April 26, 2018 2:52 am
Search Advanced Search

Frequently Asked Questions

  Reverse Auctions & Sealed Bids - Intro   Help Index  
RFP/Procurement - Buying & Selling
While the Standard Auctions are created by Sellers, the "Request for Purchase (RFP)" is created by Buyers.

The Procurement Modules offers purchasing professionals two distinct procurement formats, the classic "Competitive Sealed Bid" and the new dynamic purchasing model, the "Reverse Auction". There are a number of differences between the two systems.

Buyers using the "Competitive Sealed Bid" and "Reverse Auction" can choose either the public bid viewed by the general public or an private closed RFP, with only invited suppliers aware of and able to bid on the project.

With the Private Sealed Bid or the Private Reverse Auction, a Private Business Network, the buyer has the ability to pre-qualify suppliers or to choose a set of existing suppliers before sending an invitation.

The Sealed Bid
The "Competitive Sealed Bid" is the traditional competitive low sealed bid system most us of have used on school, institutional, corporate and government projects.

The system is simple; a Buyer creates a RFP with scope of work, project or product specifications, drawing, details, photo's and contract documents.

Suppliers or contractors can submit one bid that is sealed till after the bid closing time and in most cases the bid is awarded to the lowest bidder. The Competitive Sealed Bid system on iSolar Exchange is no different, just faster and more efficient.

The advantage of the online system is speed and the ability to reach out to more suppliers or contractors regionally, nationally and global.

The Buyer publishes his RFP's plans, specifications and other attachments online and these can be downloaded and printed out. This alone saves the cost of printing and distributing plans and documents.

The Buyer creates and posts the RFP for a review period and sets up a time period for bid starting and closing. Bid times can be modified and addendum can be published. Questions and answers can be published in a RFP specific forum for communications between suppliers and buyers.

Suppliers can submit "one" bid, and the online procurement system will award the project to the low bidder.

The Reverse Auction
The "Reverse Auction" is different; the closest real world analogy to the Reverse Auctions is a form of real time price negotiations between many suppliers and a Buyer.

A real life example would be several EPC contractors negotiating a large new solar Array project with a Solar Developer. All EPC's start out with a preliminary price and with some EPC's more resourceful than others, some may be aware of their bid position, and the apparent low number.

Many times there will be several rounds of quoting and adapting to the various wants or needs of the Solar Developer. The rounds of bidding may take days or weeks. This is reverse price bidding.

In the "Reverse Auction", the Buyer creates a Reverse Auction RFP, and uploads all the information and specifications.

The Buyer also creates a maximum price ceiling on the "Reverse Auction" and this is the maximum price he will pay for the RFP. The ceiling price is typically based on preliminary pricing, or other current market pricing.

The "Reverse Auction" is in effect a Buy Out RFP. Suppliers find the price point to start their bidding under the Buyer's ceiling price. All suppliers pricing is viewed by all bidders, and the prices go down until the low price point is reached at which time the Procurement system awards the bid to the low bidder.

iSolar Exchange has incorporated a number of new Reverse Auction features. Besides the RFP price ceiling point, suppliers can bid up or below the low bidder, thus giving suppliers the ability to use bid strategy in the early auction stages. In the end only your lowest bid counts.

The "Reverse Auction" system is designed to prevent substitutions, alternates, and value engineering, only a dollar value can be submitted and with all pricing visible, a fair and level playing field is created.

Bid sniping is avoided in the "Reverse Auction" by the system automatically extending the bid closing time an additional ten minutes if any new bid is submitted in the final five minutes of the RFP closing time. This will continue until there are no bids in the last five minutes of the RFP, thus ensuring all final bids are not affected by the speed of bidders computers or the internet.



Home   |   About Us   |  Contact Us   |   Create RFP   |   Register   |   Login   |   Forums   |   Terms & Conditions   |   Help

Copyright © 2011 - iSolarExchange, Inc. - Connecting Solar Buyers and Sellers