A parallel bargaining protocol for automated sourcing of construction suppliers

Abstract

Bidding is a critical decision process as it would determine whether a contractor can win a construction contract at a reasonable profit margin. Among various factors affecting the bidding decisions, the selection of suitable suppliers for the provision of various construction materials is one of the most important aspects in ensuring bid and project success. Despite that, in the absence of time at the bidding stage, the negotiation with suppliers is normally carried out in a crude and unstructured manner, and the terms and prices for material supply could be far from ideal. Automated negotiation using the Multi-Agent System (MAS) concept can reduce the response time and maximize the expected profit should a suitable negotiation protocol be devised. In this paper, a parallel bargaining protocol is proposed by analyzing the characteristics of the negotiation process involved in suppliers sourcing. This new protocol is an extension of the fish-market protocol in which the bargaining of material terms and prices is conducted with several suppliers concurrently. Although some limitations were found in the study, the protocol appears to have great potential in the problem domain, and it could provide a solid foundation for the design of a MAS for the sourcing of suppliers for construction projects. © 2005 Elsevier B.V. All rights reserved.