The impact of transparency and competition on electronic reverse auctions

Since the Internet usage boom in 1990 electronic reverse auctions became an important procurement tool within private and public sector. We concentrated on the impact of transparency on efficiency of electronic reverse auctions. To prove the efficiency of costs of electronic reverse auctions we analysed empirical data. On the base of electronic purchases from certain Slovak company results show that increasing transparency in a certain way can lead to a lower purchasing price and therefore higher savings for a buyer. We also analysed the influence of number of participants on savings. We found out that increasing competition does not always lead to higher savings and it is important to define optimal number of suppliers for securing the most efficient purchasing price.