Limit winners rule use cases

This section includes a number of use cases for the Limit winners rule. You can use these examples to help you create similar and different rules for your scenarios.

Limiting the number of suppliers across a group of lots

In this example, we want to source essential medical equipment. With our current supplies low, it is critical that we receive this equipment to continue service. We want to mitigate the risk posed by relying on only one supplier for every origin-destination pairing, as unforeseen issues or increased demand on the supplier’s side could leave us without the necessary equipment. To better manage this risk, we ensure that the lots are awarded to at least two bidders for every origin-destination pairing.

Limit winners rule — Example 1
Figure 1. Limit winners rule — Example 1

Example explained:

  1. First, we select All bidders, as we want the rule to apply to all bidders.
  2. Next, we select All lots, as we want the rule to apply to all lots.
  3. Then, we select the Origin and Destination columns from the Grouped by list as we want to apply the rule to lots grouped by their origin-destination pairings.
  4. Finally, we enter 2 in the At least field to ensure that at least two bidders are awarded lots for every origin-destination pairing.

Steps:

  1. Go to Evaluate > Scenarios.
  2. Click Add a scenario, or click on an existing scenario in the Scenarios table.
  3. On the Rules tab, on the Limit winners rule, click add.
  4. Under for, click All bidders.
  5. Under on, click All lots.
  6. From the Grouped by list, select the Origin and Destination columns.
  7. Under to, click At least, and then enter 2 in the Enter a value field.
  8. At the top of the Rules tab, click Save changes.

Limiting the number of winners to one per origin

In this example, we are a company that makes solar panels and other renewable energy products. Key values for the company include minimizing our carbon footprint, promoting green initiatives, and reducing the impact on the environment. When sourcing materials and parts from around the world, we do not want to use multiple suppliers in every origin location as this will increase the amount of vehicles carrying the freight to its destination and negatively impact the environment. As this is a priority for our business, we ensure that there is only one winner for each origin.

Limit winners rule — Example 2
Figure 2. Limit winners rule — Example 2

Example explained:

  1. First, we select All bidders, as we want the rule to apply to all bidders.
  2. Next, we select All lots, as we want the rule to apply to all lots.
  3. Then, we select the Origin column from the Grouped by list as we want to apply the rule to lots grouped by their origin.
  4. Finally, we enter 1 in the At most field to ensure that one bidder is awarded all lots for each origin.

Steps:

  1. Go to Evaluate > Scenarios.
  2. Click Add a scenario, or click on an existing scenario in the Scenarios table.
  3. On the Rules tab, on the Limit winners rule, click add.
  4. Under for, click All bidders.
  5. Under on, click All lots.
  6. From the Grouped by list, select the Origin column.
  7. Under to, click At most, and then enter 1 in the Enter a value field.
  8. At the top of the Rules tab, click Save changes.

Limiting the number of suppliers

In this example, due to the associated time and cost overheads of managing additional suppliers, we have decided to consolidate the number of suppliers for our annual ocean freight event to 10.

Our analysts acknowledge that there may be a cost impact for this rule. Having more suppliers will likely contribute to lower costs and increased savings, but the overhead of managing more suppliers can offset this benefit. Our analysts decide that they are willing to forego a maximum of $450,000 in savings to achieve their consolidation targets. To account for this, we set a relaxation threshold. Any cost impact above $450,000 will cost us more than it is worth, and as a result, the rule will be ignored in the scenario evaluation.

Limit winners rule — Example 3a
Figure 3a. Limit winners rule — Example 3
Limit winners rule - Example 3b
Figure 3b. Limit winners rule — Example 3

Example explained:

  1. First, we select All bidders, as we want the rule to apply to all bidders.
  2. Next, we select All lots, as we want the rule to apply to all lots.
  3. Then, we enter 10 in the At most field to ensure that a maximum of 10 suppliers are awarded lots.
  4. Finally, we enter 450000 in the Relaxation threshold field, because if the cost impact of enforcing this rule is higher than $450,000, it will cost us more to consolidate our suppliers to 10 than it is worth to us.

Steps:

  1. Go to Evaluate > Scenarios.
  2. Click Add a scenario, or click on an existing scenario in the Scenarios table.
  3. On the Rules tab, on the Limit winners rule, click add.
  4. Under for, click All bidders.
  5. Under on, click All lots.
  6. Under to, click At most, and then enter 10 in the Enter a value field.
  7. Click the Rule details tab.
  8. Enter the value of the relaxation threshold in the Relaxation threshold field.
  9. At the top of the Rules tab, click Save changes.