E-auctions have a number of advantages. Due to strong competition and price pressure, e-auctions can lead to high cost savings when purchasing materials and services. In addition, the productivity of purchasing can be increased because more orders can be negotiated intensively. Detailed specifications are crucial for successful participation in e-auctions. They require a correspondingly good structuring of the procurement processes. The processes optimized in terms of quality and time in turn reduce the indirect procurement costs (process costs). Another advantage of e-auctions compared to classic negotiations is their transparency. The competitive situation is credible and realistic and many suppliers participate in the online process. Traditional trust relationships in e-auctions are replaced by fact-based relationships. In traditional procurement processes, to some extent, both sides had to rely on the accuracy of the business partner’s statements. E-auctions, on the other hand, provide both sides with an insight into the market situation and contribute to the dynamism of negotiations and intense price competition.
This facilitates technical negotiations, as cultural differences no longer play a significant role. In addition, e-auctions are effective. As a result of the automated processes, the majority of the contracts concluded will have conditions that would have required a much greater effort on the part of the purchasers in the traditional way. Although there are numerous advantages of e-auctions, there are disadvantages that users should at least consider. The cost savings already mentioned, for example, are offset by additional costs, such as license or provider fees for the auctioning software service provider. The development of specifications, especially non-price, requires increased concentration and attention.
In addition, e-auctions do not allow time for technical or commercial calculations and post-bid adjustments are usually not possible. Therefore, the conditions must be defined and communicated in advance. However, the fear that participating in e-auctions could damage strategic supplier relationships is negligible as they are rarely handled through e-auctions. Materials and services that are the subject of strategic partnerships still require the personal and creative cooperation of business partners to achieve a win-win situation for both parties.