How to Run a Business to Business Online Auction

This article addresses the business-to-business online auction approach for auction values in excess of a quarter of a million dollars or pounds.


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    The first step is to pick your category to take to auction. This can be a daunting task owing to the complexity the average business faces in their purchased goods and services. Aim for categories that can be clearly defined and specified, that are likely to attract the interest of bidders, and that have a sufficient number of bidders in the market. Ideally you would have at least three motivated and capable bidders taking part in your auction.
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    Once you have chosen a category, the next step is to define it and all the items contained within it. Generally e-auction software allows you to upload drawings, specifications, photos, brochures, and any other file that can help to clarify what exactly it is that you are looking to buy or sell, depending on whether it is a forward or reverse auction that you wish to run.
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    The third step is to find and engage the bidders to take part in your auction. This is known as the sourcing exercise. Cast your net far and wide to make sure you find the best bidders in the market. Speak to each bidder in person if time allows as this will give you a chance to establish a relationship and gain an understanding on how you can mutually benefit each other, beyond just a question of price.
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    At this stage you may wish to obtain qualification prices. This allows you to gain an understanding of any discrepancies in the information you gave them by seeing if certain submitted prices are wildly different. It will also enable you to get a provisional understanding of which bidders are in the right ball-park and which are either much too expensive or much too cheap, in which case you may wish to have further conversations with them with perhaps a view to eliminate them from the auction. The final advantage of using this qualification price stage is to assess whether any items that you have included should be removed from the auction, for example if no one has bid for them or if the only bids you have received are not competitive.
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    Now that you have defined what it is that you are taking to auction, have established who your bidders are and made sure that they are all motivated and keen to take part, and confirmed that the items you are taking to auction have received competitive quotes, then you are ready for the auction itself. Right before the actual auction, you may wish to take your bidders through a training exercise on perhaps a test auction to make sure they know how to bid and to confirm with them exactly what it is that they are bidding for
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    The final step is to run the auction. Most e-auction software allows you to monitor your bidders and who is presently logged on. Any absent bidders should be chased up by telephone to ensure they are able to take part. The auction itself would most commonly be set for a 30 minute duration with the ability to auto-extend should a bid be placed in the last few minutes. Make sure you are present throughout to answer any questions that may be posted during the auction. Once the auction is completed, be sure to thank all your bidders for their time and commitment to your request and reassure them that you shall give them the feedback that they deserve.


  • Start off with the less complex categories to help build your confidence to tackle the more complicated ones that will mostly likely unlock huge value to your company.
  • Be specific and clearly define what it is that you are auctioning.
  • Involve other people in your company to help you with technical questions and queries, as well as support in finding the right bidders and pulling together the specifications for your categories.
  • Use e-auction software providers that are clear with their pricing, ideally listed on their website, and do not charge you extras for training or high value categories.
  • Having a sufficient number of capable and interested bidders is a must


  • Managed e-auction providers and consultancies will charge you in excess of £15,000 to £30,000 to run an auction for a median-sized spend category. You can run these auctions yourselves, so believe in yourself and you can bring about a huge return for your company.
  • Consider using an experience e-auction software provider such as or

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Categories: Purchasing