E-Auction or electronic auction is the process of buying or selling goods or services electronically based on bids through an auction platform. E-auctions are used to buy or sell surplus inventory, dispose unsold goods or even conducted by government agencies to sell surplus assets.
E-auctions are an efficent way to reduce the costs involved in procurement process as it can reduce the time spent on negotiation as the suppliers will be competing in real-time. There are mainly two types of e-auctions namely- forward e-auction and reverse e-auction. In reverse e-auction suppliers compete against each other for a lower bid, making it the most preferred method. In Forward e-auction, the bid starts at a lower price and increases based on bids by competitors.
E-auctions are preferred for categories that involve higly standardized products or services.
