Quick… How much did you spend on 50 ml Erlenmeyer flasks in the last 18 months? Okay, now how much did you spend on that item, per supplier? How many orders did you place? By site? By cost center? By scientist? Do you have a negotiated discount with any of those vendors? Was it applied? Has the item’s price increased or decreased from the previous year?
You should be able to pull this information in less than five minutes. If you can’t, then you don’t have adequate lab supply spend visibility, which means that you are leaving money on the table, wasting resources, and delaying time to market.
Per McKinsey research, 40 to 80 percent of a company’s total costs come from spend with outside suppliers. Further, Bain & Company research shows only 30% of pharma executives feel that their organization performs “very well” on offering them spending accountability. There is too much at stake in the life sciences industry not to know where the money is going. How well does your organization do?
What is life sciences spend visibility?
Spend visibility is the ability to get an accurate, real-time view into company spend, from as narrow or as wide a perspective as needed, with the goal of analyzing the data to make informed purchasing and budgeting decisions that reduce costs and increase efficiency. If you don’t know what you’re spending at any given moment, you have no hope of managing the spend effectively.
Lack of real-time spend visibility limits the lab, finance, and procurement
Pain points for scientists/lab managers
- Difficult to match budget, including expenses and project codes
- Can’t accurately gauge budget utilization
- Lack of ordering visibility leads to delayed experiments, missed deadlines, and inefficient inventory management
- Difficult to manage supplier relationships
Pain points for finance/procurement
- Can’t leverage buying power without knowing supplier spend
- Can’t identify strategic savings opportunities
- Hard to forecast expenses without real-time budget utilization data
- Difficult to understand current company liabilities
- Hard to keep tight pulse on capital efficiency
- Preparing for audit is high-risk and tedious
To address these abundant pain points, many pharma and biotech firms use a lab supply marketplace to simplify purchasing decisions. In addition to serving as one-stop places to shop, track, and control costs, some marketplaces such as ZAGENO offer detailed, real-time spend analysis dashboards with up-to-the-minute data that can be easily sliced and diced.
Ideal lab supply spend dashboard characteristics
- Out-of-the-box design means that no customization is required or technical expertise needed to deploy
- Data integrity guarantees one true source of lab supply spend data for the entire organization
- Each metric can be filtered by timeframe, user, user types, categories, sub-categories, location, cost center, product types, products, project codes, supplier brands, and more
- Users can quickly and easily modify their dashboard’s focus to prioritize their data points
- Analytics can be organized by week, month, quarter, annually, or year-over-year
- Download reports into popular formats (e.g., CSV, PDF, JPG, PNG) for easy sharing across departments
Example of ZAGENO’s real-time spend dashboard
Spend visibility as a form of competitive advantage
It’s strange to think of something as dry as spend visibility as a competitive advantage, but, when done right, it truly is. By gaining transparency into where, when, and by whom money is spent, organizations can strategize in key areas such as cost reduction, cash management, accounts payable optimization, supply chain resilience, sustainability, and more.
Learn how you can answer any lab supply spend question in minutes with ZAGENO, the leading lab supply marketplace, featuring the industry's largest product portfolio, transparent pricing, consolidated invoicing, and real-time spend dashboard.
