US government could slash procurement costs by $US4bn a year

A new US report has claimed that the US government could save ‘at least’ $US4 billion a year if federal agencies broadly adopted the use of reverse auctions for the procurement of all commodity buys and simple services.

The study released by the Reverse Auction Research Center argues that the largest potential savings could be achieved by the US Department of Defence, with nearly $US2 billion in potential savings.

A reverse auction is one where sellers, not buyers, compete to obtain business.

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