Help Home/ Creating Negotiations
When creating a negotiation, you can use a number of techniques to facilitate the results you want:
Using item attribute requirements You can add item attributes to any of your items. Item attributes define 1) unique specifications that you set for an item, and 2) the details that a participant should provide when responding to that item.
If you want to ensure that specific details accompany every response to an auction item, add those details as item attributes, and mark the item attributes as required. All participants will be required to submit the requested attribute information with their responses.
Using AutoExtend and Bid Decrementprocessing (auctions only)
AutoExtend If you set AutoExtend to "yes," your auction is automatically extended if a new best bid is received during the AutoExtend window. The most competitive bids are often received in the closing minutes of an auction. By enabling AutoExtend, you allow all bidders the extra time to match and surpass the most competitive bids. Enabling several AutoExtensions can spark several rounds of competitive participation.
Bid Decrement If you enable bid decrement, you specify that bids must improve by the minimum amount you choose. Bid decrement enables you to eliminate fractional improvements in bid prices. Bid decrement accelerates improvements in bid prices and can help you quickly reach - and surpass - your target price. Bid improvement controls only apply to the current round of bidding. They are not carried over from one round of bidding to and subsequent round.
Setting a Quote/Bid Start Price and a Target Price You can set a Quote/Bid start price and/or a target price for each item.
Quote/Bid Start Price Starting price for one unit of your negotiation item. By setting a start price, you communicate to participants the threshold beyond which you will not award the auction item. Setting a start price enables you to ensure that no bids above the start price will be accepted.
Target Price Price you hope to pay for one unit of your negotiation item. By displaying a target price, you set an "ideal" threshold toward which the most competitive responders can strive. You can also quickly spark a round of competitive participation around your target price, potentially leading to a best response that improves upon your target price.
Controlling the visibility of competing quotes/bids You can create an open, blind, or sealed negotiation:
Open(auctions only) All buyers can see the responses in the negotiation, though the supplier identity is concealed.
Blind Only the buyer can see the negotiation responses.
Sealed Neither the buyer nor the suppliers can see the responses until they are unlocked and unsealed by the buyer.
In an open negotiation suppliers see the current best price for the negotiation, and immediately know whether they can respond competitively. An open negotiation enables you to eliminate responses that do not improve on the current best prices, and increases the likelihood that you will receive competitive responses that drive prices in your favor.
Alternatively, if you have an urgent supply need, you might consider creating a blind or sealed auction so that bidders cannot see other bidders' bid prices . In some cases, "blind" bidding may lead to better bid prices, because bidders are required to anticipate what other bidders will bid, and will therefore submit their best possible bid price more quickly.
Allowing or disallowing partial quotes/bids You can specify that suppliers must respond to all items in the negotiation.
If you require suppliers to respond to all negotiation items, suppliers may improve response prices on certain items (to remain competitive in the negotiation) while making their margins on other items. When you award the negotiation, you can award business by line item, which allows you to "pick and choose" among the best responses from several suppliers for each item. You can award the negotiation to multiple suppliers, each of whom has submitted the best price for a particular item or items.
Allowing multiple rounds of Quoting/Bidding After your RFQ or auction has closed, you can initiate a new round of bidding on the same auction if you set the response controls to allow multiple rounds of responses (RFQs always permit multiple rounds or quoting). You might decide to initiate a new round of quoting or bidding if you were unsatisfied with the responses from the first round or if you want to add to or change certain details of the RFQ or auction.
Using cost factors Cost factors identify additional item costs beyond just price. Such costs could include service related costs such as training or consulting services.
Using price breaks You can define price breaks on which you can then negotiate with your suppliers to develop a pricing structure based on item quantity, delivery location, or promise date