| The first reason is that if you try to do a post-reverse | | | | always feel comfortable with the vendor's quality, |
| auction qualification, to the bidders, that gives them the | | | | customer service and delivery standards. If you are |
| impression that price really doesn't matter. So why | | | | willing to accept the lowest bid as the winner bid, and |
| should they bid lower in the reverse auction if they | | | | the vendor's know this, you will get lower prices |
| believe their quality alone will win them the business? | | | | because the vendors know they will get the business |
| Well, the Buyer's job is to pre-qualify bidders so they | | | | if they are the lowest bidder in the reverse auction. If |
| know that they are competing against like-quality | | | | you do not pre-qualify the vendors and just run a |
| vendors and price will absolutely matter during the | | | | reverse auction, the vendors are less likely to bid lower |
| reverse auction. A simple way to do this is to create a | | | | because they do not know what type of competition |
| survey with qualifying questions. Examples of these | | | | they are up against. The vendors may think that they |
| types of questions are how long the company has | | | | are bidding against low quality, low price firms and are |
| been in business, how many employees they have | | | | unwilling to have these low-ballers drive the price down |
| and if they have a proper level of insurance. This will | | | | on their higher quality items. |
| automatically give the vendors the impression that you | | | | In conclusion, openly pre-qualifying vendors before a |
| are doing your homework and are only going to invite | | | | reverse auction adds credibility to your dedication to |
| other companies that can meet these standards to | | | | awarding the business to a reputable vendor. If the |
| your reverse auction. | | | | vendors know you are honestly awarding the business |
| The second reason why you should have qualified | | | | in a fair and honest manner, they are more likely to bid |
| vendors is to guarantee that you are willing to accept | | | | lower to win your business because you have done |
| the winning vendor's lowest bid. The buyer should | | | | your homework. |