An Introduction toAn Introduction to“Purchasing Auctions”“Purchasing Auctions”

Optimize Costs at your Bidding!Optimize Costs at your Bidding!

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Introducing Introducing “Purchasing Auctions”“Purchasing Auctions”

Part of the remit of a purchasing consultancy is to run reverse auctions on behalf of their customers. Unfortunately, our experience of online auction market providers is that they are expensive to use and their products are invariably all-encompassing, complex and intrusive.

We have recently created a reverse auction site that is: www.purchasingauctions.co.uk A stand alone product Delivered at a competitive price Attractive to both purchasers and suppliers in its ease of use Reliant on competitive bidding at live on-line auctions to reduce prices Designed, run and owned by procurement professionals with

real knowledge and understanding Offered with training and support throughout the Auction to

ensure a smooth and effective process

Founded in 1995

“architects of value”

Introducing Horizon –Introducing Horizon –AssociatesAssociates• Horizon is a purchasing consultancy that focuses on helping firms

become more profitable through better purchasing. • Horizon Associates have been trading for over 10 years and work with

firms such as BT, AXA, HBOS, Nomura, Threadneedle and UBS.• All of our consultants have professional qualifications and extensive

experience and knowledge of the financial services sector.• For example, the Director is a past Presidency of the CIPS, MD at

Bankers Trust and Head of Procurement at the London Stock Exchange.

• We have developed a unique methodology to achieve significant savings which at the same time improves the quality of the bought goods and services.

• In practice we target contractual savings of up to 20 times our fee’s. • During these difficult times we are also happy to charge on a

percentage of the savings achieved.

Horizon –AssociatesHorizon –AssociatesHorizon Associate offer:

• Procurement Training –to quickly improve the performance of purchasers.

• Purchasing Recruitment – including free job board postings on www.purchasingjobboard.com

• Spend Categorization – detailed analysis of your last 12 months expense base and the production of a number of reports.

• Cost Recovery – looking back at your invoices from the last 5 years to identify any overpayments, duplicates or invoices that do not match contractual agreements.

• Automated Bid Evaluation Matrix – Our tender evaluation tool helps procurement professionals develop an evaluation plan and then records the process

• Low cost e-Auctions – from £3000 per auction at www.purchasingauctions.co.uk#

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All – encompassingIntrusiveComplex High Resources required for entry

£Expensive!

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The Reverse Auction & The Reverse Auction & Procurement LifecycleProcurement Lifecycle

Only a small part of the cycle, but done properly realises

significant savings with very littlehassle!

Product Suitability for Product Suitability for Reverse AuctionsReverse Auctions

Increasing Cost £

Increasing Risk

Low High

High

TacticalTactical ProfitProfit

TacticalTactical AcquisitionAcquisition

StrategicStrategic CriticalCritical

StrategicStrategic OpportunityOpportunity

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Contingency Plans RequiredGate GourmetBA £45M Loss!

Price – Major Issue – Service & Supply

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Suitable products have the following characteristics: Strict and unambiguous specifications that ensure a level playing

field

A competitive market

Price as a primary selection criterion (provided spec is met)

Low strategic relevance or impact (green on the previous chart)

Products or commodities which have proven suitable include: Products or commodities which have proven suitable include:

Product Suitability for Product Suitability for Reverse AuctionsReverse Auctions

Paper Products Medical Supplies

Chemical Products Tools

Food Construction

Navigation Equipment Steel

Office Supplies Bespoke Manufacture

PPE Oils and Lubricants

Transport Telecommunications

Pallets Administration Fees

Why Reverse Auctions?Why Reverse Auctions?They drive improvements to the preparation and planning for the tendering process. Also, with a tight spec supplier selection is simplified.

Opportunity for suppliers to submit revised bids for a contract (as opposed to the formal tendering process). Saves substantial negotiation time and money!

The site expects and encourages competitors to focus on each other’s pricing, providing increased market knowledge for buyers and suppliers and promoting competition. This provides a level playing field for suppliers and fuels business improvement.

The Audit Trail produces invaluable benchmarking information and all the necessary detail for contract negotiation – keeps suppliers honest!

The Auction process from start to finish is fully supported by a small, dedicated team that designed and built the site. Training and support is available to both suppliers & purchasers.

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Purchasing Auctions - Benefits Purchasing Auctions - Benefits

“I found the Purchasing Auctions tool extremely easy to use and appreciated the guidance offered. We will definitely be using this valuable service again, especially as we saved 33% on our spend at our first auction! It is great to find a medium created by purchasers for purchasers. Thank you Purchasing Auctions!”

Pauline Sumner, Peel PortsPauline Sumner, Peel Ports

The auction event is transparent, quickly concluded and delivers a complete audit trail within a secure and neutral environment. The emotion and negotiating hassle is taken out of the equation and invariably the price is the most competitive available.

Account managers who have successfully used the auction site have said:Account managers who have successfully used the auction site have said:

“We were very impressed with the auction site. It is one of the best we have used. Easy to use, clear information and quick”

Karen Hardy, PolestarKaren Hardy, Polestar

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Preparation for AuctionsPreparation for AuctionsPreparation is so essential for Success:

Preparing detailed product or service specification. Preparing detailed product or service specification.

The fewer parameters allowed to vary: the better. This will help suppliers in bidding and also make the post-auction evaluation more straightforward.

Recruiting suppliersRecruiting suppliersSome suppliers are not familiar with electronic reverse auctions, so may not be immediately willing to join. in. Suppliers will need validationvalidation in the normal way..

Training purchasers and suppliers Training purchasers and suppliers Purchasing Auctions can provide training assistance on use of the website. A dummy auction can be arranged if required.

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Purchasing Auctions Purchasing Auctions Pricing OptionsPricing Options

• Pay as you goPay as you go

The buyer can purchase individual auctions. Consulting services for complex

tenders may be required to train, set up and manage the first auctions.

From £3,000 per auction

• MultibuyMultibuy

The buying organisation can purchase a number of auctions as a package for a

set price. The package usually includes support and training for both users and

suppliers. From £14,000 per annum for a site licence

• Commission on the realised savingsCommission on the realised savings

Purchasing Auctions earns a % of the indicative savings realised at the

auction.

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Resilient Web Hosting Resilient Web Hosting

El-IDC3 at-a-glanceTwo independent commercial power feedsN+1 redundancy backup powerN+2 redundant cooling system24/7 monitored fire suppression24/7 armed security24” Maxcess raised floors

http://mediatemple.net/company/technology.php

VA-IDC4 at-a-glanceN+2 redundancy backup powerN+2 redundant cooling system24/7 monitored fire suppression24/7 armed security48” raised floors

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You can view an auction at: You can view an auction at:

www.purchasingauctions.co.uk/screencastswww.purchasingauctions.co.uk/screencasts//

This clip can be paused and This clip can be paused and rewound to view the detailrewound to view the detail

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Auction Complete – Purchaser ViewAuction Complete – Purchaser View

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Auction Complete – Purchaser ViewAuction Complete – Purchaser View

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Audit TrailAudit Trail

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Audit Trail DetailAudit Trail Detail

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Why use Purchasing Auctions?Why use Purchasing Auctions?• We are a small, innovative, hands-on reverse auction provider,

bringing considerable experience to the design and functionality of the site. The site has been rigorously tested and proven over 3 years.

• The Auction tool is standalone, possessing a simple, intuitive interface; thus minimising cost of entry and potential for error.

• The site functionality and overall transparency promote sound planning, competitive bidding and hence the most leveraged product prices.

• The Audit Trail data opens a whole new world for negotiation, benchmarking and alternative competitive suppliers in the event of default. Few sites deliver a commitment to price per item.

• You are in control – You select the vendor based on best VFM.

• If you are not pleased with the outcome you needn’t pay us. That is Value for money!

• Why go anywhere else? – www.purchasingauctions.co.uk

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Next StepsNext StepsShould you elect to take your next auction with P Auctions, the cost would be £3000 and would include:

Assistance with preparation for the auction. Training for all parties involved. Running the auction to bid matrix stage. A rider that if you are not pleased with the outcome you are at liberty to ask us not to charge you!

Going forward, we would ask you to :

Complete an NDA.Complete a simple contract. Give us the contact details of a team member through whom we should conduct the rest of the business.

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Thank You!Thank You!

To view an auction please go to: To view an auction please go to:

www.purchasingauctions.co.uk/screencastswww.purchasingauctions.co.uk/screencasts//

For further information or to For further information or to discuss different options for your discuss different options for your

auction please call the team on auction please call the team on 0845 603 81610845 603 8161

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Purchasing Consultancy?Purchasing Consultancy?

Horizon Associates LtdHorizon Associates Ltd145-157 145-157

St John Street St John Street LondonLondon

EC1V 4PYEC1V 4PY

07734 671511 07734 671511

info@horizon-associates.com