1 Reply Latest reply on Dec 21, 2009 8:31 AM by SundarK

    Network Equipment Reverse Auction

    Andrew Infante Newbie
      I recently ran a test RA with our Telecom team. They see value in including spordadic Cisco networking equipment purchases (routers, swtiches, etc.) in a RA. Currently, due to the sporadic nature of these purchases, the team distributes and receives sealed envelope quotes to/from a small group of prequalified resellers. Before we run a live event they want to communicate this sourcing strategy to the vendor based and gather vendor thoughts/opinions. Is there a communication that we can send to these vendors outlining the benefits (vendor and buyer), techincal requirements, and FAQs? Also, has there been success in doing a RA with resellers? Finally, do manufacturers (Cisco) of a resold product typically buy in?
        • Re: Network Equipment Reverse Auction
          SundarK Expert

          Hi Andrew:

           

          In discussing with our Commodity management team part of Ariba Global Services, I was able to gather some additional information that would help in executing this Sourcing Project successfully. Additionally I would also encourage to contact your Account Manager and have a discussion  around some of the Services (Ariba offers) centered around Category Knowledge management, Category Playbooks and Sourcing Event Execution which might be of help for this project and other Sourcing projects in the future.

           

          Nevertheless some of these thoughts may help run your Sourcing project efficiently:

           

           

          • Vendor Communication, e-sourcing related FAQs:

          An Opportunity Letter with a strong and communication to show the program vision, partner relationship (assuming they are going after resellers) should be a good starting point. Keep in mind that the decision of whether only Cisco equipment is targeted or client is flexible on other OEM equipment can change the content of this message. Recommend adding a note into the RFQ content or into letter on how to manage the Q&A (from Suppliers)

           

          • Technical Requirements:

          Suggest that you consolidate main requirements and create a limited number of specs; whether that be generic or specific Cisco equipment (in which case you should identify the equipment with Brand name, Model number or equivalent). If you need further help on developing technical spec requirements with spec details, I would suggest them to reach out to your Ariba Account Manager to get assistance from Ariba Global Services as a Services option.

          • Success of RA with resellers and OEM buy-in:

           

          Ariba Global Services has run multiple projects specifically on Cisco equipment and SmartNet services with resellers. Unless you have a very large purchase volume to be considered a strategic partner to Cisco, the demand usually goes through Gold/Silver/Bronze integrator partners of Cisco. Each have different discount margin on equipment depending on their purchase volume and business size with Cisco. These integrators are typically used to participating in reverse auctions but it is key to consolidate business demand, in terms of key products and best-estimate volume (volume is usually not a commitment, but a best forecast, and this is formulated appropriately in the bidding language).

          Hope this helps,

           

          - Sundar