S.No.

Model Name

Details The buyer gets to choose the price he wants to buy at. He fixes this price on the portal. As soon as the price of the product matches or goes below this fixed price an automatic transaction takes place. A buyer oriented extra feature can be added where the buyer also gets to set the desirable rate of decrement of the price of the product. If the actual rate is above the specified rate then the automated buying system allows for further fall in price thereby allowing for purchase at an even lower price than specified by the buyer.

The PAV (Protection against Volatility) Model

Sellers with potentially complementary traits can collaborate to offer competitive prices due to lower The Seller Collaboration Model operational cost incurrence. Eg: A seller may have superior inventory facilities while another may have better transportation logistics. Consolidated Buying If there is a simultaneous demand for a product from multiple buyers, the order will be placed by the portal as a collaborative bid. Sellers may bid and rebid with the lowest bid value displayed on the portal. The buyers may submit expected bid prices, till a middle price is reached. An industry has a periodic requirement of some essential raw materials so it commits to buy those raw materials from the seller at a price that they both agree on or can also be determined algorithmically by extrapolating the past trend. The seller proposes an expected price point which may be revised once the seller quotes his own. The price may be calculated using production knowledge (may be proposed by the portal itself). The buyer goes to a particular seller (say Will) and gets the price quotation. He then goes to another seller (say Tom) and then to another seller (say Brad). He now has a fair knowledge of the ongoing market price. Suppose, the buyer finds that Tom has better services but he has quoted a price greater than Brad. He may then approach Tom with a revised price expectation.

Two way bidding

Futures Trading

Informed Price Throw

Multistep buying process

Socialistic Model

All the sellers are registered to the portal for trading. When a buyer wants to buy something the seller is chosen by the portal algorithm such that in a predetermined period of time all the sellers earn equal profits. A seller buys the product from another seller and then sells it to the buyer Sellers submit quotation to fulfill a particular order.

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Pseudo-buyer seller Bidding

Pros

1. Allows the buyer to hedge against potential losses due to volatile market and actually allowing him to extract gains from the volatility. 2. Guarantees purchase at the most logically viable price from an algorithmic point of view.

Sellers may offer highly competitive prices by focusing on core competencies.

A bigger order would call for a lower quotation from the seller (economies of scale)

Open market competition offers best prices for the buyer

1. Assurance of future orders for seller motivates him 2. Guarantees protection to buyers from an inflationary market

The informed price throw actually shows that the buyer has his homework in place and gives him an information incentive in the market.

The model offers best market knowledge and the most informed price point that can be expected.

1) The buyer has to deal with only one seller. Puts an end to rivalry between the sellers

2)

Two sellers are satisfied in one transaction with the buyer. Simplest and quickest way to match sellers and buyers.

Cons

Buyer oriented: The prices are governed by market forces. Automated purchases at low prices can drive the goods' cost further down, demotivating the seller from participating on the portal.

Sellers may not be willing to collaborate with potential competitors.

There may not be a simultaneous demand from multiple buyers.

Visible bidding may lead to fake bids being submitted to artificially drive down the price point.

In an inflationary market, seller may be demotivated to participate in this model.

Involves study of product manufacturing and involved costs to estimate the price throw.

Involves a lengthier process, may not be viable if the buyer is hasty.

The capability of seller to individually earn higher profits is inhibited

The buyer does not get the best price. May not offer the most competitive prices to the buyer.