This article has been published the 20th of April on www.tmcnet.com. It’s interesting to see how Public bodies are appreciating e-Auctions and to hear finally that reverse auctions are not only about the cheapest price… if the buyer wants so.
The OGC is once again encouraging local authorities to use reverse auctions to buy products but has promised no return to the cheapest price wins approach. Speaking at local e-gov Expo 06, the OGCs deputy chief executive, Peter Fanning, said local government organisations needed to do more to save money when buying products and services.
He said strict targets for savings part of the Governments 21bn savings programme could be achieved through a process of better buying, which includes the increased use of reverse auctions also known as e-auctions. An OGC spokesman stressed that reverse auctions were only being encouraged in specific circumstances and were not suitable for all public sector tenders. We want to be flexible and this is not a return to cheapest price but is looking for best value for money, he claimed. The important thing to stress is that e-auctions are not valid in all circumstances and are [only] good in the right context.
We are not bound to take the lowest bid, he added. The IT industry seems to have a more sophisticated view. They had concerns but a lot can get their heads around [the concept] because they understand how it works. Kelvin Brain, director of consultancy at Compusys, said it was good that the OGC was recommending flexibility in buying methods. But there needs to be more guidance on buying services because there are great disparities in the prices being paid for similar things, he claimed.
Des Lekerman, joint managing director at Eurodata Systems, said it was still a challenge to do business in the public sector. It is still an exclusive club and difficult for mid-sized companies like us. We have to partner the bigger players that are accredited, added Lekerman.