Competition is only a click away on the internet. Auctions boost market transparency, since buyers can compare suppliers‘ prices at a glance. Smart customers are increasingly using this buying option. 
How does METRO Group use Online Negotiations?
In 2000, the purchasing unit METRO Group Buying GmbH initiated the kickoff for goods auctions. The retailing group processed 1,455 million euros of its total procurement volume of 46 billion euros using the virtual marketplace in 2004 and the trend is clearly up. Meanwhile, almost all METRO Group companies use auctions to purchase goods. The system complements the traditional method of negotiation for goods and services.
Purchasing Volume is Growing Progressively
Generally any buyer in charge can start an auction from his or her PC. Using online auctions is not limited to so-called Central Buyers at MGB who are responsible for group-wide purchasing. Local buyers in sales divisions and cross companies also negotiate online. Furthermore, the online negotiations are not only used for purchasing goods, the procurement of capital goods and services is also possible. The range of products purchased using online auctions stretches from long-life milk to complex financial services.
Knowing what Suppliers can do
METRO Group does not understand the online negotiation platform as a supplier sourcing tool: The platform does not independently seek out suppliers who cover a specific demand. The group negotiates only with those suppliers via virtual marketplace who have been specifically invited to the auction. Price inquiries and requests for information, such as in the case of new products, can be integrated into the course of a tender. In order to make sure that one is comparing "apples to apples" the buyer precisely defines characteristics of the products. If required, the buyer will ask for samples in order to determine suppliers‘ quality standards.
