Forward vs. Reverse Auctions

In a nutshell, there are really only two categories of auctions — forward and reverse auctions. There may be variations with these based on a number of factors, including the progress of the auction and the criteria for determining the “winner” of the auction.

Forward auctions take the form of a single seller offering an item for sale, with buyers competing to secure the item by bidding the price upward. Forward auctions are far-better understood by the public at large than reverse auctions as to how they operate, due primarily to the fact that they are widely used at the consumer level. They are also widely used when the goal is for the seller to receive the most money possible for the item being offered at auction. Thus, a forward auction should be utilized for sales of goods and services of all types, whether conducted online, offline or a hybrid of the two.

Reverse auctions are the other major form of auctions. In a reverse auction, a single buyer makes potential sellers aware of their intent to buy a specified good or service. During the course of the actual reverse auction event, the sellers bid against one another to secure the buyer’s business, driving the price to be paid for the item downward. Thus, the winning bidder is the seller who offers the lowest price. Reverse auctions are most typically used for procurement by private companies, public sector agencies and nonprofit organizations.

Reverse auctions are not a short-term tactic for procurement operations, but are, in fact, a proven method for long-term management of indirect spend — delivering significant savings and process efficiency. For more information on reverse auctions and the procurement process, visit Reverse Auction Research online at www.reverseauctionresearch.org.

Source: Reverse Auction Research (www.reverseauctionresearch.org)

This article originally appeared in the College Planning & Management September 2013 issue of Spaces4Learning.

Featured

  • Norfolk State University Partners with Voltus for Energy Efficiency Program

    Norfolk State University recently announced that it has selected Voltus, Inc., to implement the university’s new energy efficiency program on its campus in Norfolk, Va. According to a news release, the partnership’s goal is to reduce campus energy use by 27% by the year 2030 and support grid reliability across the state of Virginia.

  • Oregon Institute of Technology to Construct $35M Mass Timber Residence Hall

    Oregon Institute of Technology in Klamath Falls, Ore., recently announced the construction of a new, $35-million mass timber residence hall, according to college news. The facility will stand four stories, have room for 517 students, and cover 86,710 square feet to address the college’s need for more on-campus housing.

  • Michigan School District Installs New Gun-Detection Platform

    Williamston Community Schools in Williamston, Mich., recently announced that it has installed the ZeroEyes gun-detection video analytics platform for its five schools, according to a news release. ZeroEyes is the only solution of its kind with a U.S. Department of Homeland Security SAFETY Act Designation and adds an AI gun-detection and intelligent situational awareness software layer into existing school security cameras.

  • Education Design Showcase

    Spaces4Learning Launches 2025 Education Design Showcase

    Spaces4Learning is now accepting submissions for the 2025 Education Design Showcase! Launched in 1999, the program celebrates innovative and practical solutions in planning, design, and construction.