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What is an Auction Bid?

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  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 02 December 2016
  • Copyright Protected:
    2003-2016
    Conjecture Corporation
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The auction bid is a way for individuals to actively participate in an auction. Essentially, the bid is a written or oral statement of the amount the individual is willing to pay in order to acquire an item that is presented for sale at the auction. There are several different strategies that are employed with the bidding process, depending on the nature of the auction.

A basic live auction situation will use simple methods to allow attendees to place an auction bid. This is often accomplished by furnishing each authorized bidder with a small paddle. When the attendee wishes to place an auction bid on the item currently up for bidding, he or she will raise the paddle, indicating to the auctioneer that the bidder is willing to pay the current asking price.

A less formal auction situation will make use of an auction bid that requires nothing more than each participant voicing a bid offer. With this type of bidding activity, the auctioneer will recognize each verbal bid as it is made, often calling the bidder by name or a by an number assigned to each bidder as they entered the bidding area. This helps to ensure that each bid is recognized in proper order, and that there is no question of who actually won the auction.

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Companies will sometimes use an auction to obtain the best price for goods or services offered from several vendors. An auction of this type is usually a closed process, with the company inviting specific vendors or suppliers to participate. If the auction is taking place offline, bidders are usually supplied with a bid form, as well as terms of use that are outlined in accompanying instructions. Vendors return the bid proposal sheet by a specific date and time. Shortly afterward, the company will award the business to the vendor with the winning bid.

A variation on this process requires that the auction bid be accompanied with a formal proposal. All proposals submitted must comply with guidelines provided in the Request For Proposal, or RFP, issued by the company. This can include the use of the authorized Request for Proposal template, accompanied by the bid template provided by the company overseeing the bid process.

Online bidding is also a common occurrence today. Auction web sites use a specific auction bid process that all participants must follow. Failure to do so can lead to being banned from the site. Businesses also sometimes issue RFPs and accept auction bids using the Internet. This makes it possible for people to submit an auction bid even if they are not in a position to travel to a central geographic location for the event.

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