In the context of the Government e-Marketplace (GeM) in India, both bidding and reverse auction are mechanisms used to facilitate procurement processes, but they operate differently. Here are the key differences between bidding and reverse auction in GeM:
- Bidding:
- In bidding on GeM, the buyer (government department or organization) posts a procurement requirement specifying the goods or services needed, along with any relevant terms and conditions.
- Suppliers registered on GeM can view the tender and submit their bids, indicating the quantity of goods or services they can provide and the price they are willing to offer.
- Bidding in GeM typically involves suppliers submitting their offers, which may or may not be visible to other suppliers. The prices offered by suppliers may or may not be negotiable.
- After the bidding period ends, the buyer evaluates the bids received and selects the winning bid based on predefined evaluation criteria, considering factors such as price, quality, delivery time, and other relevant parameters.
- Bidding is a common method used in procurement processes to solicit offers from suppliers and select the most suitable bid based on a comprehensive evaluation.
- Reverse Auction:
- In a reverse auction on GeM, the buyer posts a procurement requirement similar to bidding, specifying the goods or services needed and any relevant terms and conditions.
- Suppliers registered on GeM can view the reverse auction and participate by submitting their bids, indicating the quantity of goods or services they can provide and the price they are willing to offer.
- Unlike traditional bidding, in a reverse auction, the prices typically decrease over time as suppliers compete to offer the lowest price. Suppliers may adjust their prices multiple times during the auction to remain competitive.
- The buyer monitors the bids in real-time as they decrease and evaluates them based on price, quality, and other relevant factors.
- At the end of the reverse auction, the buyer selects the winning bid based on the lowest price offered by a supplier meeting the required criteria.
- Reverse auctions are designed to promote competition among suppliers and drive down prices, allowing buyers to secure goods and services at competitive rates.
In summary, while both bidding and reverse auction are methods used in GeM for procurement, bidding involves suppliers submitting offers based on specified requirements, while reverse auction involves suppliers competing to offer the lowest price over a specified period.