LAS VEGAS— PurchasePro has begun producing monthly microeconomic reports detailing the purchasing trends and savings generated through its e-Source auction software. The e-Source purchasing solution, which was launched in May, generated 95 reverse auctions in June and attracted 2,162 bids from 509 suppliers. To date, purchasers are averaging 10% savings on all business conducted through the auctions, and some buyers have saved up to 60% on various commodity items, such as bottled water. PurchasePros software, which was purchased from Baybuilder in April 2001, provides corporate buyers with real-time access to suppliers willing to bid for their business. A purchaser submits a request for an item and the quantity of units needed, then vendors bid on the business for a designated period of time. “Its similar to Ebay,” said Chris Benyo, svp/marketing network and development. Rather than increasing the bids as the auction progresses, vendors compete to make the lowest bid. However, the winner of the auction is not guaranteed the business; it is still subject to the purchasers approval. “To professional buyers price isnt everything,” said Benyo. “It still comes down to doing business personally. This is just a tool to set the price level. Often the final two bidders are called in by the purchaser, and still have to bring in samples and give a traditional presentation.” He noted that the lowest bidders might not offer all the attributes or qualities that the purchaser is looking for, which is why the software was designed to offer “flexibility.” “If its a commodity, like paper clips, the lowest bidder usually wins. But if its a service, thats not necessarily the case,” added Benyo. Using the softwares transformational bidding tool, purchasers can lay out specific requirements before registering their business, such as the desire for a three-year warranty on the product. “Extra features are weighted to raise the bid. So a vendor might make a $10 bid but because of extra features, that bid is listed as $12,” said Benyo. While all of PurchasePros hospitality suppliers participate in the reverse auction software, the company currently has no hospitality purchasers using the software, and hopes to see that change in the near future.
