Industrial Procurement Auctions

As illustrated in the previous chapters, combinatorial auctions have successfully been applied to various application domains, such as the allocation of airspace system resources (Chapter 20), truckload transportation (Chapter 21) and bus routes (Chapter 22). Industrial procurement is potentially a huge application domain for combinatorial auctions, and it has turned into a topic of interest for software vendors and procurement managers in the B2B domain. A number of applications have been reported, but unfortunately, possibly because of efforts to protect proprietary information and competitive advantages, there is little documentation and public information on details of the design of combinatorial auctions in industrial procurement. The focus of this chapter is on describing current practice in this domain. We will also provide a case study of procurement auctions at Mars, Incorporated in order to illustrate the particularities in this field.

[1]  Anthony M. Kwasnica,et al.  A New and Improved Design for Multiobject Iterative Auctions , 2005, Manag. Sci..

[2]  J. Laffont,et al.  A Theory of Incentives in Procurement and Regulation , 1993 .

[3]  Joseph A. Swanson,et al.  Special Issue: Experimental Economics in Practice: The First Use of a Combined-Value Auction for Transportation Services , 2002, Interfaces.

[4]  Paul R. Milgrom,et al.  A theory of auctions and competitive bidding , 1982 .

[5]  Gabriel Y. Weintraub,et al.  A Combinational Auction Improves School Meals in Chile , 2002, Interfaces.

[6]  David C. Parkes,et al.  Achieving Budget-Balance with Vickrey-Based Payment Schemes in Exchanges , 2001, IJCAI.

[7]  Phillip L. Carter,et al.  The Role of Reverse Auctions in Strategic Sourcing , 2003 .

[8]  Daniel F. Spulber,et al.  Managing procurement auctions , 1990 .

[9]  Craig Boutilier,et al.  Eliciting Bid Taker Non-price Preferences in (Combinatorial) Auctions , 2004, AAAI.

[10]  M. Bichler.  The Future of Emarkets: Multi-Dimensional Market Mechanisms , 2001 .

[11]  Michael H. Rothkopf,et al.  Combinatorial Auction Design , 2003, Manag. Sci..

[12]  Martin Bichler,et al.  Winner Determination Algorithms for Electronic Auctions: A Framework Design , 2002, EC-Web.

[13]  Martin Bichler,et al.  Configurable offers and winner determination in multi-attribute auctions , 2005, Eur. J. Oper. Res..

[14]  Andrew J. Davenport,et al.  Price Negotiations for Procurement of Direct Inputs , 2002 .

[15]  Subhash Suri,et al.  Side constraints and non-price attributes in markets , 2006, Games Econ. Behav..