Three Tips for Running a Successful Reverse Auction

Three Tips for Running a Successful Reverse AuctionThe spend analysis is complete and you’ve identified a savings opportunity that can be realized through the execution of a successful reverse auction; the right commodity or service with a competitive market has been chosen, executive leadership is on board, and your eProcurement tool is ready to roll – what can go wrong?

Despite a well thought out strategy, there are a few preparation tips that can create a much more seamless experience for both the buyer and the sellers participating in the sourcing event.


Transparency is of the utmost importance when hosting reverse auctions. You’ll find that many suppliers have participated in very few, if any, reverse auctions. By being transparent from the beginning, the suppliers build trust and comfort, leading to confidence when participating.

How to be Transparent with suppliers? Explain the purpose of the reverse auction. Describe your past experiences hosting such events. Give too much information rather than just enough.


Prior to exposing your suppliers to your eProcurement solution, ensure that you test rigorously. In the past, we’ve found that creating ‘dummy’ suppliers and holding internal test auctions have worked extremely well. Try to “break” the system, use all interface functionality that your suppliers have access to, and become an expert on every setting/function.


To cement trust into the supply base, take the time to train them on the eProcurement system and its reverse auction functionality. We have found that individual training sessions with suppliers have resonated extremely well with them.

Run them through a mock auction with previously added ‘dummy’ suppliers. Take them through the prerequisite review, pre-bid submission, live auction, and bid review phases. Utilizing the software should be second nature to participants, with strategy execution on the forefront of their minds.

Having a team dedicated to auction execution can lead to a great reputation in the marketplace, confident suppliers, and a smooth sourcing event.

Does your procurement organization need further expertise on reverse auctions? Contact ProcureAbility today to work with our seasoned professionals.

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