Tender Cum Auction - Basic Concepts

About Tender Cum Auction of NIC Tender Cum Auction is a combination of Tender Followed by Auction (Reverse / Forward Auction). This is normally used to avoid price negotiation with bidders. It is also used as a tool for Price discovery as System offers greater insights into the current market pricing. Also used if there is a competitive market of bidders are anticipated. In the tender document procuring entity has to mention about ‘Auction will be conducted amongst technically qualified bidders after Opening of Financial Bids’. During Auction, the identity of the bidders are not disclosed to either to other bidders or to procuring entity. The participating bidders get an opportunity to reduce their prices in case of Reverse Auction. It allows bidders multiple opportunities to offer a price. In CPPP, Paradip Port Trust, Airport Authority of India, etc are using Tender Cum Auction. Also, Coal India Ltd is extensively using this feature.

Tender Cum Auction Process Flow Reverse (or Forward) Auction will be normally initiated after opening of price bids. There will be no participation fees for Auction. Only such bidders - who have been found techno-commercially qualified as per requirements of the tender will be permitted to participate in the reverse (forward) auction. After opening of the price (financial) bids and System displays L1 (or H1) price (over all or item wise) automatically. This L1 (or H1) price may be auction start price (can be changed by procuring entity, if required). Then, Reverse (Forward) Auction will be created as per requirements and published. Techno-commercially qualified bidders will receive Auction information through SMS & e-mail. No indication will be available in the portal to anybody regarding number of bids and names of the bidders. It is solely at the discretion of bidder to participate in the reverse auction. If a bidder is not interested to participate in the reverse auction, then financial price bid submitted by bidder will be considered as final. Over all bid ranking of each bidder will be generated by system based on financial bid price as well as Auction price.

Enabling of Tender Cum Auction Facility for a Procuring Entity Tender cum Auction facility is to be enabled/configured by Application Administrator for a Procuring Entity. Procuring entity, while creating a Tender, should select Form of Contract as ‘Tender cum Auction’ in the Basic Details page. Note: If ‘Tender Cum Auction’ properties is not enabled, may write a mail to NIC (cppp-nic@nic.in) for enabling Tender cum Auction properties.

Configurable Parameters for Auction Configurable mandatory parameters available for Auction for each procuring entity under ‘Auction management’ are: Forward Auction: A bidder can quote over and above the Starting Price or Current Auction Price. This auction is mostly used by procuring entity to sell items. In Forward Auction, several buyers bid for one seller's goods.   Reverse Auction: A bidder can quote below the Starting Price or Current Auction Price. This auction is mostly used by procuring entity to buy items. In Reverse Auction, several sellers bid for one buyer's order.

Configurable Parameters for Auction Lot /Single Lot: An individual object or group of objects that are similar in nature, offered at auction as a single unit. Multilot: Multiple identical items /objects with varying quality / price / other factors are auctioned and each lot will be conducted in parallel. It is a group of lots. Bidder can participate in any interested lot. It important to upload Multilot Template for conducting Multilot auction. Show- displays ‘Name of Bidder’ along with ‘Price quoted’ during an Auction. Mask- displays ‘Masked ID’ of bidder along with the ‘Price Quoted’ Hide- displays only the ‘Price quoted’

Configurable Parameters for Auction Auction Start Date&Time and Auction End Date&Time:- Live auction would be conducted during this period. Elapse Time in Minutes:- It is the minute(s) before the auction end time and acts as a trigger for auto extension of auction. If a bid is received successfully within this minutes, the auction will be extended.   Auto Extension Time in Minutes:- The Auction End Time will be extended by this ‘Auto Extension Time in Minutes’, If a bid is received successfully within ‘Elapse Time in Minutes. Process will continue till no bid is received in elapse time. Note:- If Auto Extension is not required, in that case Elapse Time as Well as Auto Extension Time should be set as 0 at the time of creation of auction. Ex: Auction End Time is : 6:00 PM, Elapse Time in Minutes is: 5, Auto Extension Time in Minutes is: 10 If a bid is received successfully between 5:55 PM and 6:00 PM (elapse time), then Auction End Time will extended by 10 min (Auto Extension Time) and be revised to 6:10 PM.

Configurable Parameters for Auction Maximum Seal Percentage – It defines maximum value a bidder can quote in multiples of incremental / decremental value. For ex: In Forward Auction   Starting Price Max Seal % Increment Value Quoted Amount Forward 1,00,000 50 1000 In the 1st time Min Quote 1,01,000 Max Quote 1,00,000+50,000+1000 =1,51,000 Quoted Price 1,51,000 In the 2nd time Min quote =1,51,000+1,000 = 1,52,000 =1,51,000+75,500+1,000 =2,27,000 *

Configurable Parameters for Auction Maximum Seal Percentage - For ex: In Reverse Auction   Starting Price Max Seal % Decrement Value Quoted Amount Reverse 1,00,000 50 1,000 In the 1st time Min Quote 99,000 Max Decrement 1,00,000-50,000-1,000 =49,000 Quoted Price 49,000 In the 2nd time 49,000-1,000 =48,000 =49,000-24,500-1000 =23,500 =24,000 *