Professional Services- Information Technology Management Office, SC – Trident Technical College Continuing Education Course Print Contract-
Trident Technical College engaged BidBridge for a print contract for the college’s education course materials. The bid consisted of only a single line item for this individual contract.
Seven suppliers competed for the contract. Twenty-seven bids were placed among the seven suppliers yielding 13 first place turnovers.
Through engaging BidBridge, Trident Technical College achieved true market value for the print contract and saved 10% versus its initial budget.
Logs Less than Two Percent Separation between First and Second Place Bids on All Line Items
DANVILLE, KY (December 9th, 2009) – In October, the City of Danville, KY set out to acquire new contracts on eight water and sewer treatment chemicals. City officials recognized the need to use innovative techniques in procurement to attain the pricing they were hoping to achieve. As a result, the city looked into leveraging an electronic reverse auction platform for the bid.
Earl Coffey, Chief Engineer for the City of Danville partnered with Louisville-based BidBridge, a proven e-auction services provider for the public and private sectors. While the public sector’s traditional one price per supplier response has lasted over the years, BidBridge offers an alternative for public organizations that recognize the need for better competition in the bid process. By using a secure, real-time electronic sealed bid platform that allows suppliers to place multiple bids, the purchaser gains visibility and creates a more dynamic and competitive purchasing environment.
With BidBridge’s help, the city was able to attain the following line items with a mere two percent separation or less between first and second place suppliers:
– Hydrofluosilicic Acid
– Potassium Permanganate
– Liquid Alum
– Alum
– Mississippi Rotary Lime
– Powdered Activated Carbon
– Bulk Powder Activated Carbon
– Sodium Aluminate Solution
Fifty-five bids were placed for the bulk powder activated carbon line item, resulting in 29 first place turnovers and 89 time extensions. The event lasted two hours and three minutes.
While all of the elements produced heavy competition, the most competitive element was bulk powder activated carbon. With only .10 percent separation between first and second place suppliers, the City of Danville was able to attain true market value for its purchase.
“The City of Danville represents yet another example of the public sector’s renewed focus on efficiency through cutting-edge technologies and strategies,” said BidBridge CEO Jim Headlee.
BidBridge also hosted another Danville bid event for a rescue pumper fire apparatus on November 24.
A large county in Georgia engaged BidBridge for the purchase of 2010 Microsoft Licenses for its software.
15 suppliers competed in the 49 minute event, yielding 164 total bids, 13 first place turnovers and 35 time extensions.
The final pricing yielded a 17% savings versus budget and against state contract price.
Incumbent Supplier Wins Bid; Supports Reverse Auction Platform
LAKELAND, Fla., Dec. 1 — The City of Lakeland, FL recently leveraged new technology and strategy for the bid process on its one-year waste hauling contract. The deliverable: hauling 19.25 million gallons of fertilizer and class AA residuals from two wastewater reclamation plants over a one-year period. The platform: eBridge, a proven e-procurement services provider for the public and private sectors. The result: a 40 percent savings for Lakeland against the previous year’s contract.
eBridge creates a dynamic purchasing environment by offering a secure, real-time electronic sealed bid platform that allows suppliers to place multiple bids, giving suppliers the opportunity to actively compete in the marketplace. The ensuing bid process provides entities with an alternative to the public sector’s traditional process of a one price per supplier response, while maintaining the integrity of the competitive, sealed bid process.
In the past, eBridge and Lakeland had teamed for several successful events, including calcium carbonate transportation (one-year contract), tennis court resurfacing and floor resurfacing bids. For Mark Raiford, Lakeland’s Director of Purchasing, continuing the city’s success with eBridge was simply the best option.
“Our past experiences had led us to the conclusion that eBridge was a professional, cutting-edge organization with the talent and tools to help get the job done,” said Raiford. “This time around, eBridge stayed true to its reputation and helped us achieve some of the best results we’ve seen so far.”
Seven hauling service providers competed over the one hour and 41 minute event, logging a total of 250 bids and 86 clock extensions. First place changed hands a total of 57 times. In the end, the incumbent supplier was awarded the bid.
“Lakeland is a prime example of how public organizations can continually leverage a reverse auction platform in their procurement activities,” said eBridge CEO Jim Headlee. “It really doesn’t matter what the item or service is; reverse auctions that leverage the right technology for buyer visibility apply to almost any purchasing activity.”
About eBridge
Founded in 2002, Louisville-based eBridge provides fully managed e-auction services to both the public and private sectors. Through its competitive sourcing and online procurement system and services, eBridge assists its buyers in achieving true-market value for the goods and services needed for ongoing business operations. Significant cost reductions and procurement efficiencies have allowed eBridge’s buyers to save millions of taxpayer, corporate and investor dollars, ultimately producing a positive effect on compressed budgets.
For more information, please visit: www.ebridgeglobal.com
Pricing beats state contract prices for vehicles
A southern California school district partnered with eBridge, for the purchase of 2010 and 2011 model vehicles. Two suppliers competed to supply the following:
2 cargo vans
2, ¾ ton pick-up trucks
1, 1-ton crew cab with standard pick-up
3, 1-ton crew cab and chassis
The event lasted 2 hours and 36 minutes, yielding 145 bids, 112 time extensions and 73 first place turnovers. The two suppliers’ prices were separated by only 0.04%, indicating true market value for the vehicles was achieved.
Overall, the school district achieved 34% savings versus budget.
It is important to note that the school district had the opportunity to purchase the vehicles through the pricing established by the city. The city’s pricing was established in 2008, when the price of vehicles was soft due to the state of the automotive industry at that time. Even compared with the pricing established by the city last year, the bid still achieved 34% savings.
Additionally, the two automotive dealers participating in the event were excited about the process and are looking forward to participating in another bid with eBridge.
Going once, going twice
Saturday, November 14, 2009
by: Jonathan Bilyk
Brad Cauffman has heard the refrain from frustrated would-be vendors for years. “They see the final price that we accept, and they say things like, ‘All I had to do was drop my bid by $500? I would’ve done it,’ ” he said. “So to us this just made sense to try it out.
“And from what we’ve seen, we’ll probably do it again.”
Earlier this summer, Cauffman, assistant superintendent for business services at the St. Charles School District 303, supervised what would be a first time event among Illinois school districts — a reverse auction.
The item up for bids in this case was paper — an entire truckload of copier and printer paper. Or, to be more precise, the item up for bids was the right to be paid by District 303 to supply the truckload of paper for the 2009-2010 school year.
Traditional auctions begin low and do not end until potential buyers reach the point at which they are not willing to pay more. But in a reverse auction, it is the sellers who compete with each other in a race to the bottom, to find the lowest price at which they are willing to sell their products to an interested buyer.
Since the 1990s, the process has made consistent gains in popularity in the private sector, as companies of all sizes have used the process to trim costs compared to traditional purchasing and bidding techniques.
However, the reverse auction concept has found slower going in attempting to gain a foothold in the public sector.
In Illinois, for instance, local governments were limited by law to methods like the sealed bid when using tax money to purchase goods and services. That essentially made using reverse auctions illegal, or legally questionable, at best.
This summer, however, the state enacted a new law specifically permitting local governments and taxing bodies to use the reverse auction process to purchase goods. The law, however, continued to bar local governments from using reverse auctions to secure bids for construction projects or to obtain professional services, such as engineers.
One of the chief sponsors of the new law was State Sen. Chris Lauzen, R-Aurora.
“It sounded like it made perfect sense,” Lauzen said. “We want to provide high quality service to our citizens, and to do it at the lowest possible cost.
“And this seemed to be a good way to try to do that.”
Within weeks of the measure becoming law, District 303 had signed on with Louisville-based BidBridge to organize just such an auction for its paper contract.
The way BidBridge’s process works is simple: BidBridge and the buyer — in this case, District 303 — prequalify certain companies to bid, reviewing, for instance, their capability of meeting the district’s supply requirement.
From there, BidBridge schedules a time for the auction, which is conducted electronically. The auction lasts 30 minutes, but can be extended by three minutes, should a supplier put in a lower bid before the auction ends. That then allows the other bidders to submit lower counter bids, as well. The auction ends when no supplier submits a lower bid within three minutes.
The program creates a scenario in which buyers can sit in front of a computer somewhere and watch their price go down and down and down.
“It’s a wonderful feeling,” Cauffman said.
District 303’s reverse auction for paper lasted about 52 minutes and ultimately saved the district about $18,139, or about 12 percent, when compared to the state contract for paper.
So far, District 303 is the only unit of local government in Kane County to take the reverse auction plunge.
But the results garnered by the auction have caught the attention of others in the area, prompting a number of local taxing bodies to begin either looking into the possibility of reverse auctions or talking directly with BidBridge about running similar auctions in the future.
Officials at Geneva School District 304 are reviewing their contracts to see if there might be some that would benefit from a reverse auction.
Assistant Superintendent for Business Services Donna Oberg said her district might not benefit from the reverse auction as much as larger districts, such as District 303.
“We probably don’t have the space to store that much paper, for instance,” Oberg said.
Rather, she said, the Geneva district has sought to save money by maintaining its membership in the Lake Bluff Consortium, a group of 42 school districts that buys its paper in bulk. While the district pays a little more than what District 303 paid, the paper is delivered as the district needs it.
However, that consortium does not help the district with contracts for other consumable products, she said, and the district would consider BidBridge or other companies’ aid in obtaining lower prices for those products.
Reverse auctions have also gotten the attention of the Batavia School District 101.
Kris Monn, District 101’s assistant superintendent for finance and operations, said his district is very excited by the opportunities offered by reverse auctions.
“It just seems like a terrific way to drive down costs,” Monn said. “We are trying to find the next big ticket item that we have coming up, so we can hopefully use this process.”
Guy Ramsey, an operations analyst with BidBridge, said his company has also had contacts with the city of Batavia, Aurora, Campton Township, the Geneva Park District and even Delnor Hospital.
“We’ve gotten a lot of attention in Illinois since the St. Charles bid,” Ramsey said. “But you can make a lot of headway when you save someone’s neighbor a lot of money.”
Ramsey, however, noted that his company’s ability to use reverse auctions to save taxpayer money will be limited in Illinois by the construction and professional services exclusions in the law.
But, he said, lobbies for construction-related industries in Illinois and other states have prevented BidBridge and other supporters of reverse auctions from successfully changing the law.
Lauzen said he would support such a change in the law.
“That’s a huge exemption,” Lauzen said. “Construction is where the real money can be saved, and I would eventually like to see the law broadened.
“But, for now, this is a start.”
What is a reverse auction?
Unlike a traditional auction, reverse auctions use a bidding process to help buyers obtain the lowest prices for the items they are seeking.
Suppliers essentially compete to see who can go lowest. In the end, the process can save thousands of dollars for local governments looking to buy anything from copier paper to automobiles, say those who run the service.
By JIM HEADLEE
Published November 6, 2009: Community College Times
Uncertain economic times have forced businesses, government agencies and academic institutions across the country to tighten budgets and search for new cost-saving strategies.
To stay on the cutting-edge of technology and progressive business, a growing number of schools and higher education institutions are looking into the benefits of reverse auctions for procuring goods and services.
In the past, organizations in the public sector have practiced procurement through more traditional means, like one -price-per-supplier response. But today’s procurement strategies don’t always adhere to best practices that can help organizations drive prices closer to market value. While the concept is not a new one, many organizations have been lax to adopt a procurement platform that features reverse auctions as its core component.
Reverse auctions fill a much-needed void in the procurement process by offering visibility for the purchasing organization, true competition between suppliers, standardized buying methods and reduced overall spending. Implementing a reverse auction platform can greatly reduce both purchasing costs and transaction processing costs.
Research by PriceWaterhouseCoopers and Killen & Associates indicates reverse auctions can log a 5 percent to 10 percent savings in purchasing costs while increasing profit margins by 28 percent to 50 percent. Aberdeen Group reports that with e-procurement, transaction processing costs drop by as much as 70 percent.
To leverage the most efficient technologies, community colleges looking to use reverse auctions for purchasing should consider an e-procurement platform. E-procurement offers organizations significant advantages over traditional platforms, including greater visibility for the purchasing organization, real-time updating, a dynamic and time-efficient experience and secure management—all while promoting increased competition between suppliers, ultimately driving down prices for goods and service.
In order to successfully integrate a reverse auction/e-procurement platform, community colleges must take three key factors into account:
Full support within the buying organization. In many cases, multiple parties at a community college are involved in the purchasing process. Making sure all levels involved in the decision embrace the strategy—from board members to directors to central purchasing to the department requesting the goods/services—is crucial.
Open specifications allowing for competition between multiple suppliers. Sometimes procurement specifications are developed in a way that significantly favors one supplier. In order to promote true competition, the reverse auction process should only take place if the purchasing process includes open specifications revolving around factors such as quantity needed, delivery expectations, peripheral costs, payment terms and discounts, and ceiling/floor guidelines.
Willing participation from a base of multiple, educated suppliers. To ensure a truly competitive environment, many e-procurement services practice strategic sourcing, a process that is difficult for community colleges to undertake on their own time. More experienced reverse auction platform providers have a diverse base of suppliers with which they have established relationships and notify of upcoming bid opportunities. Some providers even go the extra mile, exhausting every possible channel for finding new suppliers to compete for the business.
As an example of how the reverse auction process can benefit the education industry, San Diego State University (SDSU) worked with an e-procurement services provider on two bids. In the first bid, four suppliers competed to provide the institution with HP Blade Servers and backup software. The bid, taking place earlier this year, lasted a total of one hour and seven minutes and logged 128 unique bids. At the conclusion of the event, SDSU had saved $18,000 against budget.
In May, the institution’s second bid returned similar results. Seven suppliers competed to provide the university with new tables and chairs for the university library. First and second place suppliers were only separated by a margin of .31 percent. The lower the percent separation, the stronger the indicator that the university achieved market value for the procured goods.
SDSU provides a compelling argument for why more institutions should consider a reverse auction platform to obtain goods and services. As technological and procurement landscapes continue to evolve, the education industry needs to be at the forefront of these niches.
Headlee is CEO of eBridge.
In the county’s second event with eBridge, four suppliers competed for the purchase of one rubber tire wheel loader. The one hour, five minute event yielded 85 total bids with 39 first place turnovers and 58 time extensions, allowing the four suppliers to compete in real-time for the contract.
During the event the average bid drop was $2349 per bid and at the conclusion of the event first and second place bidders were separated by only $1.00!
The county achieved approximately a $10,000 savings on the wheel loader, and was assured it received true market value with the $1 differential between first and second place.
BidBridge was approached to run the fuel bid for Greater Clark County Schools for the second year in a row.
In this year’s event four suppliers placed bids for a two year contract to provide diesel and unleaded gas to the school district. Specifically the contract was for 58,000 gallons of unleaded and 120,000 gallons of diesel fuel.
The same four suppliers competed on both line items, both yielding over 50 bids, 34 time extensions and less than 2% between first and second place bidders.
As a comparison to last year’s contract pricing achieved through BidBridge, Greater Clark County Schools paid 0.1475 per gallon for both the diesel and unleaded fuel. For the 2009-2011 contract, low bids came in at 0.0825 for unleaded and 0.0889 for diesel fuel, almost half of the price from last year.
While fuel prices have significantly decreased over the past year, BidBridge helped this school district achieve true market value for the purchase of the fuel for the next two years.
ITMO Attains Contract for State CDL Manual and Driver Handbooks at True Market Value
COLUMBIA, S.C., Nov. 10– When South Carolina’s Information Management Technology Office needed help procuring a contract for Commercial Driver’s License (CDL) manuals and driver handbooks, the State purchasing office knew exactly who to approach.
Since establishing a state contract in July 2009, the State of South Carolina has engaged Louisville-based BidBridge, a proven eProcurement services provider for the public and private sectors, for large capital expenditures. The successful events have yielded massive savings against budget.
To help organizations get the best price possible, BidBridge creates a dynamic purchasing environment by offering a secure, real-time electronic sealed bidding platform that allows suppliers to place multiple bids. The ensuing bid process provides entities with an alternative to the public sector’s traditional process of a one price per supplier response.
The 55-minute bid event took place between three suppliers, logging 30 total bids, 11 first place turnovers and 21 time extensions. First and second place vendors were separated by a mere .03 percent, indicating market value had been achieved on the new printing contract.
Since entering in to a state-wide contract with BidBridge, the State of South Carolina has saved 26 percent overall against budget for the events run. The five events have been spread across three other state entities: the Department of Motor Vehicles (DMV), Department of Transportation (DOT) and the state’s public television station, ETV.
“BidBridge’s work with the State of South Carolina stands as a testament to the countless applications reverse auctions have for the public sector,” remarked BidBridge CEO Jim Headlee. “Especially in a shaky economic rebound, making the most of public money is an important step for public entities towards a more efficient allocation of tax dollars.”