Whether it be food, drink, consumables or even energy, the amount of cash you spend on them isn’t fixed – as a % or as a cash value. And neither is the value that you derive from it. But if you’re paying too much, or not getting the best value from it no one will ever tell you.
To be certain you are buying well you first have to challenge the hundreds of assumptions your team makes in your business about the size and level of change within your menus, the specifications and shelf-life of the products you buy, sourcing and provenance needs, stock and order processes, the number of deliveries you receive, and the storage space you have. And that’s before you evaluate the level of pre-preparedness of every ingredient.
Only when you have sweat the detail of all these (and other) assumptions can you be ready to talk with potential suppliers to ensure optimised price, quality, service and distribution. Alongside of course sustainability needs and setting up robust processes to maintain cost, value, innovation and service levels. Selecting and contracting with the ideal suppliers requires skills, market knowledge and experience.
Following these two strategies enables many benefits, but they also deliver the ability to optimise labour cost, and create enhanced operational efficiency by making processes simpler and easier for everyone.
The prize for full optimisation is a big one as on average hospitality supply chains are around 9% sub-optimal, which is frequently 3% points of margin, or £300k per annum for a £10m business.
