Problem: Though tedious, purchasing is not trivial. A four-person lab spends one hour per day on the task and that time increases with the size of the lab. The average lab spends 20 percent of its research budget on lab supplies and equipment—that's about $60,000 per lab (assuming the average NIH grant is ~$300K/year in constant dollars).

Unfortunately, these research resources are not allocated as best as they could be. Increased competition to produce data to secure funding means scientists lack the time to shop around and ask for the best prices. This results in overpaying and in some cases, purchasing lower quality supplies that could compromise experimental reproducibility.

Figure 1. Supplier list prices for common lab consumables. List price varies significantly by supplier. Purchasing all items from the most expensive supplier would cost $2,554.34. This is nearly 400% greater than the cost of ordering each item from the lowest cost suppliers ($688.84).Source: HappiLabs Independent Analysis

Figure 2. Purchasing cycle for lab supplies and equipment. The complete purchasing cycle is a seven step process that for each item can take up to 60 minutes over the course of a week. An experienced Virtual Lab Manager can cut cycle time in half to 30 minutes per order.

Solution: Taking these three simple steps can save money and time on purchasing:

1. Shop Around: Many scientists are unaware of inflated prices and the pricing variation between suppliers (Figure 1). Is your lab overpaying?
   
   Look for the lowest price overall and avoid shopping exclusively with a single supplier. Check to make sure that suppliers’ discount offers will really save you money, as these items may have a “list price”—the price listed on their websites—that is significantly higher than competitors.
   
   
2. Negotiate: Suppliers bank on the fact that scientists will not negotiate, either because they do not know it is “allowed” or because they do not have the confidence to do so. Never settle for list price. Negotiation is always fair game, whether it’s for the cost of the item or the cost of shipping.
   
   For capital equipment, start the process a month or two in advance of the planned first use. Have a clear idea of needs versus wants in terms of item features and warranties. Obtain two or three quotes for the item to use as leverage and then negotiate with suppliers.
   
   For consumables, keep track of how much is spent with each supplier. Take note of frequently used suppliers. Repeat business is grounds for negotiating free or discounted shipping.
   
   
3. Simplify with a Virtual Lab Manager: Taking the first two steps will reduce costs, but there must still be a dedicated lab member to take the time and complete the rest of the purchasing cycle (Figure 2). A Virtual Lab Manager may be the best option to handle purchasing operations in labs without a manager (for example, startups or those led by new PIs), manager-less labs, or those in which grad students or post-docs double as managers.

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HappiLabs Virtual Lab Managers (VLMs) handle lab shopping and financial management, as well as traditional lab manager duties, such as inventory management. VLMs are dedicated shoppers and negotiators who know the purchasing cycle like the back of their nitrile glove-covered hands. They systematically collect and study pricing data such as those in Figure 1 to ensure labs do not overpay. For example, HappiLabs Virtual Lab Managers used strategic purchasing to save a startup nearly $5,400 on lab setup costs (reagents, consumables, and equipment). Labs that work with VLMs not only save money, but also save and can re-invest into their research the time they would have spent shopping around, tracking shipments, and reconciling invoices.

For more information, please read the HappiLabs blog to learn more about science funding well spent or to hire a Virtual Lab Manager.