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  • Auctions

Improve sourcing outcomes with online auctions

Plan, execute, and evaluate sourcing auctions with full control — from supplier preparation to award decision.
✓ Create competitive pressure with the right setup
✓ Shorten negotiation cycles
✓ Achieve measurable sourcing outcomes

Trusted by leading manufacturing companies to manage complex, global supply chains and supplier collaboration processes.

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How it works

How sourcing auctions work in practice

Sourcing auctions deliver the best results when they are embedded in a structured sourcing process rather than treated as isolated pricing events. Market conditions, supplier readiness, and auction design need to be aligned before execution begins.

  1. Assess auction fit
    Evaluate supplier comparability, market dynamics, and volume structures to determine whether an auction is the right approach for the specific sourcing scenario.
  2. Define the auction setup
    Define clear rules, bidding logic, and the awarding approach.
  3. Prepare suppliers
    Prepare and align suppliers before the live event.
  4. Run the live auction
    Create dynamic competition in real time while maintaining transparency and control.
  5. Evaluate the results
    Execute the award automatically according to predefined criteria or manually and use the results for further negotiations and sourcing outcomes.
The Challenge

Auctions underperform when critical elements are not aligned

Sourcing auctions often fall short because critical elements of the process are not properly aligned. Instead of creating competitive pressure and clear outcomes, they can introduce complexity, reduce comparability, and limit their impact on sourcing decisions.

Market conditions do not support effective competition

Using auctions without validating supplier comparability, market dynamics, or volume relevance can result in weak competition.

The sourcing objective is unclear

Missing target prices, unclear bidding logic, and poorly defined rules prevent meaningful negotiation outcomes.

Suppliers are not prepared for the live auction

Lack of communication, training, or alignment reduces participation quality and increases execution risk.

Auction results remain isolated

Without a clear path after the event, results cannot be effectively translated into award decisions or savings.

The SupplyOn approach

Manage sourcing auctions as a structured and controlled negotiation process

SupplyOn Auctions enables manufacturers to run sourcing auctions as a structured, integrated, and controlled negotiation process rather than as isolated pricing events.

Buyers can convert RFQs into auctions, define the right strategy, set up auction rules, prepare suppliers, and execute events with the appropriate level of transparency. Results can then be used for award decisions, further negotiations, and measurable savings.

Assess auction fit and define the strategy

The first question is whether an auction is the right instrument for the sourcing scenario. Buyers can assess the market situation and supplier structures before defining the target outcome, award logic, negotiation path, and auction parameters.

This is especially important when qualification requirements, incumbent advantages, or distribution logic make a simple price event risky.

Business impact
  • Align auction design with sourcing objectives
  • Reduce the risk of failed or ineffective auction events
  • Increase negotiation leverage through structured preparation
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Choose the right auction type for the sourcing scenario

SupplyOn supports multiple auction types so buyers can choose the right competitive logic for the sourcing case. Auction formats can be selected based on the required transparency, buyer control, and competitive dynamics.

Bidding logic and supplier visibility can be configured according to the sourcing scenario.

Business impact
  • Improve the fit between auction format and supplier situation
  • Optimize competitive tension without losing control
  • Support bidding behavior aligned with negotiation goals

Prepare suppliers and manage execution

SupplyOn supports the operational process from supplier communication and training through test auctions, live auction scheduling, login monitoring, hotline support, and escalation handling.

After the event, buyers can evaluate prices, compare suppliers, and decide whether to award directly, continue with the best bidders, implement supplier changes, or realize negotiated savings through the downstream sourcing process.

Business impact
  • Lower execution risk on live auction day
  • Improve supplier participation quality and readiness
  • Enable a faster and more reliable transition from auction to sourcing decisions
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Business outcomes

Drive savings through structured competition and faster negotiations

The strongest value drivers for sourcing auctions come from shorter negotiation cycles, higher competitive pressure, lower sourcing-management effort, and stronger realization of price improvements when the auction is used in the right market situation and with the right setup.

Up to 65% faster negotiation cycles

Structured preparation, real-time bidding, and clear decision paths accelerate sourcing processes.

8–12% material cost reduction

Increased competitive pressure and optimized auction formats drive measurable price improvements.

Reduced sourcing effort and complexity

Standardized auction setup, execution, and evaluation streamline sourcing operations.

Stronger realization of savings

Auction results are directly translated into award decisions and implemented outcomes.

Better auction decisions. Stronger competition. Measurable sourcing outcomes.

Frequently asked questions

Questions about SupplyOn Auctions

SupplyOn Auctions helps buyers run structured online negotiations when the market situation supports competitive bidding. It is designed to create price transparency, increase negotiation pressure, shorten cycle times, and improve sourcing outcomes through the right combination of setup, supplier preparation, and execution logic.

An auction is most effective when suppliers are comparable, the sourcing volume is representative, the market is competitive enough to create tension, and the target outcome is clear. It is especially useful when the buyer wants to award to the winner, continue negotiation with the best bidders, or accelerate a competitive pricing phase.

An auction is a poor fit when the supply market is too narrow, supplier qualification is highly asymmetric, commercial comparability is weak, or the sourcing outcome depends more on technical uniqueness than on competitive pricing. In these cases, the wrong auction setup can damage negotiation quality rather than improve it.

SupplyOn supports English reverse auctions, dynamic reverse auctions, traffic light auctions, Dutch forward auctions, Japanese reverse auctions, and first-price sealed bid auctions. Each serves a different negotiation purpose and level of supplier visibility.

In an English reverse auction, suppliers see the anonymous best price and can improve their bid against that benchmark. In a dynamic reverse auction, suppliers mainly underbid themselves while their ranking evolves. This gives the buyer broader insight into the pricing potential of participating bidders.

A traffic light auction is useful in more complex negotiations where the buyer wants to create competitive pressure without exposing full price transparency. Suppliers receive color-based status feedback, helping guide bidding without revealing the full competitive position.

SupplyOn supports supplier communication and training, test auctions, live auction scheduling, login monitoring, hotline support, and escalation handling. These activities help prepare suppliers before the event and support controlled execution during the live auction.

After the event, buyers can evaluate prices and compare suppliers. Depending on the sourcing strategy, they can award directly, continue negotiations with the best bidders, implement supplier changes, or realize negotiated savings through the downstream sourcing process.

Auctions

Run sourcing auctions as a structured negotiation process

Connect auction strategy, parameter design, supplier enablement, live execution, and award follow-up in one structured process.

Negotiate faster, create stronger competition, and realize savings with greater control.

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