Thread by @EmoryChanNano

Quite a few people ask me about buying large automated systems and other high value equipment ($250k - $millions). Here's a thread with my top 10 tips for large equipment purchases:

Here's the summary if you don't like reading:
1. Do a live demo
2. Talk to current users
3. Build relationships with vendors early. Find people you trust.
4. Don't try to make everyone happy.
5. Before talking to vendors, write an RFP w/ acceptance tests

6. Never tell the vendor your budget
7. Only negotiate with decision makers
8. Only pay $$$ when you are totally happy. Don't pay up front.
9. Learn how to read a contact. Structure your contract to avoid problems down the road.
10. Budget for facilities reno & service contracts

Here's the long version:

(Caveat: talk to your procurement officer & follow all contracting rules!)

1. Travel to the vendor and test your process on their equipment. Insist on a live demo, not just data/video. Live allows you to build relationships with staff & allows you to spot red flags like buggy software. Traveling for demos is cheap insurance for your $$$ purchase.

2. Talk to users who own the same or similar equipment. The vendor references may be biased, but they are good for getting leads to less skewed refs. People will be more frank talking in person than via email. If possible, go visit these people!

3. Big purchases are always about relationships, so build relationships early. Go to conferences & vendor events to meet in person, well before you even apply for funding. Find the person (salesperson, engineer) that you trust, can work with, and will work their tail off for you.

➡️In some companies, a salesperson will have to go to bat for you to get approval for a big contract, especially for a good deal or highly customized build. When builds go awry, your trusted counterpart is going to be the one you call to crack skulls & get things back on track.

👆To build the relationship, get the vendor excited about the science. Make them believe that your research is going to show everyone in the world how awesome that vendor's equipment is.

4. Get feedback from potential users, but don't try to make everyone happy. You'll get an instrument that does everything poorly & out of budget. Instead, think about the ONE paper that you want to write based on your instrument.

👆If you're the PI/postdoc/student in charge of this instrument, then that paper should be YOURS. Then make sure the instrument has the specs that will make this paper happen.

5. Before soliciting bids, write a Request for Proposals (RFP) that has all critical specs you need (like for your paper! Importantly, include a Factory Acceptance Test (FAT) and a Site Acceptance Test (SAT).

👆These are tests that show that the instrument does exactly what you want it to do before it leaves the factory (FAT) and before you sign off on the final install (SAT). FAT/SAT are incredibly important and should be used as milestones for the vast majority of the payment.

➡️ RFP, FAT, and SAT should be very specific -- make sure to include who, what, when, and where things are done. Don't use passive voice! e.g., instead of saying, "oleic acid will be added to the plate," say...

"An automated script will direct the 100 ul pipetting module to transfer 50 ul of oleic acid into wells A1-A12 of a 96 well plate provided by [you]. The acceptance criterion is met if oleic acid in the 12 wells falls w/in 5 ul of the target as measured by hand gravimetrically."

➡️It's important that vendors know how they will be judged before they place their bids. You want to avoid adding requirements deep into contracting. Vendors will be like "of course we can do that.... it will just cost you extra, mwahahaha."

6. Never ever tell the salesperson your budget. Doing so kills your leverage & can violate institutional/gov't contracting rules. Vendors use this info to charge you whatever they can get away with. #ProTip: Don't do sole source contracts!!!

7. Figure out who the decision makers are on your side and the company's side. When it's time to really negotiate, get the decision-makers all in the same room; otherwise you are wasting your time.

👆If decision-makers have delegated their authority, then have those people establish that in writing. e.g., have your boss write an email to everyone saying you the boss. CC: the important people to keep them in the loop.

8. Structure your contract so that most of the money is paid when the vendor passes the SAT and you are 100% happy. You lose all leverage once you give the vendor your money. Don't pay $$$$ up front!

👆Vendors will tell you it is "company policy" for you to pay 100% / 50% up front. That's BS. You will get burned if you agree to this. If the vendor won't agree to 100% payment on site acceptance, negotiate a reasonable milestone schedule w/ big chunks for passing FAT & SAT.

9. Learn how to read a contract. Don't trust your procurement officer to do this. It's not their money/career on the line. You want the contract to make your life as easy as possible so you can worry about science. Maximize your leverage on things that really count, like SAT.

👆The most important thing I learned about contracts: In reality, a company doesn't have to do everything in a contract they signed. If they don't feel like doing something, the vendor will just not do it. You see this all the time, w/ Elon Musk & Twitter, & NBA players (KD/AD).

👆Companies can just say "I don't want to do that. So sue us." And they're right: your only recourse is to either: (1) invalidate the contract, and lose all the time & money you already spent, or...

👆...(2) spend a bunch of time and money to sue the company to perform work they don't think they can do anyway. This almost always ends up in an unsatisfying settlement.

➡️You don't want any part of scenarios (1) or (2), so make sure you: Have a healthy relationship with a company & back it up with contract that has early milestones that allow you to bail early on, and make the bulk of the payment tied to the FAT & SAT.

10. Make sure to budget for facilities renovations and service contracts. Get the room requirements (power, space, vibrations, etc) and service contract prices before you sign off on the contracts.

👆...these costs can be a significant fraction of the cost of the equipment, and it's easy to overlook them. It's stunning how many pieces of broken equipment sit around unused because a PI couldn't afford the service contract.

TL;DR: Big equipment purchases are all about maintaining good relationships and maximum leverage. Any time you give up leverage (i.e., making a big milestone payment), make sure you are 100% happy. Because it's going to be much harder to get the vendor to do anything afterwards.