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Negotiation options in Oracle sourcing and Oracle exchange


Pricing in Negotiations - Auction, Offer, RFQ in Oracle Sourcing and Oracle Exchange
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The Negotiations functionality is available in Oracle Sourcing for an
organization to create buyers' auctions, offers to buy, and requests for
quotation (RFQs) and Request for Information (RFI).

Oracle Exchange has Negotiations functionality available in the "Marketplace
Selling" for creating sellers' auctions, offers to sell, and quotations, and in
the "Marketplace Buying" application for creating buyers' auctions, offers to
buy, and requests for quotation (RFQs).

Negotiations allow buyers and sellers to obtain the best possible
price for goods and services.

Negotiations

There are three negotiations document types depending on a buyer's or seller's
transaction requirements.

Summary of Negotiations Types
-----------------------------
       Auctions                            RFQs                                         Offers(RFI)

Characteristics
---------------
Allow auctioneers to solicit             Allow buyers to collect                    Used for near-commodity
bids for goods and services             quotations from suppliers for          items that may have multiple
that are clearly defined -                for complex and hard-to-define      item attributes that are easy to
example,office furniture                 items or services -for                      define and understand -basic
and memory chips.                         example, made-to-order                  chemicals,for example, where
                                                        manufacturing or construction        there is no product
                                                        projects. Once suppliers have          differentiation and price
                                                        submitted an initial round of           changes are mostly influenced
                                                        proposals, buyers have the               by supply and demand.
                                                        power to fine-tune their                     Suppliers or buyers either
                                                        request and initiate detailed               counter an offer to negotiate
                                                        negotiations,as necessary.                This the price (counteroffer) or
                                                    process may go through                                    agree to meet an offer  
                                                    multiple rounds of                                             (commitment). An offer closes                             
                                                    negotiations and quotations.                              when a commitment is made,
                                                                                                                               even if the date and time have
                                                                                                                                not arrived.

Initiated By  
------------
Buyers and sellers.                       Buyers only.                                                       Buyers and sellers.

Response Document      
-----------------
A response to an auction is               A response to an RFQ is called                         A response to an offer is called
called a bid.                                        a quotation.                                                      a counteroffer.

Types         
-----
Buyer's (or Reverse)                              RFQs are created by buyers                           Offers to Buy and Offers to
Auctions and Seller's (or                     only.                                                            Sell.
Forward)Auctions.

Styles        
------
Open,blind,or sealed.                           Blind or sealed.                                            Offers are always blind.

Multiple Rounds Supported?
--------------------------
Auctioneers can choose                      RFQs can lead to multiple                                Counteroffers serve as
whether to allow multiple                  rounds of negotiating.                                        multiple rounds of negotiating
rounds of bidding.                                                                                                         until a commitment is made.

Can Include Multiple Items?
---------------------------
Yes.                                                        Yes.                                                               Each offer can only include a
                                                                                                                                     single item.
                          


. There are three auction styles (Open,Blind,and Sealed) and two RFQ styles
  (Blind and Sealed). Offers are always Blind.
   . Open: In an open auction,all Exchange members participating in the
     auction can see the bids in the auction, though the bidder identity is
     concealed. Since bidders can see the behavior and strategy of other bids
     in real time, open auctions can encourage competition among bidders to
     submit the best possible price.
   . Blind: In a blind auction or RFQ, only the creator of the auction or RFQ can
     see the bids.
   . Sealed: In a sealed auction or RFQ,the auction or RFQ creator cannot see
     the bids or quotations until the auction or RFQ is unlocked. The
     participants in the auction or RFQ cannot see the bids or quotations until
     the auction or RFQ is unsealed. For example, sealing an auction or RFQ
     from the creator prevents preferential treatment to preferred bidders.

. A guided online process enables easy creation of auctions, RFQs, and offers.
. Templates, reusable attributes lists, reusable invitation lists, and item uploads
  allow negotiation owners to streamline the auction, RFQ, and offer creation
  process.
. The application enables the copying of existing auctions to create new auctions,
  existing RFQs to create new RFQs, and existing offers to create new offers.
. In Oracle Exchange Negotiations are also accessible through the "Marketplace
  Purchasing", "Transportation", "Product Development", and "Supply Chain Exchange"
  applications. For example, while adding items to your shopping cart, a buyer
  can click an "Add to Negotiation" button to create a negotiation for the items
  instead of an order.

Detailing Your Negotiation

Negotiation owners have the following options:
. Create a Negotiation Event. A Negotiation Event is several related negotiations
  grouped together, enabling the creator to monitor related negotiations as a
  group. For example, a Negotiation Event encourages bidders to participate in
  multiple, similar auctions.
. Set the auction, RFQ, or offer to accept bids in multiple currencies.
. Specify and negotiate business terms and conditions on the auction, RFQ, or
  offer.
. Specify many items on a single auction or RFQ - over 3,000 lines via spreadsheet
  item upload.
. Use response attributes to define the details that a participant should provide
  when responding to an item in an auction, RFQ, or offer. For example, when an
  auctioneer adds an item to an auction for vehicles, the auctioneer can add a bid
  attribute called "mileage" to specify that the bid item must have fewer than
  12,000 miles on the odometer. The Exchange Operator or Exchange Company
  Administrator can also create Exchange-wide or company-wide negotiation
  attribute lists for repeated use.
. Define response rules for negotiations:
  . Autoextension rules. To encourage competitive bidding, auctioneers can set
    an auction to automatically extend by a specified period (for example,20
    minutes) if a bid is received during the final minutes (in this example,20
    minutes before the close)of the auction. Auctioneers can also set the
    number of AutoExtensions that can occur.
  . Partial quantity responses. Allowing partial quantity responses means the
    participant can submit a response for a quantity less than the quantity
    specified in the auction, RFQ, or offer.
  . Response to selected items. Negotiation owners can choose whether the
    respondent can respond to some of the items in the auction or RFQ instead
    of all of the items.
  . Re-bidding,or one best bid.Auctioneers can use bid controls to allow
    rebidding in auctions.If rebidding is not allowed,the bidder must submit
    the most competitive (one best)bid in the first attempt;if another bidder
    out-bids him,the bidder does not have an opportunity to go lower.
  . Minimum decrement or increment.Auctioneers can specify minimum rates
    or amounts of change between bids from a bidder.
. Create invitations to participate in negotiations, including companies not
  registered on the Exchange. Individual negotiation owners can create reusable
  invitation lists, and the Exchange Company Administrator can create
  company-wide reusable invitation lists. (Invitation lists can include only
  registered Exchange companies.)
. Specify notes and attachments at the negotiation or item level.

Responding to a Negotiation (Placing a Bid,Quotation,or Counteroffer)

. Participants can respond to auctions, RFQs, and offers online.They can also
  respond to auctions or RFQs using a downloadable spreadsheet.
. Proxy bidding allows the Exchange to automatically rebid on the bidder's
  behalf whenever a competing bid price beats the bidder's bid price within a set
  limit.
. Power bidding allows bidders to streamline their rebidding when they have bid
  on several items in the same auction.Using power bidding,all of a bidder's
  bids (both losing and winning bids) in an auction will be improved by the
  percentage the bidder enters in the "Power Bid" field.
. If permitted by the auctioneer, bidders can rebid or create multiple bids for
  auctions.
. Participants can specify notes and attachments with their responses at the
  negotiation or item level.
. Multiple rounds of negotiating can occur.
. Once the negotiation is completed, participants are immediately notified of the
  results through online notifications.

Monitoring Negotiations

Everyone - negotiation owners and respondents - can monitor the status of
negotiations online in real time:
. Bidders can choose whether to monitor auctions using the AutoRefresh page.
  On the Aut Refresh page,a drop-down menu enables the bidder to select the
  interval (every 30 seconds,60 seconds,and so on)for the page to refresh.
. The application provides graphs to monitor auctions and RFQs.

Updating the Negotiation

Negotiation owners can update the negotiation:
. Manually extend the negotiation by changing the close date and time or
  changing the AutoExtend setting.
. Close the negotiation by bringing the close date and time forward.
. Cancel the negotiation.
. Disqualify a bid or quotation.

Awarding the Negotiation

Awarding the negotiation includes the following options:
. Comparing bids and quotations.
. Awarding the negotiation online.
. Awarding the negotiation offline by downloading and reuploading a
  spreadsheet.
. Creating a standard or blanket purchase order XML document directly from a
  buyer's auction or RFQ. A standard purchase order is the outcome of a spot
  buy, buyer auction or RFQ. A blanket purchase order is the outcome of a
  long-term buyer auction or RFQ.


Enterprises with Oracle Sourcing and Oracle Purchasing Licenses

Oracle Sourcing is tightly integrated with the procurement modules of the
E-Business Suite. Enterprises with both Oracle Sourcing and Oracle Purchasing
licenses can fully leverage their investment in Oracle Purchasing while ensuring
consistency and data integrity.

Buyers can aggregate requisition demand and create new sourcing documents
directly from Oracle Purchasing. Once buyers have made their award decisions,
they can create standard purchase orders or blanket purchase agreements directly in
Oracle Purchasing, completing the sourcing cycle. Oracle Sourcing leverages
reference data already maintained in Oracle Purchasing, including operating units,
ship-to and bill-to locations, currencies and exchange rates, payment terms, and
suppliers.

Buyers have visibility to information throughout the complete procurement process.
Oracle Sourcing buyers can drill down from a sourcing document to the requisition
lines that originated the sourcing event. Oracle Purchasing users can identify the
negotiations that initiated the standard purchase order or the blanket purchase
agreement. Likewise, requisitioners in Internet Procurement can track the
negotiation in which their requisitions are being negotiated. Suppliers accessing
Oracle iSupplier Portal can drill down from a purchase order to the backing
sourcing document and quotation in Oracle Sourcing.

Buyers in Oracle Purchasing can select and aggregate approved requisition lines in
the AutoCreate Buyer's Workbench to create draft Buyer's Auctions or Sourcing
RFQs. Buyers can then automatically launch Oracle Sourcing to continue creating
the sourcing document and conduct negotiations with suppliers. Upon completion
of the sourcing event, Oracle Sourcing creates new standard purchase orders or
blanket purchase agreements in Oracle Purchasing. The requisition lines that
originated the negotiation are linked to the newly created purchasing document.
Buyers in Oracle Sourcing can also create or update sourcing rules in Oracle
Purchasing to automate future releases against agreements.
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Comments

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