Scanmarket saves its client $4 million in 1 year on coffee machines with Cherry Picking e-auction.

Challenge

This Scanmarket client was looking to purchase coffee machines for different locations across Europe. The buyer needed 3 different types of coffee machines for 9 locations in Europe. The buyer wanted to allocate all business to 1 supplier in a 1-year contract. Spend for the previous year amounted to €13,199,710, so potential savings were huge.

Solution

Some suppliers were not able to bid on all coffee machines, so a Cherry Picking auction was chosen, and suppliers were blindfolded on those items. To simplify the auction setup, suppliers were asked to quote a total price per machine including all destinations, and 3 product lines for each machine were created in the auction. Suppliers were requested to pre-quote prior to auction, and pre-quotations were entered as individual starting prices. 9 suppliers were contacted.

Result

The Cherry Picking eAuction received 54 bids in 1 hour and 15 minutes saving Scanmarket's client €3,476,210 (26.34%) from the previous year.