One of the biggest British banking groups, The Royal Bank of Scotland, used Electool’s online auction software Fluenta Auction (former AuctionTool) for its sourcing projects in Russia. The financial institution started expanding into the Russian market with the acquisition of another foreign network. of.
The group anticipated a decline in revenue based on events effecting the global banking market and increasing risk of lending. The group decided to employ cost optimization methods. They entrusted our Russian business partner to review their sourcing process, analyze their activities and invite its major suppliers to tender. The straightforward expectation of our client was to reduce costs and increase efficiency. We successfully fulfilled this expectation.
The British banking group’s choice to use Fluenta Auction was was knowing this technology drives stronger competition between potential suppliers than traditional procurement negotiations. They realized the benefits of online auctioning where suppliers compete to establish a fair market price and win a given deal, and not bilaterally negotiated. This pricing method is generally based on cost calculation on supplier side, which is rarely accessible for the buyer.
Another important principle was to manage the company’s procurements in a transparent and traceable way. Fluenta Auction fully met their requirements. The banking group achieved significant savings at their first online auction and suppliers welcomed the relevant changes in the process.