by martieLast Updated : Sep-04-2023
Drug development involves many complex steps; Lab procurement should not be one of them. If you struggle with managing purchase orders in spreadsheets, then lab procurement software can help.
If you have a lab and you are purchasing equipment and supplies from different vendors, you are probably experiencing the following:
If you are experiencing any of the above and struggle with too much cost of lab inventory, this article is for you.
In this article, we will cover:
Let’s get started.
A lab procurement software is a purchasing system that automates the purchasing process for lab equipment and supplies.
This lab inventory management system empowers lab personnel to effortlessly manage the entire procurement lifecycle, from requisition to purchase order and receipt of supplies. It offers real-time visibility into inventory levels, vendor information, and pricing, enabling informed decisions that align with research objectives and budget constraints. Furthermore, lab procurement software often integrates with existing systems, enhancing collaboration and reducing the risk of errors.
What lab procurement software, you can achieve the following:
Lab procurement is the steps followed by the scientist and other research members to purchase equipment and supplies for the lab.
This cloud-based solution typically involves the following steps:
We have worked with many life sciences and biotech companies, and here are the top challenges that we see with the lab procurement process that does not have a streamlined procurement solution:
The manual purchase approval process is often rooted in the traditional organizational structure, where decisions require input and authorization from multiple departments or individuals.
As a result, the procurement process can become convoluted and time-consuming. Streamlined approvals are often communicated through emails, paper forms, or in-person meetings, leading to potential miscommunication, delays, and administrative overhead.
The challenge of incorrect pricing or part information stems from the lack of a unified and updated system for product catalog management.
When there is no centralized repository for accurate product specifications, vendors may provide inconsistent information or outdated pricing.
Moreover, manual data entry and communication can introduce errors, further complicating the procurement process that does not leverage an all-in-one procurement software.
Manual tracking of orders results from fragmented communication and inadequate visibility into the supply chain.
When labs deal with numerous suppliers without streamlining the entire procurement process, each with its timeline and method of communication, tracking the progress of orders becomes a complex task.
Without real-time updates on order statuses, laboratories are vulnerable to disruptions in research schedules and resource allocation.
Now, let’s talk about the key features of lab procurement software
Purchase requisitions are the first step in the procurement process. A scientist submits a request for purchase using a web form or email.
The purchase request is approved, and a lab manager or accounting team creates the purchase order and sends it to the vendor.
There are two challenges with this process:
A lab procurement software like ProcureDesk solves both of these problems.
Let’s see how a purchase request process is automated using procurement software.
First, there is no need to copy data from multiple websites and put that in a spreadsheet.
All you need to do is log in to your procurement system and click on the vendor’s logo.
The system takes you to the vendor’s website. You are already authenticated, so the vendor’s website has your details, including special pricing.
All you have to do is select your purchase, add it to the cart, and click a button to return the data to your procurement system.
Here is an example of how it looks:
The data is automatically sent back to the procurement system, and a requisition is created for you.
There is no need to copy any data manually.
You can, of course, add products or services from different vendors in the same request.
Here is a sample request:
Now, there are cases where a vendor doesn’t have a website. In that case, you create a catalog from which you can easily select the items for purchase.
Here is an example of that:
And if there is no catalog, let’s say one-time purchase – you can enter the data directly into the request.
Purchase requests are super easy with lab procurement software.
The other challenge with requisitions is approvals. There are two problems with approvals:
Lab procurement software solves both of these problems for common lab environments. Here is how:
First, the approvals are generated automatically based on a predefined set of rules. Your lab manager or finance team can define the approval rules in the system.
Once the approvals are set up, the all-in-one inventory management software does the rest and automatically creates the approvals for you.
The most common scenarios for approvals are based on the approval amount, chart of accounts, department, and so on. No matter what your workflow is, most purchasing systems should easily accommodate that.
Here is how approvals are generated in ProcureDesk:
The requesters can easily see who will approve their request before submitting it for approval.
Next is the problem of approval requests falling through the cracks.
This is solved in two ways:
Here is an example of approvals using the mobile app.
Mobile app for approvals
Finance teams are always concerned about budgets and ensuring that teams don’t go over budget.
There are two challenges that the teams face:
These challenges are solved using procurement software.
Here is how it is done:
The finance team configures the budget in the system, or the system can import the budget from your accounting system.
When creating the purchase request, the requester is asked to select the budget or the budget can be automatically assigned based on the chart of accounts.
Here is how it works in ProcureDesk:
If no budget is available, finance teams can configure controls on what to do. Here are your options:
Now that you have budget availability – the requester can proceed with the approvals.
The lab manager or CSO(Chief Science Officer) approving the purchase can easily see the budget available at the time of approval.
Here is what it looks like:
A challenge with manual purchase orders is that you must create and send purchase orders to the vendors.
Imagine if you don’t have to create a purchase order in a spreadsheet, print it out, and send it to the vendor. How much time will that save?
That is where lab procurement software can help reduce the time spent processing purchase orders.
When a purchase request is approved, the system automatically generates the purchase order and sends it to the vendor.
Depending on the vendor’s capabilities, you can send the purchase order electronically or through email.
Most procurement systems punch out orders, making sending and tracking purchase orders easier.
It also makes it easier for the vendor to receive the purchase order.
Here is an example of a purchase order:
Do you feel that the purchase orders are going into a black hole after you send the purchase order
to the vendor?
Do you have to continuously follow up with the vendor to track the status of the purchase order?
If you said yes to any of the above questions, then lab procurement software with tracking capabilities can help.
Here are a couple of scenarios where an order tracking capabilities can help you:
With order acknowledgment, you can ensure the vendor has received the purchase order, and it allows the vendor to provide specific details about what line items they can ship, what are back-ordered, and what are the expected delivery dates.
This allows you to stay on top of deliveries and manage expectations for your stakeholders accordingly.
Here is an example of an order acknowledgment from the vendor:
Purchase order acknowledgmentHere, you can see the promised ship dates and the shipping lines on what dates.
ASN (Advance Shipping Notice)
Do you want to be notified when the vendor ships the product?
Do you want to track the exact status of where your product is?
This is where an ASN can help. The vendor sends An advance shipping notice to the buyer when the product is shipped. This generally contains the tracking number and what items are being shipped.
Here is an example of that:
With a system like ProcureDesk, you can automatically receive these notifications from vendors, and you don’t have to keep track of this in a spreadsheet manually.
Once the tracking information is received, the system automatically tracks the delivery information and informs the lab team.
Worried about running out of lab supplies?
Or you might be concerned about bulging inventory because you carry too much in stock.
In either case, an inventory management system can help. ProcureDesk lab procurement system has an inventory module that helps you with the following:
Here is an overview of the inventory in ProcureDesk:
ProcureDesk Inventory Module
Biotech finance teams and scientists often grapple with the intricacies of managing a seamless procurement process.
One key challenge they face is ensuring that purchase orders, goods received, and invoices align perfectly. This 3-way matching process, when done manually, is not only time-consuming but also prone to human error.
Moreover, the need to store physical packaging information for record-keeping and verification purposes can further clutter already crowded lab spaces and create organizational inefficiencies.
ProcureDesk’s 3-way matching process offers a robust solution to these pain points.
Automating the verification of purchase orders, receipts of goods, and invoices minimizes discrepancies and manual oversight.
For biotech finance teams, this means a streamlined workflow, reduced chances of financial errors, and timely vendor payments. For scientists, automation translates to an efficient use of resources, as there’s no need to retain and sift through physical packaging details.
Here is what you can expect from a procurement management software solutions:
Here is an example of an automated 3-way match process in ProcureDesk:
Dashboard: Invoice matching
Without integrating with your accounting system, you must create the same invoice in two different systems. This is time-consuming and frustrating for many teams.
With integrated lab procurement software, the data is automatically synced between the procurement software and your accounting system.
Once the invoice is approved for payment after the 3-way match process, the invoice is automatically created in your accounting system along with the actual invoice document.
Keeping master data like the Chart of Accounts and supplier information consistent across platforms can be daunting. The system automates this synchronization.
Whenever there’s an update or change in the Chart of Accounts or supplier data in the accounting system, ProcureDesk automatically reflects these changes in real time. This ensures that the AP teams always work with the most up-to-date information, further streamlining operations and reducing discrepancies.
So, how do you justify investment in lab procurement software? Here are some key benefits:
Measurement: Time Saved on Administrative Tasks
Lab procurement software automates administrative tasks. The software drastically reduces manual intervention by automating purchase requisitions, approval workflows, and order generation, leading to significant time savings.
How to Measure:
Calculate the average time spent on administrative tasks related to procurement before and after implementing the software. This includes time spent on filling out forms, seeking approvals, and processing orders. Multiply the time saved per procurement cycle by the number of procurement cycles within a specified time frame.
Measurement: Error Reduction Rate
The software’s centralized catalog management ensures that accurate product information is readily available, mitigating the risks of wrong pricing or part specifications. This enhancement in data accuracy minimizes confusion, errors, and costly discrepancies.
How to Measure:
Compare the number of errors related to incorrect pricing or part information before and after adopting the software. Calculate the percentage reduction in errors to quantify the improvement in data integrity.
Measurement: Reduced Downtime Due to Order Delays
Real-time order tracking provides enhanced visibility into the progress of orders, minimizing downtime caused by delivery delays and disruptions to research schedules.
How to Measure:
Assess the average downtime experienced due to order delays before the software implementation and compare it to the downtime after implementing the software. This comparison yields a clear quantitative measure of the reduction in disruptions.
Measurement: Vendor Performance Improvement
Efficient vendor management tools facilitate collaboration and enable data-driven decisions. Improved vendor performance translates to reliable deliveries and enhanced product quality.
How to Measure:
Evaluate key vendor performance metrics such as on-time delivery rates and product quality before and after using the software. Calculate the percentage improvement in these metrics to demonstrate the software’s impact on vendor management.
By measuring these benefits using specific metrics and calculations, you can showcase the tangible impact of lab procurement software on your laboratory’s operations. When paired with qualitative feedback from scientists and lab managers, this quantitative analysis paints a comprehensive picture of the software’s value proposition and its potential to revolutionize your procurement processes.
Ready to move forward with selecting a lab procurement system? Here are the recommended next steps:
By focusing on these five steps, you can efficiently select lab procurement software that optimizes processes and productivity while aligning with your laboratory’s specific requirements.
Buying supplies and tools quickly and correctly in today’s labs is crucial. Lab procurement software helps make this buying process smooth and mistake-free.
Labs can save time and reduce errors by using tech to help with matching orders and payments. These programs can also talk to other systems, like accounting software, which means less manual work and fewer mistakes.
As labs grow and change, having good software to manage purchases will become even more important. In short, lab procurement software helps labs focus on their main job: doing great research and making discoveries. And above all, it brings labs a better ecosystem for purchasing needs.
What you should do now
Whenever you’re ready… here are 4 ways we can help you scale your purchasing and Accounts payable process.