Hammer comes down on £440k e-auction savings

OLDHAM Council has made savings of nearly half-a-million pounds after signing up to e-auctions for the first time.

The auctions — often called reverse auctions or procurement auctions — allow suppliers to bid against each other online to win contracts.

This can often result in considerable savings on existing contracts.

In 2010, the council carried out five e-auctions over a three-month period and made savings of £440,000 over the lifetime of five contracts.

Two of these are one-year contracts and the three others will run for four years.

Councillor Lynne Thompson, Cabinet member for performance and value for public mone,y said: “The cost of staging the e-auctions was £15,000 but the savings we have made as a result have made this relatively small investment an impressive one.

“Finding innovative methods to save money, especially in these challenging times, is particularly important. These e-auctions have been very effective and we plan to stage more in the future.”

The first of the e-auctions was held for suppliers tendering to provide IT equipment for The Radclyffe School in Chadderton.

Following this, the council held a second auction for IT equipment.

The savings made on the two e-auctions amounted to £320,000 over the four-year life of the contract — a saving of 20 per cent.

Two e-auctions were then held for the supply of taxi services — both general and for social care clients — over a one-year contract.

Savings amounted to £60,000, beating the previous contract costs by 17 per cent.

A fifth e-auction was staged to supply road marking on a four-year contract.

The successful supplier tendered at 15 per cent below the previous contract price, making total savings over the contract of £60,000.