There is little doubt that if you put enough effort into it, you will be able to find someone willing to sell or make a product at a lower price. But is the reward worth the effort?
The opposite of vendor consolidation is vendor proliferation which is often encountered by those who adopt the open competition model. What is the cost of issuing so many P.O.'s and writing checks to a host of vendors? Many labs grossly underestimate these costs!
There are two types of people - those who love to haggle and those who hate it. If you love to haggle / bargain, you can only reduce costs and not generate revenue. Is it the best use of your time? Really?
Are there ethical lines crossed in the quest for the best deal?
How much market knowledge do you have? Do you really know what is a good deal? Do you rely on Google to find new vendors?
Is this your hat?
As a lab manager, I doubt that many would wear this hat in the lab. However there are a select group of lab managers who just love to find (and brag about) the low price they found on an item. Used, refurbished, demo, whatever it takes! For those who ONLY care about price, the reverse auction may be the ultimate tool. (Reverse auctions have fallen out of favor because they just don't work.)
For most people, haggling is not just unpleasant, it is a huge waste of time. Who hasn't bought something online and found out that the "shipping and handling" (or other hidden fees) erased the savings. With all of this, there is one undeniable fact. If you want the absolute lowest price on an item you have to drive a hard bargain with your suppliers.
This method requires that you have the following:
- Product knowledge - you know what the products are, their technical specifications, what defines a quality product.
- Market knowledge - you know who makes the product, who distributes the product, and the supply chain.
- Pricing knowledge - you know when to stop haggling because you have reached a price where further time spent is wasted.
Amazon and Google have given hope to the bargain hunter who now perceive that a bargain is just a few clicks away. If it were this easy, why don't more people do it this way? Why would anyone need help from a sales rep? Who would need a lab supplies distributor?