Presentation on theme: "Intelligent Personalized Trading Agents that Facilitate Real-time Decision-making for Auctioneers and Buyers in the Dutch Flower Auctions Case by Wolfgang."— Presentation transcript:
Intelligent Personalized Trading Agents that Facilitate Real-time Decision-making for Auctioneers and Buyers in the Dutch Flower Auctions Case by Wolfgang Ketter, Eric van Heck, Rob Zuidwijk Rotterdam School of Management, Erasmus University
Advocate Agents - Slide 2 Overview and Scope Introduction Clock auction mechanism Decision making supported by agents No solution yet! – case purpose: exploration
Advocate Agents - Slide 3 Dutch Flower Auction Worlds largest Association set up by growers Flower industry is a giant network – Including: breeders, growers, auctions, wholesalers, retailers, and transportation firms for im- and export. Import from warmer countries: Israel, Kenya, Zimbabwe etc. Export to: Germany, UK, France
Advocate Agents - Slide 4 Click picture to start Youtube movie (start at 1.20 min)
Advocate Agents - Slide 6 Auction Locations DFA has 6 individual auction locations spread throughout the NL, with a total of 39 auction clocks Conducts buying transaction Shipment of goods Buyer is a retailer who buys for himself Client is a retailer Shipment of goods Wholesaler who buys for client Conducts buying transaction 1 st scenario 2 nd scenario
Advocate Agents - Slide 7 Clock Auction Flowers transported from cold-storage warehouse to auction hall on carts. 2-3 clocks per hall. Sample shown to bidders by raiser. Buyers bid using Dutch auction: price starts high and drops fast. First person to stop the clock wins and pays that price. Invented in Extremely fast! On average an auction clears every 3-5 seconds.
Advocate Agents - Slide 8 Clock Auction cont.
Advocate Agents - Slide 9 Clock Auction cont. One lot is divided among many commercial transactions – Lot: is the supply of flowers from one grower – Commercial transactions (sub lots): are different portions of one lot sold to different buyers Units for salePriceQuantityBuyer 2515 ct5H. De Jager 2014 ct6T.H. Pietersen 1418 ct4P.J. De Vries 1013 ct5A. Jansen 512 ct5A. B. De Groot 1 lot 5 commercial transactions or sub lots E.g. 1 lot below is divided into 5 commercial transactions.
Advocate Agents - Slide X NameExample values 1. ProducerMr. Z. Boon 2. ProductTulips, roses etc. 3. Unit of currencyCents, 5 cents, 10 cents, Euros etc. 4. BuyerMr. S. Klaasen 5. Units 6. Number per unitAmount of stems per unit 7. Minimum purchase quantity 8. Negative comment on quality Nice leaves 9. Positive comment on quality Small water stains 10. Quality indicationA1 (highest quality), A2, B1, B2 (lowest quality) 10 2
Advocate Agents - Slide 11 Products Units (= wagons x units per wagon) WagonsUnits per trolley Amount of stems per unit S1, S2, S3, and S4 are sorting methods S1 = length S2 = weight, or diameter S3 & S4 are dependent on the traded flower Negative comments Positive comments Grower (seller) Clock Lot nr.Unit of currency Amount of stems per unit Units Minimum purchase quantity Identification number of the auctioned goods Information Sub lot nr.
Advocate Agents - Slide 12 Information Flower type and quality (including pictures and videoclip) Seller (name, background, reputation) Auction clock (price, units) Buyer (identification) Previous transactions Services (logistics, payment, settlement) – Different buyers have different information needs…
Advocate Agents - Slide 13 Buyer Profiles 1. General wholesaler (cost driven exporter) 2. Specialist wholesaler (differentiator on quality) 3. Large retailer (medium quality retailer) 4. Small retailer (flower shop with specific client wishes) Competing in different markets => different information needs Information needed for decision making – Price information – Product information – Transportation information
Advocate Agents - Slide 14 Decision Parameters (1) price (2) product, including quality (3) transportation costs (4) transportation time (5) upcoming auctions (6) market conditions – More? Based on this information, must choose price and quantity in about 4 seconds
Advocate Agents - Slide 15 Auctioneer Profile Auctioneer governs clock trading process, by controlling five parameters – Speed of clock – Initial price – Swingback – Reserve price – Minimum lot size Speed vs. price tradeoff
Advocate Agents - Slide 16 Decision Parameters (1) historical prices (2) quality measures (3) upcoming auctions (4) market conditions – More? Based on this information, must make 5 decisions in about 4 seconds
Advocate Agents - Slide 17 Intelligent Software Agents An agent is anything that: – perceives its environment through sensors – acts autonomously upon that environment through effectors. A human agent – Sensors: eyes, ears etc. – Effectors: body parts as hands and legs.
Advocate Agents - Slide 18 Intelligent Software Agents Intelligent software agents are used for complex decision-making Intelligent agents monitor the environment, make internal calculations, and act (or recommend actions) autonomously. Useful for supporting trade at auctions. E.g. for eBay auctions there are auction bots.
Advocate Agents - Slide 19 Example of Ebay auction agent You define your preferences (personalize) and the agent monitors auctions and buys (acting autonomously) for you.
Advocate Agents - Slide 20 Case Conclusion Case Question: How can personalized intelligent agents be used at the DFA to enable better decisions for the bidders and auctioneers? Guiding question: Do agents bring a saving in costs, or a true competitive advantage?
Advocate Agents - Slide 21 Dutch Flower Auction Case You might want to explore… (DFA website) Auction bidding software – – Chapter 2 of Artificial Intelligence: A Modern Approach by Russell and Norvig, Maes et al., Agents that Buy and Sell