Compare bidding and auction.

The major differences between bidding and auction are as follows −

Bidding

• Buyer buys the commodity by offering a bid/price.

• It includes competitive offer for a product/service.

• It shows value/demand for a product/service.

• The main aim is to win the contract/bid that put for an auction.

• It creates competition to increase demand for a commodity.

• For organisations, bids are allotted for lower bid with proper quotations and paper works.

Auction

• It is held to get better value for goods/service sold.

• It is the process of buying/selling.

• Bidders are allowed to place the bid and highest bidder will be allotted the goods/services.

• The main aim is to get best/highest price for a good/service.

• The marketing plan is to increase the commodity value.

• The companies/organisations will auction their commodity to determine its value and demand.