Lab Supply Ordering Scalability: From Email to PunchOut Catalog to Lab Supply Marketplace

Did you know there are two common misconceptions about the lab supply ordering process? The first is that only late-stage biopharma or pharma companies can access better lab supply pricing and terms. The second is that the lab supply purchasing process only gets more bloated as a company scales. The truth is that there are tools — such as supplier websites, PunchOut catalogs, and lab supply marketplaces — available to labs of all sizes that can reduce costs, improve efficiency, and support scalability.

Lab Supply Ordering Processes, by Organization Stage

Diagram depicting lab supply ordering processes: Email/spreadsheets, Supplier websites, PunchOut catalogs, and Lab supply marketplace

Three main types of lab supply ordering processes: Definitions and considerations

Types Applicable Organization Stage Requirements
Email / spreadsheets

Supplier websites

Best for: Startup, early-stage biotech
Basic spreadsheet software

How do you order lab supplies using email/spreadsheets/supplier websites?

After searching supplier websites for the necessary product, the lab technician typically completes a requisition form and submits it for approval to the lab manager via spreadsheet or email. The manager may need additional information and/or reminders to complete the task. The technician must then shepherd the request through the appropriate approvers, all of whom may have additional questions or need reminders. Once approved, the technician places the order, either via the supplier’s website, email, or purchase order (PO). POs are tracked in another spreadsheet. From there, accounting must be notified so the vendor can be paid.

Considerations for ordering lab supplies via email/spreadsheets/supplier websites

In startups and early-stage biotechs, the small number of scientists makes this manual process doable. Once the lab begins to grow, the process becomes too inefficient and untenable. In addition to delaying the time to receive needed supplies, this fashion of procurement limits spend visibility, complicates expense management, and makes compliance difficult. Errors are prevalent as data must be re-entered at various steps in the purchasing process, resulting in duplicate orders, re-work, and additional expenses.

Type Applicable Organization Stage Requirements
PunchOut catalogs Best for: Mid-stage, late-stage, pharma
P2P/S2P platform, ERP platform

How do you order lab supplies with PunchOut catalogs?

Labs approaching the mid-stage biotech phase typically implement an Enterprise Resource Planning (ERP) system to integrate functions such as accounting, finance, HR and compliance. However, ERPs do not have the functionality to manage the lab supply ordering process. Labs may choose to implement a procure-to-pay (P2P) or source-to-pay (S2P) platform to address this gap. PunchOut catalogs are mechanisms used by P2P systems that enable buyers to purchase supplies from pre-determined suppliers through the buyer’s own procurement portal. Scientists “punch out” of one catalog and into another to find the products they need. Each order from a different PunchOut catalog triggers its own PO and invoice, requiring separate order tracking and additional paperwork. The PunchOut catalogs available are pre-determined. If an end user needs to order from an off-catalog supplier, they must submit a free-text request to initiate the often lengthy supplier addition process, all of which contributes to a growing longtail.

Considerations for ordering lab supplies with PunchOut catalogs

Before implementing a P2P platform that utilizes PunchOuts, it is important to determine who will be responsible for catalog maintenance, how easy it will be to purchase from non-preferred suppliers, who will be responsible for adding new suppliers to the system, and how easy the process will be to navigate. PunchOuts improve process automation, spend visibility, and purchasing management, as well as reduce labor costs and PO cycle times. However, the complexities of the R&D space only allow for process automation up to a certain point before it stalls. This disconnect is due to the lab’s need for supplier choice in order to achieve scientific innovation. It is not possible to achieve 100% lab supply ordering automation with a P2P system alone due to the robustness of R&D longtail spend.

Type Applicable Organization Stage Requirements
Lab supply marketplaces Best for: All stages
None. Easy integration with P2P and ERP

How do you order lab supplies with a lab supply marketplace?

Lab supply marketplaces, such as ZAGENO, arose from the need to tame R&D longtail spend, allow labs of all sizes to access enhanced bargaining power, and achieve full automation. Utilizing an Amazon-life platform, ordering users can build a single cart from millions of products from thousands of qualified, pre-vetted suppliers and receive one consolidated monthly invoice. Labs can either access a lab supply marketplace as a stand-alone or integrate it as a PunchOut catalog within their P2P platform. Orders circulate through streamlined approval processes and can be designated according to cost center, experiment, scientist, and other dimensions. End users have self-service, real-time access to order, shipping, delivery, receiving, and spend data. If a product is only available from a supplier that is not already part of the marketplace, the customer service team can set up and onboard the new supplier within 24 hours.

Considerations for ordering lab supplies with a lab supply marketplace

No matter the company’s stage, the ability to adapt and scale is critical when designing or refining the lab supply purchasing process. As labs grow, lab supply marketplaces easily accommodate changing requirements and are designed to handle a growing number of users, suppliers, and products. Also critical is the ability to seamlessly integrate with existing or future platforms, such as ERP, P2P/S2P, and other accounting and finance software. Accessing a lab supply marketplace significantly reduces labor costs, enables cost savings due to price comparison and leveraged buying power, and makes scientists’ lives easier.

No matter the stage of your organization, it’s time to explore how streamlining your lab supply ordering process with ZAGENO can help you grow.

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