Bidding processes vary, depending on an E-market's structure and rules. Some services simply publish RFQs online in a particular category or subcategory, leaving it up to the buyers to find suitable suppliers. Other Web exchanges automatically notify relevant suppliers about a matching RFQ.

No matter how the process unfolds, buyers need to validate bidders before the deal closes. Some E-markets prescreen suppliers to ensure they meet basic identity, solvency, and honesty standards (although it's unclear what legal weight these claims carry). Others take an eBay-like approach to bidders, allowing just about anyone short of Wimpy or Manuel Noriega to participate.

That leaves it up to purchasers to investigate the credentials of bidders—a potentially time-consuming process. "No serious business would allow its procurement team to go to a public marketplace and accept tenders from unqualified suppliers," says Kyte. "The supplier could be a criminal organization, a massive polluter, or one that exploits child labor."

To ease the due-diligence burden—and to boost purchasing power—some E-market users join together to aggregate their requirements for specific products or services. Says Richard Goch, manager (strategic sourcing) for PPL Corp., an electric-and-gas energy company in Allentown, Pa.: "Group contracts and online auctions have been effective approaches to purchasing desktop and laptop computers as well as some peripherals."

But one IT consultant warns businesses not to get too carried away by the power of aggregate auctions. Why? Companies that engage in the practice, he says, could find themselves on the wrong side of an antitrust suit. "If a few small buyers get together to pool power, that's not an issue," the consultant explains. "But the more pooling of buying power that arises, the more coercive this becomes and, therefore, the more antitrust issues might come to the fore."

Whether electronic exchanges will be able to find a niche in supplier-to-bidder sales remains to be seen. The remaining players, including Gordon and Zales, are predictably optimistic. Gartner's Kyte, however, believes that E-markets are "a phenomenon that died four years ago." And Bartels thinks the future of online procurement may lie in bids that are submitted directly to company Websites and portals.

But don't tell any of this to Mroz, who is already planning on posting his next solicitation for bids. "I think it's a pretty slick way of doing business," he says.

John Edwards is a freelance writer based in Gilbert, Ariz.

Auction Bridge
These online exchanges enable companies to connect with—and solicit bids from—suppliers and contractors.

BuyerZone.com (www.buyerzone.com)
Online bidding system for dozens of categories, ranging from office equipment to financing; SMBs a specialty.

Enporion (www.enporion.com)
E-market for energy industry buyers and suppliers.

eWork Markets (www.ework.com)
Focuses on services; companies solicit bids from business consultants, engineers, marketers and the like.

Quadrem (www.quadrem.com)
Buyers launch, receive, and analyze bids on various types of products and services for the mining industry.

SupplyOn (www.supplyon.com)
Online service for European automotive suppliers hosts live or long-term online-bidding sessions that follow buyer-set rules and procedures.

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