A Decision Method in B2B E-Commerce Model based on Multi-Items Auction

Abstract

This paper proposes a new B2B electronic commerce model from bidding information in double auctions. In B2B electronic commerce, buyers try to purchase multiple items at the same time, since a buyer develops something products by using purchased items. Also suppliers have an incentive of making coalitions, since buyers want to purchase multiple items in the model. A mechanism designer has to consider an optimal mechanism which calculates an optimal matching between buyers and suppliers. To find an optimal matching is very hard, since a mechanism calculates all combinations between buyers and suppliers. Consequently, we propose a calculation method which has two steps; first the mechanism determines winners of buyers' side, second the mechanism determines coalitions and winners of suppliers by using the result of buyers' side. This paper also discusses the improved method with dynamical mechanism design by using the bidding information. Advantages of this paper are that each d eveloper can procure the components to develop a certain item and tasks are allocated to suppliers effectively. The previous result of auction data can be available to shorten the period of winner determinations. Contribution of this paper includes two parts. One is creating a mathematical model of procurement auction, which is able to apply to practical situation. The other is proposing dynamic mechanism for the procurement auction.