Questions Procurement Should Ask Before Signing a Lab Services Contract


After the expense of personnel in the lab, the acquisition and care of the instruments is the next highest cost. Laboratory instruments are growing increasingly sophisticated and complex as they leverage the Cloud, the Internet of Things (IoT), artificial intelligence, and machine learning. As labs become digital enterprises, it’s important for managers to glean insights from the data being provided and gain a holistic view of their operations. How can they see the big picture, think strategically, and align operations with how the C-suite runs the overall business? Choosing the best partner for laboratory services is a critical step in this alignment. Before signing a contract for laboratory services, here are some forward-thinking questions procurement should ask:

Q: What services can and should be part of a lab services contract?

A: The temptation is to focus on instrument uptime and productivity, which emphasizes preventive maintenance contracts and agreements for response times when something, inevitably, breaks down. But lab services can be far more extensive than just instrument care. And they must be, because the lab is changing. Ask vendors for their capabilities in increasing researcher productivity and scientific throughput as well as asset productivity. This may require services such as:

  • Consulting
  • Compliance
  • Scientific support
  • Laboratory relocation
  • Advanced analytics and interactive dashboards to:
    • Optimize service spend
    • Inform capital asset purchasing
  • Benchmarking analysis such as:
    • Response time
    • Downtime
    • Resolution on first call
    • Repeat calls
  • IoT instrument and lab environment monitoring applications
  • Service requests via mobile application
  • Instrument location RFID
  • Training
  • Information services
  • Modern capabilities for the care, service, repair, and maintenance of instrumentation.

These services can be the difference between working with a supplier vs. having a partner.

Q: What is the difference between a partner and supplier?

A: Very often, a supplier relationship is described as 1:1, while a partnership is when 1+1=3. Suppliers deliver a valuable service, but partners add additional value by working with your organization to deliver on current needs, prepare for future demands, and strategize around solutions. Partners don't just complete tasks; they are accountable for results. Overall, partners take a comprehensive view of your organization and its objectives, evaluate where their services fit, and determine how their experience and expertise can make improvements you may not have envisioned. For example, partners access your organization’s lab instrument performance data and benchmark it against data based on their experience in the industry to make recommendations to improve your lab operations. Partners with scientific expertise will know that an important goal is to return science time to scientists, to increase scientific productivity, and to collaborate for scientific outcomes. A partner with a solid foundation in compliance, for example, will work with solutions to maintain or be proactive in achieving a compliant environment.

Q: Should I choose one vendor for each service, or one partner for all the services needed?

A: Individual vendors can bring a certain level of niche expertise to the table, but selecting a full-service provider who can deliver many of the services required under a single contract is beneficial in several ways:

  • Communication, management, and relationships are consolidated and simplified. With a single point of contact, your lab personnel will know exactly who to call.
  • One partner is responsible for the outcome, meaning there can be no finger-pointing between multiple vendors and, instead, quicker problem solving.
  • Partners take a holistic view of your organization’s laboratory operations, enabling scientists to use data, expertise, and experience to make informed recommendations. This integrated approach gives greater visibility to opportunities for better productivity and greater efficiencies.

Q: Why choose a provider who can service many of the instrument brands in our labs vs. OEM contracts with individual instrument manufacturers?

A: A multiservice vendor can service a variety of instrument types and models from most of the top lab asset manufacturers. Look for a vendor with the skills, expertise, and capabilities to service this broad range, as well as the available resources, technology platform, and commitment to training and to keeping up with the rapid pace of technological change. Working with a partner who understands all the assets and processes in the lab and how they work together allows for a more holistic view of how efficient your organization’s lab is running. They are not focused on just one component of the lab, but the lab as a whole.

Q: What factors should I consider besides cost?

A: The cost of services is an important factor, but only one among many criteria that should be considered. Additional factors include:

  • Response time
  • Your strategic direction
  • Your budgetary constraints
  • Your company’s evolution
  • Scalability and flexibility of the service provider to meet your current and future needs

Providers can price and deliver services very differently; be sure you’re making an equivalent comparison. A lower-priced option may not cover exactly what your organization’s lab needs, so you will end up paying more in the long run. More importantly, determine the value of the services’ return on investment as you evaluate the quality. Lower-cost options can ultimately provide a lesser quality product or service.

Q: How do I measure the value of the services, and know whether upfront costs are going to translate into lab productivity savings?

A: While there will be certain tangible savings that are more easily measured — for example, asset productivity gains and increased scientific throughput — other advantages will be more difficult to quantify, yet easy to feel. How do you compare the hidden costs of negotiating and managing multiple outsourcing contracts to simplifying with fewer partners, perhaps even one? What’s the value when a vendor helps to shift capital expenses into the operational column? With effort, these softer savings can be identified. For example, when you can optimally manage lab assets, you can funnel capital expense savings that contribute to driving research forward.

A good service partner can assist you in identifying hidden costs, cost avoidance, and projected savings to determine an accurate Total Cost of Ownership, and help you build a business case to take to upper management. In addition, a valuable partner’s reporting throughout the engagement will reveal savings, as well as new opportunities for cost efficiencies.

Q: How can I determine if the vendor has sufficient experience to meet my organization’s needs?

A: Ask for examples of insights, recommendations, and intelligence they have brought to clients to improve performance. This can include recommendations for fleet rightsizing, analyzing asset types for utilization, or optimizing process flow or equipment service spending. Check references and talk with industry peers to understand your potential partner’s reputation. A vendor’s experience can shorten downtime on service and return instrumentation back to the laboratory and to scientists sooner. Experienced vendors will make understanding your business their business. Being preemptive and proactive with asset management, for example, will increase productivity for your organization’s lab space by ensuring compliance, service, and support.

Q: How can I take advantage of economies of scale?

A: A true service partner with comprehensive coverage and global support lets you consolidate vendors that can deliver volume as well as productivity savings. Engaging with multiple parts of your organization lets a partner draw on even greater visibility to make recommendations for improvements. Likewise, they have the ability to leverage technology solutions to provide insight and productivity advantages to your enterprise.

Q: What should I know about compliance service offerings before signing a contract?

A: Not all compliance programs are alike; it’s important to understand exactly what they are promising to do for you — and what they aren’t. Compliance services can range from basic instrument qualification to computer system validation and data integrity, to specific consultative services around regulatory affairs or quality assurance. Make sure the supplier has the experience with staff to support your compliance needs. Knowing their background and capabilities will help you understand how efficiency may be brought to projects, for example, by utilizing subject matter experts in the field and not relying on your scientists to squeeze the work into their busy schedules. A compliance partner who understands validation; chemistry, manufacturing, and controls (CMC); and other pipelines; and who can assign projects and impose deadlines, is critical to getting your products to market. Being able to quickly kick off projects and complete them without the need to have you recruit, hire, and train is a time- and cost-saving benefit.

Q: What about growth? Can the service provider support what you might need tomorrow?

A: Understanding your partner’s ability to grow with you and support your growth, is an important part of the selection criteria and your relationship going forward. Service partners should have a forward-thinking mindset and a business plan that prepares itself — and you — for the lab of the future. Look for providers who are aware of the changing nature of labs and preparing for connected instruments, connected labs, connected researchers, and remote access and repair. Is the vendor thinking of the downstream consumption of connected data from the Internet-of-Lab-Things? Are they using current innovations such as remote service capabilities, or preparing for emerging ones such as augmented reality technicians? As the lab changes, it is not acceptable for service partners to simply maintain their current offerings. Look for a partner who is thinking about how your lab is changing, and can advise and guide your planning and operations based on a comprehensive view of your organization and their own experience.