. Not only are they building about the understanding already available on the market, these tools may be easily opened to the buyer by offering an incredibly low barrier to entry regarding cost, usability and best practice.
Associated with pension transfer services that start out being utilized only by experts, reverse auctions now are being commoditised. One only must talks about complex software including engineering simulation, which is moving from the hands of engineers for the CAD Jockeys, or website design and look engine optimization tools which started off using a variety of specialized agencies but they are now at the disposal of consumers. Accountancy and CRM solutions have moved to the online model like Clearbooks and Zoho checking complex applications to the SME market. This can be the natural advancement of software in our technological age.
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