Growing Your Business
“A Type of e-auction that is conducted
online, in real-time, between a single
buying organization and pre-qualified
suppliers. Suppliers compete in
presenting bids to the buyer…whose
specifications for design, quality,
deliver, and related terms and
conditions have been clearly defined.”
-Institute for Supply Management
RA’s are auctions that enable Sellers to
proactively compete in real time to win
business opportunities
Several factors affecting government operations required it to identify
new, innovative and affordable ways to meet mission needs, including:
 Budget
and staff management challenges
 A push for openness and increased
competition
 Advancements in technology
14 of 15 Cabinet Level Organizations
Agriculture
Health &
Human Services
Commerce
Homeland
Security
Transportation
Defense
Interior
Treasury
(incl. Army, Navy,
Marine Corps)
Education
Energy
Justice
State
Veteran Affairs
Labor
5
Use of reverse auctions quickly proved to improve numerous core
business functions, including:
 Selecting
suppliers without rounds of
manual negotiations
 Disseminating information easily
 Reducing inventory levels/costs due to
quicker cycle times
 Enhancing transparency
 Keeps
with FAR requirement that $3K$150K go to small business
 Use is on the rise and expanding
 Recommends updating the FAR to
include reverse auction
 Preferred tool of buyers in FYQ4
Traditional auctions are designed to help the Seller maximize
profit of a particular good or service through an increasing bid
process
SELLER
BUYERS
SELLER
Looking to sell a
good or service to
the highest bidder
posts a Buy
Increasingly bid against
each other to purchase
the good or services
Sells good or service
at the highest price
Reverse auctions are designed to help the Buyer maximize
competition while the Seller grows their business
BUYER
SELLERS
BUYER
SELLER
Posts a solicitation for
a requested good or
service.
Decreasingly bid
against each other to
provide the good or
service.
Procured a good or
service at a
competitive price.
Grew business by
gaining a customer
and making a sale.
 Optimized
efficiencies
 Competitive prices
 Increased small business utilization
 Documented, auditable results
 Compliance
 Access
to real opportunities
 Customer base growth
 Opportunity to actively compete
 Process standardization across agencies
•
FY13: $1.25 Billion awarded by Federal Governments to U.S. small
businesses, including $368M for Minority-Owned Small Businesses
2013 SMB Award Volume ($M)
$1.25B
22.7%
$518M
77.3%
Small Business
Other
$368M $333M
$265M $259M $218M
Knowing the right type of commodity or simple service good for a reverse auction is
key to a success
Clear
Specifications
Compelling Spend
Competitive Supply
Base
 No
costs
 No risk
 Government is using more and more
 Your competition is using more and more
 Register
at FedBid (www.FedBid.com)
 GSA Schedule holders: LOGIN to GSA
(http://reverseauctions.gsa.gov)
 Talk to local buyers about possible
reverse auction events being held
 Reverse
Auctions
-
Continue to be a best practice for effective procurement
strategies
-
Rapidly becoming a leading procurement process throughout the
public and private sectors
 Small
Businesses
-
Increased pipeline while reducing level of effort
-
Maintain control of bids and improves competitive intelligence
 Government
Small Business Programs
-
Improves goal achievement
-
Support awareness for growth opportunities