Reverse Auction Technology powered by Prepared by: Direct 2 Bottomline, LLC How To Take Politics Out of Purchasing As seen on EdwardCTracey.com TV Live.

Reverse Auction Technology powered by Prepared by: Direct2Bottomline, LLC

How To Take Politics Out of PurchasingAs seen on EdwardCTracey.com TV Live

Introducing Industry Best Practices to Government

January 31, 2012


Direct2Bottomline, in conjunction with our technology partner Intesource, helps companies become more

profitable by bringing vendors into a competitive, live bidding environment with the objective of bidding

prices down on the goods, services and capital items they buy.

Value Proposition

Fair Market Fact:As vendors compete, prices go

down!


As the Gwinnett County Board of Commissioners evaluated its options in response to the affects of declining tax revenues and

increasing operating costs vs. service cuts, former Commissioner Kevin Kenerly had this to say:

“… Bold action is needed to keep Gwinnett County a preferred place to live, work, and

raise a family.”

Press Release“Kenerly Issues Call to Restore

County Services”Gwinnett County Board of Commissioners

Lawrenceville, GA Oct. 6, 2009


Boldness Yields Results

Meaning of Boldness in this context: Drastic changes to the status quoWITHOUT becoming wrecklessWITHOUT ignoring corroborationWITHOUT abandoning accountability

Customers have realized more than $2.5B in savings in the past 11 years in tens of thousands of events across hundreds of spend categories


Success

Midwest General Retailer Since 20031 Dedicated ResourceMore than 700 EventsMore than $130 million in Savings


ContrastForward Auction vs. Reverse Auction

Forward Auction

eBay

Reverse AuctionIntesource

Initiator: Seller Buyer

Objective: Highest Bid Lowest Price

Bidders: Anonymous Customer Controlled

Winner: Highest Bidder Customer Controlled

Bidder Presence:

Sporadic Live

Timing: Spans Several Days

Minutes (15-60)


Buyer Control

Contents and Completeness of the RFPVendor participation is by INVITATION

ONLYoIncumbent (s)oPast BiddersoNew vendors identified

Vendor ViewEvent ScheduleAwarding of Contract


Transparency

Online RFP distributionOnline Q&A via the SystemSystem capture of:

oVendor’s acknowledgement/refusal to bidoVendor’s scheduling of any training neededoVendor’s participation in any training

scheduledoEvery aspect of the event itself with

reports and replay capabilityDocument management


Savings Realized Per Event

A “Category” is a good or service, or group of goods or services, which can be bid upon by a common group of vendors.

An “Event” is the execution of a reverse auction for the purpose of bidding a category purchase.


Category Success Factors

1)Good Specifications2)Spend level sufficient to entice

vendors to compete3)At least 2 vendors willing to compete4)Willingness to shake up the vendor

base5)No adverse supply conditions


Item Current Price

Vendor A Vendor B Vendor C

Cost Element 1 $390,000 $360,000 $390,000 $375,000

Cost Element 2 $5,750 $3,750 $5,300 $4,000

Cost Element 3 $9,400 $8,700 $18,900 $9,500

Cost Element 4 $1,400 $900 $450 $900

Cost Element 5 $110,000 $94,000 $107,000 $105,000

Cost Element 6 $8,500 $8,850 $8,810 $8,875

Cost Element 7 $25,000 $30,000 $24,250 $25,000

Cost Element 8 $8,500 $7,250 $9,500 $7,500

Cost Element 9 $210,000 $185,000 $195,000 $175,000

Cost Element 10 $45,000 $57,000 $44,000 $46,000

Cost Element 11 $2,000 $4,000 $2,100 $1,500

Event Screen Depiction


Categories Examples

Communications

Equipment

Office Supplies

Insurance Brokerage

RefuseHauling

Uniforms Fuel Paving Services

Meters

Water TreatmentChemicals

LegalServices

Document/Form

Printing

Payroll Services

BackgroundChecks

DrugScreening

Building Construction

Valves & Pipe

Installation Services

Janitorial Services

Motor Vehicles

Turf Managem

ent


Case StudyDisposable Medical Supply

Category Baseline 9 SKU’s 3 Vendors Annual Spend – $1.551 million

Bids Placed (95 total) Standard event window – 28 Extended event window – 67

Savings First bids - $1.466mm (Savings - $85K+ or

5.5%) Final bids - $1.213mm (Savings - $338K+ or

21.8%)


Beneficiaries

Our Customer’s Enterprise – Lower prices Private - Increased profits Public – Lowered operating costs/revenue requirements

Our Customer’s Buyers Increased Productivity Expanded Vendor Reach

Customer’s Customer Private Enterprise – Potentially lower prices Public – Lowered tax requirements

Vendors New - Exposure to new business opportunities Incumbent – Removal of “best price” doubts Fair treatment during the event – time extensions


What’s Next?

Review of spend categories Execute a series of pilots to test the solution Execute a purchasing calendar for high

potential events of the coming year

No up front costs No people to hire No software to buy No hardware to buy No long term commitment or investment

required


For more information or to discuss the prospects of using reverse auctions to improve your organization’s bottom line – public or private – please contact:

Jim Clark, PresidentDirect2Bottomline970 Peachtree Industrial Blvd., Suite 100Suwanee, GA 30024866-990-3225 (d2bl)770-312-2221Email [email protected] them know you saw it on EdwardCTracey.com website

Reverse Auction Technology powered by Prepared by: Direct 2 Bottomline, LLC How To Take Politics Out of Purchasing As seen on EdwardCTracey.com TV Live.

Documents

reverse auction technology

llc savings

llc contrast forward

llc beneficiaries

llc direct2bottomline

technology partner intesource

event screen depiction

llc category success