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The different types of reverse auctions

An auction is described as reverse when it gathersone buyer and many sellers.

(a classical auction gathers one seller and many purchasers)

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The choice of the type of auction is determined

by the analysis of suppliers offers at the end of the RFQ

by the information about the market given by the buyer

RFQ

constitution

Supplier

selection to

quote

Sending of

RFQ files

Request for

homogenei-

zation of the

offers

Reception

of suppliers

offers

Supplier

selection

English auction ?

Dutch auction ?

Dynamic auction ?

AUCTIONReception

of comparableoffers

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Supplier 1

Supplier 2

Supplier 3

Supplier 4

English auction

Decreasing auction (or increasing if it is a sales auction)

The supplier can only place a bid better than the leading bid

The auction stops when there is no more bid

Business awardedto the winner

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Dutch auction

Increasing auction (upon configuration by the buyer, the system offers a bid

that increases at regular intervals)

The selected supplier is the one who first accepts an offer

Business awarded

to the winner

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Dynamic auction

Decreasing auction (or increasing if it is a sales auction)

The supplier can only place a bid better than his previous bid

He can compare his bid with the best bid of the moment

Either by his price compared with the best price

Or by his ranking compared with the first

Business awardedto the best global offer(price + other criteria)

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With each type of auction corresponds a specific configuration

Setting of the opening price of the auction

Outcoming from the suppliers offers (from the consultation)

Setting of the decrement (purchasing auction) ou incrment (sales auction)

Duration of the auction

Usually 20, in case of extension time, setting of the extension rules

Setting the information release rules

Allows competitors more or less transparency

Lead bead Ranking

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PSA Peugeot Citron ethic rulesreleased as early as March 2003

(french law in August 2005)

sent to all our suppliers

PSA Peugeot Citron Code of conduct available online on the B2B portal, in the Documentsavailable for all to view area

every auction leads to a business being awarded

only a supplier that participated in the auction can be awarded the business

after the auction, different criteria (technical, logistics, quality) are taken into account forthe final award