6/30/09: Eliminate Budget Shortfalls by Buying Smarter

 

In the barrage of layoffs, pay reductions and Chapter 11’s, it is relieving to see some organizations solve budget shortfalls in a more positive, and less destructive way, by using the Ebid method to shave an additional 12-24% off their procurement spend.

For a city the size of Dallas, the Dallas school district, or states such as California or Michigan, this equals $50-$100 million in annualized savings. All organizations have access to Ebidding but some claim cost is the reason they have not begun using it. With an Ebid service like Sorcity.com buyers pay no fee and access is immediate, so these savings are easier to reach.

AAFES, the U.S. Air Force, and many other public and private sector organizations have utilized the Sorcity.com Ebid service to gain big price reductions on many goods and services, resulting in savings. This is multiplied when an organization uses Ebidding for the majority of their purchases.

 

The Ebid method is rather simple; instead of the buyer going through painstaking negotiations, bidders openly compete in an Internet forum against each other, bidding lower and lower prices real-time as you watch your price drop. The buyer saves a great deal of time, has access to many more suppliers (with Sorcity), and retains control over the purchase, so quality and service-levels don’t change.

Some organizations have watched on the sidelines but are now getting more pressure to cut costs. Ebids (AKA reverse auction, eRFQ and eRA) can benefit them also, if they use it, as evidenced by success stories presented at ISM and NIGP and 10-years of benchmarked lower prices.
 

A Dallas area school district and several surrounding cities have used Sorcity and saved millions of dollars. One averaged 16.2%, another 25% and another over 30% below their existing prices. Anything from office supplies and packaging materials to computers and capital purchases are Ebid. Why be chained to traditional negotiations.
 

This is the answer CEO’s and CFO’s have been looking for. Wes Guillemaud, CEO of Sorcity, says; “Our biggest challenge is informing an organization they can save millions of dollars more, in less time, at no cost to them, and then getting them to believe it. It sounds too good to be true until you try it.”