Towndata bids for auction market

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"Power in numbers"

A longtime publisher of municipal reference guides has ventured into the

online auction marketplace for goods and services that fall below the public

bid threshold.

So far, Towndata.com Network Inc., Neptune, N.J., is providing only New

Jersey municipalities with the free Web-based service, which it launched

in January. But it plans to expand the service to Pennsylvania, New York

and Delaware this summer and eventually nationwide, said Keith Haurie, vice

president of sales and marketing.

In New Jersey, annual purchases of goods and services of more than $17,500

require a sealed-bid process, in which a government requests sealed price

quotes from vendors for a product or service, Haurie said. For total purchases

of less than $17,500 yearly for particular goods and services, municipal

officials usually call around for a good price, which is inefficient and

could be costly, Haurie said.

After registering on the site, municipalities, school districts or law enforcement

agencies can post their requests for quotations online. Towndata automatically

sends e-mail messages to registered vendors matching the buyer's requirements.

In a reverse-auction process, vendors competitively, and anonymously, bid

for the contract over a three- to five-day period, which a municipality

can view in real time.

The successful bidder pays Towndata a commission, ranging from $10 to $150,

based on the awarded price. Vendors also must pay a non-refundable $150

set-up fee when they first register. A buyer and vendor then finalize the

deal off-line. Haurie said the process saves government agencies money and

time through competitive bidding.

More than 80 categories, ranging from computers to uniforms, are offered

on the site, which has about 130 registered vendors. Haurie said the company

is running about five auctions a day. The site also will offer news links

about municipalities, a chat room and job openings at municipalities, all

for free.

Despite the failure of several e-government and online auction companies,

including govWorks Inc. and eCitydeals, Haurie said Towndata is well-positioned

because of its reputation in the government arena through its Municipal

Reference Guides, published in 13 states and Washington, D.C. He said the

failed companies expanded too fast, too soon, but Towndata is selling its

product through grass-roots marketing.

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