Getting Started

Getting Started with Negotiations

Using Oracle Sourcing

Frequently Asked Questions: Oracle Sourcing

Getting started with RFQs

Getting started with auctions

Using Oracle Sourcing

If you are a Sourcing Buyer, see Getting Started for Buyers.

If you are a Sourcing Supplier, see Getting Started for Suppliers.

If you are responsible for administering the Sourcing system, see Getting Started for the Sourcing Super User.

Getting Started for Buyers

As a Sourcing Buyer you have access to a wide range functionality with Oracle Sourcing. You can create a request for information (RFIs), request for quotations (RFQs), and Buyer's Auction. If your system is integrated with Oracle Purchasing, you can also use requisition information contained in Oracle Purchasing to create draft RFQs and auctions which you can then complete and submit using Oracle Sourcing. You can monitor your negotiations in real time and communicate with participants using online discussions.

Getting Started for Suppliers

Oracle Sourcing Suppliers can use the product functionality to quickly locate and respond to negotiations. Sourcing Buyers (along with the Sourcing Super User), can invite you to register with the system. Once you receive a registration invitation and have registered and been approved, you can start participating in negotiations.

Getting Started for the Sourcing Super User

If you are the Oracle Sourcing Super User, you are responsible for setting up and maintaining your company's system. Many setup tasks were probably performed during implementation, however you may wish to do any of the following:

See the Oracle Sourcing Administration and Maintenance Guide for details on how to perform these tasks.

Getting Started for the Sourcing Collaborator

As a Sourcing Collaborator, you must have Oracle Sourcing, or Oracle Procurement Contracts licensed, and ready to use. The Sourcing Collaborator responsibility enables you to work with the Sourcing team to contribute to negotiation creation, quote review, and awarding. Your responsibility enables you to perform all tasks as a Sourcing buyer, except that you cannot create new negotiations (RFI, RFQ, or Auction): either from scratch, or by copying an existing negotiation.

Frequently Asked Questions: Oracle Sourcing

What is Oracle Sourcing?

Negotiation Types

Negotiation Styles

Start Price and Target Price

Using Shortcuts to Create a Sourcing Document

Using the Spreadsheet Functionality

Responding to the Same Negotiation

Changing the Close Date of a Published Negotiation

Retracting a Response

Initiating a New Round of Responses

Creating an Attribute Based Negotiation

Awarding Business to Bids or Quotes from the Previous Round When a New Draft Exists

Understanding Auction or RFQ Item Numbers

Canceling a Negotiation with Backing Requisitions in PO

Working with Multi-Attribute Scoring

Accepting Negotiation Responses in Multiple Currencies

Inviting Companies to Participate in a Negotiation

Receiving Notifications

Receiving Reminder E-mail Notifications

Acknowledging Intent to Participate Before Submitting Responses

Responding to a Negotiation that your company owns

Inviting Additional Suppliers to an Auction or RFQ

Checking Created Purchase Orders after Completing Auction or RFQ

Using Supplier Incentives

What is Oracle Sourcing

Getting Started with Oracle Sourcing

Oracle Sourcing offers flexible negotiation capabilities to buyers and sellers, enabling them to efficiently obtain the best possible prices for goods and services. Prices are established based on actual supply and demand at the time the negotiation is transacted.

The four different types of sourcing documents available - requests for quotations (RFQs), requests for information (RFIs), and buyer's auctions. Buyers use real-time interaction to obtain information on suppliers' products and services, and then use that information to create negotiations that drive prices based not only on price, but on lead times, quantity, and item-specific attributes. Buyers and sellers, who might never meet face-to-face, can bypass intermediaries and establish relationships that might not have been possible using more traditional methods of buying and selling.

Common Functionality

All sourcing document types have the following common functionality to simplify the negotiation creation process:

RFIs

Oracle Sourcing allows buyers to qualify a wide group of suppliers and their products and services using RFIs. Buyers can use the information obtained to subsequently conduct an RFQ or buyer's auction.

RFQs

Negotiations supports the full RFQ business process. RFQs enable buyers to request quotes from suppliers for complex and hard-to-define items or services such as make-to-order manufacturing items or construction projects.

Learn more about RFQs.

Auctions

Auctions supports the complete auction process from auction creation to final award to purchase order generation. Auctions enable buyers to solicit bids for goods and services that are clearly defined, such as office furniture or memory chips.

Learn more about auctions.

Use the following table to determine which type of negotiation best suits your business needs. These recommendations should only be used as guidelines. Your specific needs may dictate that you use a negotiation type that has not been specifically recommended for the scenarios listed below.

Guidelines for choosing a negotiation type

Description of your goods and services Buyer's Auction RFQ
Easily definable item with few attributes Y -
Complex item with many attributes - Y
High number of responses expected in a short time Y -
Other decision criteria - -
All participants in the negotiation should be able to view competitive responses but not the responder's identity.(Open Style) Y -
Only buyer should be able to see the responses(Closed Style) - Y
ON one can view the responses until the buyer unlocks and unseals them(Sealed Style) Y Y
Closing time should be modifiable AutoExtendManual Extend/Close Early Manual Extend/Close Early
Should be able to monitor and alanyze responses online Graphical MonitorBid CompareBid History Graphical MonitorQuote CompareQuote History

Negotiation Types

The four types of negotiations are Requests for Information (RFIs), Requests for Quotes (RFQs), and auctions. See the table below to help you determine which type of negotiation to create.

Comparison of the negotiation types:

Negotiation Type RFI RFQ Auction
Characteristics RFIs allow buyers to solicit information from suppliers on the goods and services the suppliers provide. This allows buyers to qualify a group of suppliers and identify the suppliers to be included later in the negotiation RFQs allow buyers to collect quotes from suppliers for complex items and services. Suppliers submit a single quote per round. Buyers review the quotes, may amend the supplier list, and submit the RFQ for subsequent rounds of negotiating. The RFQ process is typically longer than an auction. Auctions allow buyers to solicit bids for items and services that are clearly defined, for example, office furniture and memory chips. Auctions are usually short in duration and require a fast bidding process leading to a quick award.
Response Document Response Quote Bid
Style(s) Open, Blind, Sealed Blind, Sealed Open, Blind, Sealed
Multiple Rounds Supported(?) Yes YesRFQ,s by nature usually lead to multiple rounds. Yes, if enabled through bid controls.
Can Include Multiple Items? Yes Yes Yes
Other

Negotiation Styles

The buyer can choose from three types of negotiations:

Start Price and Target Price

When creating a new RFQ or auction, you can optionally set a start price and target price for every line in the negotiation. The start price is the maximum price you are willing to pay for one unit of item. The target price is the price you hope to pay for one unit of an item. You can elect to display the target price to participants. If you specify a start price, all responding must begin at that price or lower. If suppliers respond with a price higher than the start, they receive an error message.

Using Shortcuts to Create a Sourcing Document

There are many ways you can streamline the creation of sourcing documents:

Copying an existing document You can copy documents that you, or any other users in your organization, have previously created. The details of the document such as the controls, terms and conditions, item information, and invitation list are copied into a new document which you can edit if necessary.

Using document templates If many of the negotiations you create contain the same features, you may want to create a template that you can use each time you create a sourcing document. This allows you to standardize business practices and save time. Your template will contain the features that are similar among the negotiations you commonly create. When you create a document using a template, you simply open the template and add to or edit details of the template as necessary.

If you are assigned the Manage Sourcing Document Templates job function, you can also create and manage public templates in addition to your private ones. The public document templates will be available for every Sourcing buyer at your company.

Using negotiation styles Your Sourcing Administrator can define document styles that become available for use by buyers. A negotiation style can exclude certain Oracle Sourcing features. For example, a style could be defined that does not allow the use of Requirements or attributes. Once a feature has been removed, the associated regions and fields do not appear on the product pages thus streamlining the appearance.

Using Reusable Attribute Lists

Attribute lists can streamline the document creation process while providing standardization for negotiation items. If you are assigned the Manage Attribute List job function, you can create attribute lists for use by all Sourcing buyers at your company. An attribute list is a grouping of attributes that are commonly used together to describe a good or service.

Using Reusable Invitation Lists

You can create Reusable Invitation Lists containing names of suppliers who you frequently invite to your negotiations. Invitation lists can be shared across the company. This can help you standardize your business practice as well as speed up the negotiation creation process.

If you are assigned the Manage Invitation List job function, you can create and manage public Reusable Attribute Lists, in addition to your private ones. The public lists will be available for Sourcing buyers at your company.

Using spreadsheets

You can download and use spreadsheets to efficiently create and award RFQs and auctions having many line items.

Using draft RFQs/auctions

You can create and save an auction intending to submit it later. These draft documents also allow multiple collaborators to work on the same document.

Creating RFQs/auctions using Autocreate

If your company has licensed both Oracle Purchasing and Oracle Sourcing, you can use the Autocreate feature of Oracle Purchasing to select and group requisitions to create draft RFQs or auctions.

Using the Spreadsheet Functionality

Getting Started with Oracle Sourcing

Both buyers and suppliers can utilize the spreadsheet functionality to save time when creating or Quoting/Bidding on multi-line item negotiations. Buyers can efficiently create and award RFQs and auctions while suppliers can also use this functionality to assist in bidding in auctions or submitting quotes for RFQs.

Responding to the Same Negotiation

Getting Started with Oracle Sourcing

. All registered users in a company can bid on the same auction, provided that:

  1. The negotiation to which they are responding is not owned by their company

  2. The bid controls for this auction allow multiple bids per round. If only one response per company is allowed, that is called the Single Best Bid.

  3. They have the appropriate function security..

Depending on the auction style, the bidders will be able to see different information as shown below:

Auction Style Other Bidder's Viewable Information
Open Company Name
Time of bid
Bid details
Any Notes and Attachments (if notes and attachments are viewable for auction)
Blind Company Name
Time of bid
Sealed/Locked Company Name
Time of bid
Sealed/Unlocked or Sealed/Unsealed Company Name
Time of bid
Bid details
Any Notes and Attachments (if notes and attachments are viewable for auction)

Note:Two people from the same cannot quote in the same RFQ.

Changing the Close Date of a Published Negotiation

If you set the response controls appropriately, you can manually close a negotiation before its published close time. Also, you can manually extend a negotiation or allow AutoExtend to automatically trigger one or more extensions.

Additionally, you can pause and resume a negotiation for a short period of time if you need to clarify supplier questions.

Retracting a Response

Getting Started with Oracle Sourcing

If a supplier has submitted a response, the supplier can contact the buyer and ask to have the response disqualified. Disqualification, however, is up to the discretion of the buyer.

Creating an Attribute Based Negotiation

Getting Started with Oracle Sourcing

Attribute based negotiations enable buyers to define multiple item-specific characteristics, called item attributes, that allow bidders/suppliers not only to respond to the price, quantity, and delivery, but also to other features salient to each item. Depending on the setting chosen during the negotiation creation, these attributes can be either required, optional, or display only.

Item attributes and their responses comprise the heart of the RFI process. When creating an RFI, buyers define attributes for negotiation items. These attributes represent important aspects of the item for which the buyers need information from their suppliers. Suppliers reply to the item attribute, in essence "answering" the buyer's question. The buyer then uses the suppliers' responses to qualify the group of suppliers and to determine the best set of suppliers with which to later conduct a negotiation.

Awarding Business to Bids or Quotes from the Previous Round When a New Draft Exists

Getting Started with Oracle Sourcing

Once you save a new round of Quoting/Bidding, the system automatically updates the status of the previous round to Round Completed. Negotiations with Round Completed are not available for awarding.

However, you can delete the draft for the new round from the Manage Draft Negotiations page. The system automatically updates the status of the previous round to Closed, making it available for award.

Understanding Auction or RFQ Item Numbers

Getting Started with Oracle Sourcing

Item numbers and item revisions appear if the negotiation item is AutoCreated from a requisition line having an item from the item master. Negotiations lines entered directly in Oracle Sourcing can include item numbers and item revisions if the item information was retrieved from the Item Master.

Canceling a Negotiation with Backing Requisitions in PO

Getting Started with Oracle Sourcing

As soon as you cancel a negotiation with backing requisitions, the requisitions become available again to AutoCreate in Oracle Purchasing. New buyers can then manage the requisitions as needed. The old Sourcing negotiation number remains on the requisition line until a buyer creates a new negotiation using the requisition.

Working with Multi-Attribute Scoring

In a price-only negotiation, suppliers can quote/bid on price, quantity, delivery dates and attributes of an item, however, the system ranks the supplier only on the basis of price. In a Multi-Attribute Weighted Scoring negotiation, item attributes can be scored and weighted. The winning response is decided based on the buyer's definitions of the relative importance of item attributes, reflected in the Price-to-Total-Score.

In both price-only and Multi-Attribute Weighted Scoring negotiation, the buyer can still award the negotiation to any supplier regardless of the Price to Total Score ratio values.

Multi-Attribute Weighted Scoring is the ability for a buyer to use customizable attributes to define a product or service in a quantifiable manner. This allows the buyer to define the relative importance of each attribute by assigning weights to these attributes and scores to expected values for each attribute.

Each weight assigned to an item attribute is a number between one and 100 that represents the importance of that attribute compared to other item attributes. The higher the weight, the more important the attribute to the item.

Scores are numbers between zero and 100 and are assigned to each possible attribute value or range of values. The higher the score, the more desirable the attribute value or range of values. Scores represent the desirability of that attribute value or range of values compared to other values. The goal of scoring is to motivate a respondent to respond with quotes/bids most closely matching the desired attribute values.

Weights and scores can be assigned to the custom attributes, quantity, or need-by date. Custom attributes having weights and scores are called weighted attributes and require a response. As responses are received, the system calculates a weighted score for each attribute response and a Total Score for the item. It then ranks the scores for the same item from different respondents based on a Price to Total Score ratio.

Accepting Negotiation Responses in Multiple Currencies

When you create a new negotiation, the negotiation currency defaults to the ledger currency defined for your operating unit. However, you can allow bids or quotes in currencies other than the negotiation currency. Whenever you view the responses you have received, the system will automatically convert the responses to the negotiation currency.

Though suppliers in a multi-currency negotiation can submit responses in several currencies, they are allowed to respond in only one currency per response.

Inviting Companies to Participate in a Negotiation

You can invite suppliers to participate in your negotiation by selecting them from the Supplier Master or by applying predefined invitation lists. Invitations are automatically sent to each supplier.

For a public negotiation, you are not required to send invitations to any suppliers. However, you might want to send invitations to increase specific suppliers' awareness of your negotiation and encourage participation.

If the supplier (or a supplier contact) has created a group email list that includes all the individuals who should receive the negotiation notifications, you can enter the address in the Additional Contact Email field during negotiation creation.

Receiving Notifications

Notifications are used to communicate specific events to users.

Event Recipient Purpose
Preview or open date/time Buyers To inform them that the negotiation is open for previewing or bidding
Preview or open date/time All invited suppliers To invite them to acknowledge intent, and participate in the negotiation
Preview or open date/time All invited additional contacts To invite them to acknowledge intent, and participate in the negotiation
Early close of an RFQ or auction All invitees and suppliers To inform them about the newly updated close time
Extend close date/time of an RFQ or auction All invitees and suppliers To inform them about the newly extended close date/time
Disqualify a bid or quote Supplier whose response has been disqualified To inform the supplier the bid has been disqualified
Disqualify a bid or quote All bidders in the open or sealed auction, or all suppliers in the sealed RFQ To inform all bidders/suppliers that a certain quote/bid has been disqualified
Cancel a negotiation All invitees and suppliers To inform them the negotiation has been canceled
Award and RFQ or auction All suppliers To notify the suppliers that the RFQ or auction has been awarded and how many lines have been accepted or rejected
Starting a new round in an RFQ or auction Suppliers who are invited for the new round To invite them to participate in an additional round of negotiation
Starting a new round in an RFQ or auction All suppliers from the previous round who are not invited to the new round To notify them that they are not invited for the additional round of negotiation
Invitee not acknowledging intent within the allowed time Supplier who hasn't responded To inform and encourage invitee to acknowledge intent to participate

Receiving Reminder E-mail Notifications

If companies do not acknowledge participation by a certain time, they receive a reminder email notification once the negotiation has opened for either previewing or responding. When the reminder gets sent depends on the duration of the negotiation. The negotiation duration is the length of time between either the preview date (if the buyer specified one) or the open date, and the close date.

Negotiation Duration Reminder Email Sent
Equal to or less that 24 hours One hour after the preview/open date
More than 24 hours but less than one week One day after the preview/open date
Equal to or longer than one week Three days after the preview/open date

Notes:

Acknowledging Intent to Participate Before Submitting Responses

Getting Started with Oracle Sourcing

Suppliers are encouraged to acknowledge their participation intention after they receive the invitation email. Such acknowledgments are intended to enhance communication between buyers and suppliers and inform buyers of the potential participation. It is not mandatory to acknowledge your intent before submitting responses.

Responding to a Negotiation that your company owns

You cannot respond to any negotiation that your company owns.

Inviting Additional Suppliers to an Auction or RFQ

Any user assigned the appropriate job function canadd suppliers to an RFQ or auctionany time before the close date and time.

Checking Created Purchase Orders after Completing Auction or RFQ

There are various ways to check which purchase orders were created.

Getting Started with RFQs

RFQs supports the full business process to solicit quotes from suppliers. The suppliers' responses to the RFQ allow the buyer to compare quotes and negotiate the best price and specifications for the good or service. RFQs enable buyers to collect quotes from suppliers for complex and hard-to-define items or services. Once suppliers have submitted an initial round of quotes, buyers can review quotes and award the RFQ or submit a modified RFQ for another round of quoting.

Steps in the RFQ process include:

  1. RFQ creation Buyers initiate RFQs that may include multiple line items by publishing the RFQ and inviting suppliers.

  2. Quote preparation and submission Suppliers view the RFQ details and submit their quotes online.

  3. RFQ monitoring Buyers can monitor real-time quote activity and take appropriate action.

  4. RFQ modification or awarding Buyers analyze the quotes and either award the RFQs or modify the RFQs and open them for another round of quoting. Once the RFQ is completed, suppliers are immediately notified of the results via online notifications.

RFQ Capabilities

Getting Started with Auctions

Auctions offers complete, flexible auction capabilities to buyers so they can efficiently obtain the best possible price for goods and services. Prices are established based on actual supply and demand at the time the auction is transacted. Auctions allow real-time interaction to drive dynamic prices based on information that extends beyond price to include lead times, quantity and item-specific attributes. Because most auctions are open for short periods of time, the bidding process moves quickly which results in increased competition.

Steps in the auction process include:

  1. Creating the auction The buyer defines the auction and includes all the auction item information, the business terms and conditions and intended bidders.

  2. Responding to the auction Bidders participate in the auction by viewing the auction items and submitting bids online. If permitted by the auction rules, bidders can view competitive bids during the auction.

  3. Monitoring the bid responses The buyer and all other participants can monitor the real-time activity during the auction and take action as necessary.

  4. Evaluating and awarding bids The buyer analyzes the bids and awards the auction based on the price, bid quantity, bid attribute value(s). Once the auction is completed, bidders are immediately notified of the auction results via online notifications.

Auction features include: