In life sciences, smooth procurement processes are essential for advancing research, ensuring compliance, and keeping operations efficient. Perhaps the most critical is the Procure-to-Pay (P2P) cycle, which covers everything from identifying a lab supply purchasing need to making the final payment. Optimizing this process helps labs save time, reduce errors, and build stronger relationships with suppliers; all of which are key to supporting scientific discoveries.
What is Procure-to-Pay (P2P)?
Procure-to-Pay (P2P) refers to the end-to-end process that businesses use to manage purchasing and payments. It starts when an organization identifies a need for goods or services and ends when the payment for those goods or services is made to the supplier. In simple terms, P2P is the complete flow of activities from requisition to payment, ensuring that the right items are purchased, delivered on time, and paid for correctly. For life sciences organizations, this means efficiently managing lab supplies, reagents, equipment, and services while maintaining financial control and adhering to compliance standards.
Understanding the Procure-to-Pay cycle
The P2P cycle in life sciences consists of several stages:
- Need identification: Recognizing the need for specific lab supplies or services.
- Supplier selection: Evaluating and selecting suppliers based on quality, reliability, and cost.
- Purchase order creation: Issuing formal purchase orders to suppliers.
- Receipt of goods/services: Inspecting delivered items to ensure they meet the required standards.
- Invoice processing: Matching invoices with purchase orders and receipts to ensure accuracy.
- Payment: Processing payments in line with the agreed terms.
By managing these stages effectively, organizations can acquire the necessary resources efficiently while keeping finances in check.
Best practices for optimizing P2P in life sciences
Efficient procurement is not just about saving money; it’s about enabling smooth operations and supporting research activities. To streamline the P2P process, procurement, lab operations, and finances should consider implementing the following best practices:
- Automation and technology integration. Advanced procurement platforms can automate tasks like purchase order creation and invoice matching, which reduces manual errors and saves time. Automated workflows improve accuracy, speed up approvals, and reduce administrative workload.
- Vendor relationship management. Strong, collaborative relationships with suppliers lead to better pricing, improved quality, and more favorable terms. Regular performance evaluations and clear communication are key for maintaining these relationships.
- Policy and compliance management. Clear procurement policies, coupled with adherence to industry regulations, ensure that all purchases are within budget and comply with relevant laws. Automation can also help ensure compliance by integrating predefined rules and checks into the procurement system.
- Data analysis and reporting. Using analytics tools to monitor spending patterns, supplier performance, and process efficiencies allows for data-driven decisions. Regular reporting helps identify opportunities for cost savings and process improvements.
- Training and development. Ongoing training ensures that procurement and lab operations staff are well-equipped to handle P2P processes and new tools effectively, ensuring smooth operation and minimizing errors.
- Interdepartmental collaboration. Encouraging collaboration across departments, especially procurement, finance, and research teams, ensures alignment and effective communication, helping to achieve common organizational goals.
P2P challenges for procurement
While a well-functioning P2P system offers numerous advantages, there are challenges to be aware of, including:
- Manual processing and errors. Many procurement processes rely on manual data entry and approvals, which can lead to errors in invoice matching, purchase orders, and receiving. This manual work not only slows down the process but also increases the likelihood of mistakes and duplicate ordering.
- Inefficient supplier management. Managing a diverse supplier base can be challenging without a centralized system. Without regular supplier evaluations and performance tracking, it’s difficult to ensure that suppliers remain reliable and cost-effective, potentially leading to delays and higher costs.
- Policy compliance and regulatory issues. Procurement teams must ensure that all purchases adhere to strict policies and regulatory requirements. Without a robust system, maintaining compliance becomes complex and time-consuming, which increases the risk of non-compliance.
- Delayed approvals and payments. Slow approval processes and delayed payments are common in procurement workflows, especially when relying on outdated, paper-based methods or manual reminders. These delays can disrupt operations and negatively affect supplier relationships.
- Lack of visibility and control. Without a comprehensive procurement system, it’s challenging for teams to track spending, supplier performance, and the overall efficiency of the P2P cycle. This lack of visibility can lead to overspending, missed savings opportunities, and poor decision-making.
- Fragmented communication between departments. In many organizations, procurement, finance, and research departments operate in silos. This fragmented communication can lead to misunderstandings, delays in the procurement process, and inefficiencies in the overall workflow.
- Juggling multiple PunchOut catalogs. Many organizations rely on upwards of hundreds of punchout catalogs to be able to fulfill purchasing needs. Managing catalogs with different interfaces and systems complicates purchasing, drains time, makes pricing comparisons difficult, increases the likelihood of errors, and makes it harder to maintain visibility and control over spending.
Learn more: 5 Challenges of Juggling Multiple Lab Supply PunchOut Catalogs, and How to Fix Them
Procurement challenges unique to life sciences
While P2P platforms aim to automate the entire life cycle, life sciences procurement needs present unique challenges that can prevent 100% automation, including:
- R&D innovation requires specialized products. Life sciences often need unique, low-volume products for specific experiments, complicating procurement and leading to a growing longtail.
- Time-consuming purchasing. Scientists often spend significant time searching for supplies, which takes time away from research.
- Backorders and vendor exceptions. Issues like backorders or finding alternatives to specific items waste valuable time.
- Regulatory and compliance needs: Adhering to strict regulatory requirements while maintaining procurement efficiency is a delicate balance.
The solution lies in balancing the needs of R&D innovation with procurement goals for streamlined, effective processes.
The role of ZAGENO in streamlining P2P
What is ZAGENO?
With over 40 million product SKUs available from more than 5,300 leading brands, ZAGENO offers the largest life sciences lab supply marketplace. Our AI-driven, one-stop solution helps scientists, lab managers, and procurement leaders compare products across vendors, easily source product alternatives, track deliveries, and communicate order status with R&D teams in real time. ZAGENO makes online shopping for any research material convenient, efficient, and reliable. By integrating with leading P2P platforms, ZAGENO jumpstarts stalled automation, making it easier to manage lab supply purchasing from requisition to payment.
Benefits of integrating ZAGENO with your P2P platform
- Seamless integration. The ZAGENO platform seamlessly integrates with top procurement platforms, including Coupa, SAP Ariba, Jaggaer, Procurify, ProcureDesk, Fraxion, Point Purchasing, Corpay (formerly Accrualify), Tungsten Automation, and more to come.
Learn more about becoming a ZAGENO integration partner
- Tame both routine and longtail spend with one PunchOut integration. ZAGENO’s intuitive platform combines all your lab supply needs into a single PunchOut catalog. With one cart, you can easily compare and order products from multiple suppliers, streamlining the purchasing process. New suppliers are added swiftly, and with ZAGENO lists, collaboration across teams is seamless, helping you manage both routine orders and specialized, low-volume items efficiently.
- End-to-end automation. An intuitive user experience guides you through product browsing, requisitions, order placement, order tracking, receiving, invoicing, and reporting, all while automating manual tasks and reducing errors.
- Streamlined payments. Optimize your accounts payable with automated workflows that seamlessly connect ZAGENO to your P2P platform, ensuring predictable invoice cadence, uniform payment terms, and a single bill-to for easier financial management.
- Strategic lab supplier management made simple. ZAGENO streamlines supplier management by providing access to over 5,300 pre-vetted and onboarded suppliers. If you need a new supplier, our team handles everything from due diligence to onboarding within hours. With a single supplier record and consolidated invoices, your accounting becomes hassle-free. ZAGENO also ensures contract compliance, so you can maximize every deal.
Learn more about Strategic Lab Supplier Management
- Easier product searching and ordering. Quickly compare, select, and order the right products in just a few clicks, so your team spends less time shopping and more time on research. Scientists save on average 6.2 hours/week finding and ordering products using ZAGENO.
- Minimize backorders and vendor exceptions. ZAGENO helps you avoid delays caused by backorders and vendor exceptions by offering real-time inventory updates, suggesting alternative products when needed, and onboarding new suppliers within one day.
- Automated 3-way matching. With ZAGENO’s automated 2-way matching, purchase orders, receiving reports, and supplier invoices align seamlessly, and our convenient mobile receipt upload or email feature guarantees accuracy and prevents fraud.
Case Study: P2P integration with ZAGENO at a biotech
Background: A small, budget-conscious biotech was struggling under the weight of a manual lab supply ordering process. Their team was searching for a Coupa-compatible platform to help them move beyond spreadsheets and Sharepoint and automate the procurement process. With the clear objectives of cost savings, time savings, and R&D autonomy, their company of 54 employees partnered with ZAGENO in the hopes of addressing their lab supply ordering pain points and relieving accounting and R&D of unnecessary constraints.
Solution: By integrating with ZAGENO’s marketplace, the company automated vendor setup, consolidated invoices, and gave R&D teams the ability to place their own orders. This streamlined the process and freed up the accounting department.
Outcome: $326,575 in labor savings and 3,585 hours saved, 91% of orders delivered on time, and Improved visibility into spend and optimized approval flows.
Read the complete P2P automation case study
Finalize P2P automation
In life sciences, every second counts when it comes to procurement. A seamless Procure-to-Pay (P2P) process is not just about efficiency, it's about empowering researchers with the right tools, supplies, and resources at the right time to drive innovation forward.
Ready to accelerate your procurement process? ZAGENO’s platform integrates effortlessly with P2P platforms like Coupa, SAP Ariba, and Jaggaer, helping you streamline purchasing, optimize spend, enhance supplier relationships, and unlock the resources needed to fuel groundbreaking discoveries. Contact us to take your procurement to the next level.
