Employee Benefits Reverse Auction

About the Program

Category: Financial Management (Best in Category)

Year: 2013

Maricopa County Office of Procurement Services introduced the use of a Reverse Auction program in late 2008. Reverse Auctions allow multiple suppliers to openly bid against one another electronically in an attempt to achieve the most competitive prices from competing vendors. Through Reverse Auctions suppliers are allowed to see each other's current bid and prices decrease over time as vendors compete to win the business. Early success was achieved using Reverse Auctions for several commodity items such as: all-purpose flour, inmate shoes, canned fruit, and peanut butter. From the various commodities that were purchased through Reverse Auctions, Maricopa County has experienced a cost savings in excess of $2,000,000. Over the past few years the program has evolved and the County had developed new uses for Reverse Auctions that have resulted in savings which reach into the millions of dollars. Since the County has not provided salary increases over the past five years, Maricopa County is currently focused on employee retention through providing benefits to its employees at the lowest possible cost. With this thinking in mind, the Office of Procurement Services has been able to modify and implement Reverse Auctions for use in our employee health benefit solicitations. The use of Reverse Auctions for Pre-Paid Dental Insurance and Employee Term Life Insurance resulted in almost $7 million dollars in savings for the County and its Employees.