eauctions ADMINISTRATION by CKS Auctions This presentation belongs to CKS COPYRIGHT 2017

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2 I. PROCUREMENT & E-AUCTIONS CONSULTANCY SERVICES II. CKS ADDED VALUE & INNOVATIVE METHODS III. BUSINESS CASES

3 I. PROCUREMENT & E-AUCTIONS CONSULTANCY SERVICES About CKS Group A team of experienced consultants working toward enhanced Purchasing FRANCE 34, rue de Cléry F Paris Strategy and operations consulting services Training and competency assessment solutions BENELUX Rue de la Loi 42 B-1000 Bruxelles Procurement BPO and Data Management Procurement systems implementation services

I. PROCUREMENT & E-AUCTIONS CONSULTANCY SERVICES eauctions references in 2017-2018 50 among the EU s 500 largest corporations have used or are using CKS services PUBLIC INSTITUTIONS More than 100

4 I. PROCUREMENT & E-AUCTIONS CONSULTANCY SERVICES eauctions references in among the EU s 500 largest corporations have used or are using CKS services PUBLIC INSTITUTIONS More than 100 public stakeholders have used or are using CKS services Global clients have used or are using CKS services The leadership and expertise of an independent boutique consulting firm specialized in procurement: 80+ procurement audit programs successfully undertaken 50+ procurement systems successfully designed and rolled-out 25k+ people trained in the area of Procurement 500+ full tendering processes outsourced to CKS 1,5 bn purchasing savings recorded by our Clients

5 I. PROCUREMENT & E-AUCTIONS CONSULTANCY SERVICES Sample of CKS credentials

6 I. PROCUREMENT & E-AUCTIONS CONSULTANCY SERVICES eauctions references in Western Europe 5 auctions / week Eastern Europe 5 to 10 auctions / month Russia 2 in 2016 North America 5 to 10 auctions / month China 3 to 5 auctions / semester eauction expertise India 1 to 3 auctions / semester CKS performs dozens of auctions every month CKS has acquired a strong experience in the Automotive Industry CKS organizes and administrates auctions with buyers and suppliers from all over the world Brasil 1 to 3 auctions / month North Africa 1 to 3 auctions / year Southern Africa 1 to 3 auctions / year

7 I. PROCUREMENT & E-AUCTIONS CONSULTANCY SERVICES CKS specialized eauctions business unit CKS Group Management CKS Auctions Manager Methods developement team Account management team Supplier training team Account manager Account manager Account manager Supplier trainer Supplier trainer Supplier trainer The eauctions business unit is structured to address the 500+ eauction events it deals with annually. The team shares internally-developed IT resources to process 80% of eauctions requested by the clients within two business weeks. CKS invests in training the team through methods development.

8 I. PROCUREMENT & E-AUCTIONS CONSULTANCY SERVICES II. CKS ADDED VALUE & INNOVATIVE METHODS III. BUSINESS CASES

9 II. CKS ADDED VALUE & INNOVATIVE METHODS CKS added value in eauctions You are looking for CKS meets your criteria An independent consultancy trusted by your buyers CKS is an independent, Paris and Brussels-based consultancy with top-class consultants who are passionate to help their clients purchase better and cheaper. The team has long-lasting experience in developing eauctions administration for various industrial clients and is trained to build eauction strategies on many purchasing families. Professional trainers who get your suppliers to the Auction whatever their language CKS has developed its own tools and training material to help the suppliers express their best offers in Auction room. We can discuss which languages shall be covered in addition to English, Chinese, Japanese, German, French and Spanish. An efficient eauction administrator to secure your business awards CKS will have Auction terms and conditions validated by your legal department before the first auction. Suppliers will be bound to submit their updated cost breakdown two business days after the auction. Suppliers are all trained based on the live auction parameters. Fairness is brought by CKS action as trusted third-party.

10 II. CKS ADDED VALUE & INNOVATIVE METHODS How we handle the process 1. Provision and management of the reverse auction platform Should the Client not operate an e-sourcing platform already, CKS Auctions will handle the provision, management and acceptance of a state-of-the-art reverse auction platform..., CKS Auctions will provide access to its own auction platform. This platform can be rented upon request for an event or a series of events. 2. Reverse auction strategy setup 3. Event preparation 4. Auction management and follow-up CKS Auctions consultants will first analyze the context, the constraints and the risks related to the call of tender and the Procurement. CKS specialized consultants will then define together with you the auction strategy : what kind of auction? Which parameters? The goal is to select the better option to maximize your purchasing targets. CKS also helps you edit the legal documents in order to be compliant with the applicable regulatory framework : official invitation letter, auction-specific terms and conditions and their appendixes. CKS Auctions will schedule a private training session with each supplier based on the real auction parameters and treated equally. Thanks to this training session, suppliers are more confident and act fast during the auction: they already know how to bid online! This results in significant operational gains for our clients. CKS Auctions sets the parameters up in order to respect the communication issued to the suppliers. Only the suppliers having signed the auction-specific terms and conditions can take part in the auction. CKS behaves as a trusted third-party so as to guarantee : A satisfactory e-auction process by assisting suppliers during the auction CKS can even bid on behalf of a supplier upon written and traceable request ( surrogated bidding ) in case of a technical problem (we keep in touch with the platforms editors) Exact e-auction results Suppliers equal treatment during the auction preparation and the event The confidentiality of information shared by the suppliers during the auction who wish to use advanced bidding techniques.

11 II. CKS ADDED VALUE & INNOVATIVE METHODS eauctions pay off! For Buyers For Suppliers Immediate savings Business opportunities Take the most from a competitive situation Obtain the best offers from your suppliers Long-Term (e.g. 2-3 year) Contracts Focus on Total Costs Improved Market Intelligence Time saving process Drastically reduced Negotiation Cycle Time Re-use of standard methods to send RFQ & analyze offers Faster attribution of the business Access to new markets with reduced acquisition costs Transparency into negotiation Selection criteria are clearly established and communicated Vision of the market prices during the auction Supplier sees he is really competing with others Supplier can react in real time to competitive offers Supplier know why he lost/won the e-auction

12 II. CKS ADDED VALUE & INNOVATIVE METHODS Each eauction event is unique Workshops where suppliers offers are analyzed are organized by CKS with the buyer and the project team to define the best auction strategy and parameters. The training program is adapted to each auction based on the parameters and the suppliers languages. The buyer can follow in real-time the auction preparation using CKS dedicated buyer extranet and interact with their dedicated Account manager. A thorough feedback is sent to the buyer with auction results so that lessons can be shared regarding eauctions experience.

13 II. CKS ADDED VALUE & INNOVATIVE METHODS Preparing an eauction with CKS RFQ SET-UP AUCTION AWARD 1 week to 2 months 1 week 1 to 4 hours 1 to 2 days GO / NO GO Validation of the e-auction parameters Opening of the e-auction room End of the eauction 1.1 RFQ preparation 1.2 Analysis of the suppliers responses 2.1 Definition of the e-auction strategy 2.2 Review/validation of the set-up 3 Contribution to the event 4.1 Analysis of the results 4.2 Communication to the suppliers Workshop #1: Reviewing the suppliers offers Building the lots (V1) Preparing communication to address to suppliers 2.3 Workshop #2: reviewing the eauction strategy: Final lots configuration (V2) Parameters, communication with suppliers 2.4 Set-up of the e-auction room 3. Management of the eauction Providing suppliers and buyers Ensuring the confidentiality & of the data transmitted through the e-auction room Management of the surrogated bidding process 4. eauction comprehensive feedback and synthesis 2.5 Test Auction Gathering of the e-auction rules & terms signed by the suppliers Training of the suppliers through a mock-up event (6 suppliers)

14 II. CKS ADDED VALUE & INNOVATIVE METHODS A dedicated in/extranet to monitor eauction preparation Proud of its qualitative approach to eauctions and in order to have buyers onboarded during the preparation process, a secured extranet gives the buyer a detailed overview. Auction milestones Pending alerts Auction process Setup with the buyer Suppliers training Missing Terms&Conditions Some suppliers have not returned signed Terms and Conditions Missing Training validations Somme suppliers have not returned signed Training validations Request from the suppliers Request from the suppliers Auction Day Payment Company Contact person Telephone Training TC TV Supplier Key Account Manager kam@sup.com

15 II. CKS ADDED VALUE & INNOVATIVE METHODS Your suppliers are adressed in their local language Our interface allows multiple languages to communicate with suppliers on the auction preparation process. Default package is comprised of French, English, German, Spanish, Chinese, Japanese, Dutch and Russian. Should you provide us with translations, we can embed additional languages. CKS Auctions Participation of Supplier XYZ to Auction ABC 1 Being ready for the auction 2 Joining the event on Auction day Your training session in planned on 03/05/2017 at 10:30 Paris local time. Your connection details for the training have been sent by emial together with the Calendar invitation. Should there be any issue regarding your training, please auction@cks-consulting.com To confirm your particpation to the auction, you need to sign and upload back page of the Terms and conditions and the larst page of the Training Guide sent by the Buyer. Information Documents are pending validation by the auction administrator Upload signed Training Validation (only one file - PDF or image) Choisissez un fichier Aucun fichier choisi Please read carefully the documents sent by the Buyer: the Auction Terms&Conditions, the invitation letter and the Training Guide. Prequisites for Auction ( missing, ongoing, validated ). Training Terms and Conditions Training Validation Auction is on 09/05/2017 at 10:30 Paris time. 30 minutes ahead please connect using your login password. If you have issues connecting, please contact immediatly CKS: / auction@cks-consulting.com

16 II. CKS ADDED VALUE & INNOVATIVE METHODS Training material translated into multiple languages Welcome to your e-auction s training program We want to get you to acheive the best possible during the auction. Here is the agenda : 1 Explain the role of the different actors of this auction 2 Review the documents you have received from the buyer 3 Show you how to access the auction platform 4 Show you how to place an offer during the auction 5 Inform you about the next steps before the Auction starts 2 Review the documents you have received from the buyer Several documents have been sent to you. Please read them carefully. Start the training Invitation letter Auction terms & conditions Supplier s user guide Quotation grid CKS is the auction administrator and trusted third-party Fell free to contact us at: auction@cks-consulting.com Our animated tutorials detail the actions required from the supplier. Demo videos insist on all steps. The invitation letter indicates the auction s date and time as well as the lt parameters. This is crucial for you to prepare your offer before Auction day! This document details the awarding criteria and the specifications of the items the buyer wishes to procure. This document will be useful for you during the auction. It also contains the «Training validation sheet». Reaching Auction room Please check the documents and make sure you fully understand them. Do not wait for AUction day to ask questions to the buyer! This optional document may be sent to help you prepare your offer: please note down the «value to use in auction».

17 I. PROCUREMENT & E-AUCTIONS CONSULTANCY SERVICES II. CKS ADDED VALUE & INNOVATIVE METHODS III. BUSINESS CASES

18 III. BUSINESS CASES Case study 1 Designing a strategy for bundling CKS addressed the buyer s issue of global sourcing. Context The projects led on three continents had the same three suppliers up for business-awarding. CKS proposal and actions To see each supplier s best offer, CKS designed a two-round auction: one auction for each project to shortlist the overall two-best suppliers then a final auction considering the three projects at the same time. CKS showed full responsiveness to organize Round 2 two days after Round 1 with the shortlisted suppliers trained in between. Results The buyers were in the end fully satisfied: the winning supplier s initial offer was improved by 240 k (-8%). CKS will discuss with you in order to design the best eauction strategy, making an finest use of the possibilities offered by features around eauctions lots and rounds.

19 III. BUSINESS CASES Case study 2 Secure your supply through double-sourcing 80% of the parts will come from Supplier 1,20% from Supplier 2. Context For a strategic project, the buyer wanted to mitigate the risks of supply shortage through double-sourcing. CKS proposal and actions CKS designed a strategy enabling the selection of two suppliers, selected on the part unit price : The supplier offering the smallest unit price during the eauction getting 80% of the business over the lifetime The supplier proposing the second best offer getting 20% of the business Part unit price and Share of business awarded 80% 20% Supplier 1 Supplier 2 Results The double-dutch auction had a positive impact: 420k savings on the total business (2.7M awarded value). CKS adjusts the type of eauction as well as its perimeters to make it fit your strategy and business needs. eauction types include: English rank-based or best-offer based, Japanese, Dutch and Forward auctions. Perimeters will enable to fine-tune the strategy.

20 III. BUSINESS CASES Case study 3 Non-production purchases are eligible to eauctions (1/2) CKS assists buyers in reducing their Facility Management costs. Context Multinationals tend to rationalize their supplier panel for non-production purchases: auctions help select the best one! CKS proposal and actions CKS designed a strategy for a Forward auction and created a quotation grid helping the client not only to reach reserve price but to exceed it (see next page). Results The buyer was extremely satisfied: immediate cash was generated directly at the end of the auction for his company with a final price 2,8 times higher than the reserve price. In some cases, eauctions can help your company to sell at the best price ( Forward auction ): Selling scrap (iron, aluminium ) Setting up the rent for a services provider willing to operate on your plant Etc. CKS will design a strategy and quotation grid helping you reach reserve prices and often exceed them.

21 III. BUSINESS CASES Case study 3 Non-production purchases are eligible to eauctions (2/2) Target: Rent three cafeterias to the same services provider at the best price on three plants. 1,600 1,400 Final price = 1,432 1,200 1, Reserve price Reserve price = Start price Starting price = Reference price 0 11/02/ :00 11/02/ :04 11/02/ :09 11/02/ :14 11/02/ :19 11/02/ :24 11/02/ :29 11/02/ :32

22 François COLLINEAU Partner +33 (0) Rue de la Loi Brussels - BELGIUM auction@cks-consulting.com Tel: Fax: Pierre-Édouard LABBÉ Manager +32 (0) This presentation belongs to CKS auction@cks-consulting.com COPYRIGHT

Dear Valued Supplier,

Dear Valued Supplier, Thank you for your commitment to providing Centrica with quality materials and services. As part of our ongoing efforts to enhance and streamline the way we do business with suppliers,