The Day Nobody Came to Our eAuction

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Hi {{FIRST_NAME|readers}},

This week's piece on lessons learned from eAuctions comes from Laura Damian, a procurement and business transformation leader with 20+ years of international experience across FMCG, pharma, and fashion.

Based in Barcelona, Laura is the Indirect Procurement Manager at Desigual, where she also serves as Innovation & AI Ambassador, identifying automation opportunities and supporting digital agent development across the procurement function.

I've run a few eAuctions over the years myself, and they are a legitimate sourcing tool worth having in your toolbelt. The technical setup is honestly easier than most people expect.

However, where things get tricky is everything around the auction:

That's exactly what Laura digs into tonight.

She shares a story from early in her career about a reverse auction that went sideways, and uses it as a launching point to challenge how to think critically about eSourcing tools.

If you’ve ever wondered about the double-edged sword that is eAuctions, tonight’s piece is for you.

Onwards!

P.S. Yes, fishing was amazing. Thanks for asking.

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Picture this: a procurement team, a carefully configured reverse auction platform, and a strategic raw material contract on the line. Launch day arrives. The clock ticks. And nobody shows up.

That actually happened to me early in my career. We had set up a reverse auction for our annual MSG contract (monosodium glutamate), a strategic raw material sourced from a Japanese supplier we had worked with for years. The platform was configured, the invitations sent. And our suppliers simply chose not to participate. No bids. No result. Just weeks of work to repair a relationship we had quietly damaged by treating a long-term partner like an interchangeable vendor. It was an expensive lesson… Not in money, but in culture and trust.

That experience stuck with me. Not because it was dramatic, but because it was entirely avoidable.

Online negotiation platforms offer a standard set of features: category-based sourcing, RFQ templates, selection criteria frameworks, award workflows, and document storage. Useful on paper. But the real mechanic behind e-auctions is psychological pressure. Suppliers compete against each other in real time, watching prices drop, with the implicit message that the lowest number wins.

That works in a narrow set of conditions: true commodities, standardised specs, liquid markets with multiple qualified suppliers. Public procurement also has a legitimate case, where transparency and auditability are regulatory requirements.

Outside those conditions, the logic breaks down quickly.

Back around 2010, I observed a logistics auction with an auto-extension rule… Every last-minute bid reset the clock by five minutes. The price kept dropping. At some point it became obvious that no credible carrier could deliver at those rates. We stopped the auction manually.

The savings that look good in a report have a way of showing up later as
service failures, quality issues, or suppliers who quietly deprioritise your
account. eAuction metrics capture the price. They rarely capture what comes after.

For anything beyond a true commodity (which in indirect procurement is most things), rigid tender formats create their own problems. Fixed criteria and locked structures force both sides into a framework that doesn't reflect how markets actually work.

Effective negotiation requires flexibility: the ability to adjust variables as you learn what the market can offer, to factor in elements that don't fit a dropdown menu, to understand what matters to a supplier beyond price. That's not subjective… It's information. A buyer who ignores the human dimension of a negotiation isn't being more objective. They're just working with less data.

The procurement tech landscape has changed dramatically… And that's exactly the point. The argument here is not against technology. It's against rigid, legacy negotiation platforms that haven't evolved with the market.

Today, AI and digital agents are making global sourcing genuinely accessible. You can scan international supplier markets in hours, analyse fifty-page proposals with different structures and formats without forcing every supplier into an identical template, and run scenario modelling that would have taken a team weeks.

Documents and contracts live in SharePoint, Teams, or any collaborative tool your organization already uses, not locked inside a proprietary platform that charges per sourcing event.

There are exceptions worth acknowledging. In my current company, the
logistics department runs a dynamic auction system where carriers bid
continuously for individual loads (not annual contracts, but spot assignments based on real-time availability and pricing).

Multiple providers work in parallel, competing on each transaction. That model makes sense: the category is transactional by nature, the market is liquid, and the system creates genuine efficiency without pretending to build a strategic relationship. That's the difference. It's not about the technology… It's about knowing what you're actually buying.

Technology has a clear role in procurement. It should reduce administrative load, accelerate research, and improve analysis. What it shouldn't do is replace the conversations where real value gets created.

The best commercial outcomes I've seen came from negotiations where both sides had room to move, where the buyer understood the supplier's constraints, and where the relationship was strong enough to have an honest conversation about risk, quality, and price together. No platform replicates that. And no auction captures the value of a supplier who trusts you enough to bring their best ideas to the table.

In procurement, technology should be a bridge between people… Not a
substitute for them.

So here are my eSourcing key takeaways: