On-line Reverse Auction Strategies Study In Manufacturing Companies

To win business in dog-eat-dog market, controlling cost at a reasonable level isessential. Supplier chain management becomes more and more important in manufacturingcompanies. Global sourcing is more and more popular; it changed the purchasing situationand brought new opportunities. On-line reverse auction is a good tool on getting reasonableprice. On-line reverse auction is becoming a new tool on cost control with the popularity ofinternet. How to approach it in manufacturing companies is a valuable topic.With rich experience in leading companies and relevant theoretical knowledge inMBA study, the paper analyzed how to set the strategies of on-line reverse auction inmanufacture companies. The main contents:(1) Characteristics of on-line reverse auction, analyzing the differences with traditionalpurchasing tools，traditional bidding, and studying its shortage and strength.(2) Process flow of on-line reverse auction, building models for each key step e.g.: how tochoose parts for e-bidding, how to set relevant parameters, and how to make awards.Introducing the process with cases in actual work.(3) Studying on how to make sourcing team work well, especially on how to developsourcing people and manage the sourcing team under the new purchasing situations.(4) Providing new proposal on strategies of on-line reverse auction. The new proposal willbe helpful on how to maintain good relationship with suppliers, and how to decreasethe risk on using the tool.The study gives solutions on solving problems in actual work and provides referencesfor the companies which will use or just begun to use the tool. At the same time,participants can get basic knowledge of on-line reverse auction. The paper also mentionednew problems and outlook of on-line reverse auction.