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To all the core administrators out there -

I'm interested in hearing if anyone has tackled the puzzle of determining if it is beneficial to charge "less-than-direct-costs" to external users when you have excess capacity to fill in a shared research facility.  At what level of excess capacity does "subsidizing" external clients become beneficial, if at all?  The question comes up often enough that I've decided it is worth giving it some thought.  

Happy to discuss more offline with anyone interested.

All the best,
Julie

Dear Julie,

That's a great question and one we've been thinking about as well. At our facility, external users are welcome, but they usually pay the full internal rate plus 25% to cover overhead and prioritize internal use.

That said, if we're not reaching the desired internal capacity and utilization drops below ~70%, I think it's worth considering reduced rates. Especially if it helps build relationships, foster collaboration, attract future funding opportunities or, perhaps most importantly, increase visibility.

If you have specific expertise and available staff capacity, collaborations with vendors can also be a strategic option. For instance, testing new consumables with reimbursed staff and instrument time not only generates income but also strengthens relationships with vendors and keeps your facility at the forefront of innovation.

We haven't formalized a threshold yet, but I'd be very interested to hear if others have created clear models or decision frameworks around this.

Best,

Marjolijn

To all the core administrators out there -

I'm interested in hearing if anyone has tackled the puzzle of determining if it is beneficial to charge "less-than-direct-costs" to external users when you have excess capacity to fill in a shared research facility.  At what level of excess capacity does "subsidizing" external clients become beneficial, if at all?  The question comes up often enough that I've decided it is worth giving it some thought.  

Happy to discuss more offline with anyone interested.

All the best,
Julie

To all the core administrators out there -

I'm interested in hearing if anyone has tackled the puzzle of determining if it is beneficial to charge "less-than-direct-costs" to external users when you have excess capacity to fill in a shared research facility.  At what level of excess capacity does "subsidizing" external clients become beneficial, if at all?  The question comes up often enough that I've decided it is worth giving it some thought.  

Happy to discuss more offline with anyone interested.

All the best,
Julie

To all the core administrators out there -

I'm interested in hearing if anyone has tackled the puzzle of determining if it is beneficial to charge "less-than-direct-costs" to external users when you have excess capacity to fill in a shared research facility.  At what level of excess capacity does "subsidizing" external clients become beneficial, if at all?  The question comes up often enough that I've decided it is worth giving it some thought.  

Happy to discuss more offline with anyone interested.

All the best,
Julie

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Julie Auger
Executive Director, Research Operations
Salk Institute for Biological Studies
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