Definition of Reverse auction:
Type of auction in which several sellers offer their items for bidding, and compete for the price which a buyer will accept. The buyer usually has the option to accept any bid or reject all. Bid-based construction or supply contracts are examples of reverse auction. Also called business to consumer auction.
Any of various types of auction in which the normal bidding process is modified, specifically one in which the purchaser of a product or service invites bids from multiple vendors and typically selects the lowest offer.
Reverse auctions gained popularity with the emergence of internet-based online auction tools that enabled multiple sellers to connect with a buyer on a real-time basis. Today, reverse auctions are used by large corporations and government entities as a competitive procurement method for raw materials, supplies, and services like accounting and customer service.
A reverse auction is a type of auction in which sellers bid for the prices at which they are willing to sell their goods and services. In a regular auction, a seller puts up an item and buyers place bids until the close of the auction, at which time the item goes to the highest bidder. In a reverse auction, the buyer puts up a request for a required good or service. Sellers then place bids for the amount they are willing to be paid for the good or service, and at the end of the auction the seller with the lowest amount wins.
How to use Reverse auction in a sentence?
- Construction companies take advantage of reverse auction s frequently, as it is a place to directly offer a bid on a new project to a customer.
- Many times when public sector companies are looking for a contract, they may into a reverse auction . Here, businesses compete in offering their services, for the companies price.
- The North Carolina Department of Transportation decided to choose Caterpillar from the reverse auction because they delivered met the specs with the best piece of equipment at the best price with their bid.
Meaning of Reverse auction & Reverse auction Definition