eBridge News (Commodities)
A water district partnered with eBridge to purchase three different chemicals for their water treatment plant via reverse auction. Originally, the bid was for a two year contract. However, the water district and eBridge collaborated and determine the best strategic approach would be to bid the project for just one year because chemical pricing was trending higher than average.
The three chemicals were bid per pound. Eight suppliers placed a total of 188 bids on the three line items during the bid. First place changed hands 35 times.
At the conclusion of the event, the buyer saved 10% versus their previous contract, with one chemical’s pricing coming in higher than expected. Due to the volatile nature of chemical prices, reverse auctions are ideal for this type of commodity, giving the buyer confidence they are buying at market.
A medium-sized city recently partnered with eBridge to purchase water and waste water treatment chemicals. The chemicals included: chlorine gas, liquid caustic soda, liquid alum, hydrofluosilicic acid, aqua ammonia, activated carbon, polyaluminum chloride, potassium permanganate, chlorine gas, sulfur dioxide, HTH granular and HT 3″ chemicals.
The 13 suppliers placed a total of 319 bids on the 12 chemicals. First place changed hands a total of 50 times throughout the one hour, 18 minute bid. At the conclusion of the event the lowest spread between 1st and 2nd was 0.01%, indicating true market value had been found. The overall budget was $172,000 with the final low bids totaling $169,022.
A Kentucky utility recently partnered with eBridge to purchase water treatment chemicals. Thirteen suppliers participated in the bid for a variety of chemicals.
Throughout the course of the reverse auction bidding event, 640 bids were placed and first place changed hands 105 times, showing the suppliers were actively competing for the business.
The estimated savings on the thirteen chemicals at the conclusion of the event was 11% versus least year’s budget.
A Midwestern city partnered with eBridge to purchase water treatment chemicals a total of 12 suppliers participated in the event, placing a total of 231 consecutive bids.
In a reverse auction, suppliers have the opportunity to place subsequent lowering bids for a product or service. In this case, several different water treatment chemicals. First place changed hands 29 times, with the clock extending 94 times.
Because the price of chemicals is volatile, it’s important to note that first and second place suppliers were less than .2% apart, indicating true market value had been achieved for the purchase.
The city was very pleased with the bid and will run several more items through the process in the future.
A Midwestern city partnered with eBridge to purchase water treatment chemicals a total of 12 suppliers participated in the event, placing a total of 231 consecutive bids.
In a reverse aucution, suppliers have the opportunity to place subsequent lowering bids for a product or service. In this case, several different water treatment chemicals. First place changed hands 29 times, with the clock extending 94 times.
Because the price of chemicals is volatile, it’s important to note that first and second place suppliers were less than .2% apart, indicating true market value had been achieved for the purchase.
The city was very pleased with the bid and will run several more items through the process in the future.
The Associated Press
October 17, 2010
DANVILLE, Ky. — A central Kentucky city has turned to online auctions to buy supplies such as road salt, water treatment chemicals and a new city fire truck.
Danville city commissioners and an official with the company running the sales say the method appears to be saving the city money.
Jock Kinnett, a representative of Louisville-based eBridge, told the Danville Advocate-Messenger that the city saved 16 percent on chemical purchases over the previous year.
The company organizes auctions for public procurement in a timed setting, much the same way an eBay auction is operated.
Kinnett said the company collects a percentage of the sale from the seller after the city has paid the vendor.
Read more: http://www.kentucky.com/2010/10/17/1483627/ky-city-turns-to-online-auctions.html#ixzz12iQDrDYo
A Kentucky city partnered with eBridge to purchase their road salt in preparation for the winter months. eBridge ran this same bid last year and the city knew the reverse auction process was necessary for their city to purchase the salt at a competitive price point.
eBridge’s team of purchasing professionals sourced suppliers for this bid, with four being chosen by the city to participate.
During the bidding event, a total of 160 bids were placed among the four suppliers, resulting in 80 first place turnovers and 59 extension of the clock, indicating the suppliers were ready to compete for this business.
At the conclusion of the bid, the city had realized a 10% savings versus last year’s pricing, indicating that while they purchased competitively last year through the reverse auction, they achieved true market value for their purchase for both this year and last.
In 2009, The City of Fort Smith Arkansas partnered with eBridge on the purchase of their water treatment chemicals, achieving significant savings and efficiencies in their purchasing process. Because of the success, Fort Smith immediately turned to eBridge to again provide expertise and leadership through this year’s chemical purchase. (Click here to read about last year’s event!)
For the 2010 bid, our team of purchasing professionals assisted the city in sourcing 17 suppliers to participate in the event. During the bidding event, 293 bids were placed by the 17 suppliers. In a paper bid process, the City of Fort Smith would have only received 14 bids rather than the 293 subsequent lowering bids that were placed by the 17 suppliers.
Throughout the bid process, eBridge provided consistent communication to the Fort Smith purchasing department about the status of the suppliers, bid documents and confirmation of communication to participating suppliers. The final deliverable was the reverse auction event that proved to be a huge success, yet again.
A mid-western city partnered with eBridge yet again to establish a road salt bid with one year extensions for the next four years. eBridge established the city’s road salt contract 5 years prior and with the contract up for renewal, the city looked to our team of purchasing professionals to deliver for them, yet again.
As purchasing professionals know, establishing road salt contracts early in the year helps your organization get a competitive market price for your purchasing jurisdiction.
The city anticipated a specific price per ton, however, at the conclusion of the reverse auction event, the auction yielded a low bid 15.38% lower.
Saves 5% off budget price on six new vehicles in preparation for 2010 school year
A school district needed to purchase a variety of vehicles prior to the start of the 2010-2011 school year. With tighter operating budgets, the school was looking for ways to save on cost, but not cut safety or necessity when providing a quality education and supporting programs to its students.
The school district sought to purchase six different vehicles, including maintenance trucks and driver’s education vehicles. They enlisted the expertise of eBridge, to provide purchasing consulting and the reverse auction platform.
Six car dealerships participated in the event, placing a total of 38 bids on the six vehicles included on the reverse auction. The clock extended 32 times indicating that the dealerships were excited to win the business for the new vehicles and that the school district was closer to achieving true market value for the purchase.
At the conclusion of the event, the price was five percent lower than their budgeted value and the school district was able to purchase all six vehicles and still meet budget.
As our economic future remains uncertain, it is important to maintain quality education for our young citizens. By incorporating purchasing efficiencies in to our routine purchases in education facilities, like the reverse auction, maintaining quality education becomes a reality.