Auction procurement: a new trend? Foreign firms are bringing savings to Japan via auctions

Japan, Inc., July, 2004 by John Dodd

According to Blaise Anthony, the average savings for the Chanel project were in the order of 20 to 40 percent. However, "it varies depending on the product and/or service you're dealing with. For instance, on furniture and some higher ticket items, we were able to save up to 44 percent, and in several cases, I have been able to extract savings of up to 75 percent from the list price."

Our GE source agreed with this, using the example of a surprising 50 percent savings on floppy disks bought by auction. Clearly, the impact of auction-based procurement on the bottom line can be significant, particularly for the average foreign multinational.

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