Follow these simple steps to learn how a smooth procurement process can be key to the success of your hospitality business.
Efficient procurement is essential for any hospitality business, whether you run a small snack bar or a renowned 5-star restaurant.
In this article, we will show you how to ensure a smooth procurement process in your company in 6 easy steps.
Hospitality procurement is a complex and critical function for any foodservice business. The primary goals are to maintain optimal inventory levels, reduce costs, save time, and build profitable supplier relationships.
At its core, the procurement process is about acquiring the goods and services needed by hospitality businesses. This includes everything from fresh ingredients and beverages to cleaning supplies and equipment.
An efficient procurement process ensures that your business runs smoothly and meets the needs of your customers.
Step 1: Identify your needsBefore placing an order, it is critical to understand your company's specific procurement needs. Determining these needs lays the foundation for efficient inventory management, helping you avoid both shortages and overstocks.
Here are four effective ways to determine them:
Analyze your menu and sales
Start by taking a close look at your menu and sales data to find out which dishes are most popular and which ingredients are in regular demand. In addition, look for trends that cause sales to fluctuate, as these insights can help you better anticipate your needs and adjust orders accordingly.
Consider seasonality
It is also important to include seasonal variations in your demand analysis. Plan for specific items, such as asparagus in the spring or squash in the fall, to ensure that you always have high-quality, seasonal ingredients available.
Include events
Of course, your needs analysis should also consider planned events. For example, do you have company parties or holidays coming up? Include these events in your considerations to identify and meet additional demand in a timely manner.
Use ERP systems
Digital ERP systems can also greatly improve your procurement process by helping you identify your needs. These systems allow you to control and monitor your inventory levels in real time, providing accurate information on which products need to be reordered.
In addition, connecting your ERP system to your point-of-sale system ensures a seamless transition from purchasing to sales, with orders automatically recorded and your inventory updated accordingly.
The second step in an efficient sourcing process is to evaluate and select the best suppliers to meet your identified needs.
Whether you're sourcing from wholesalers or local markets, it's important to develop a comprehensive understanding of the different suppliers that can meet your quality and demand requirements.
Choosing the right supplier is a critical decision in the sourcing process. In addition to quality and price, you should consider factors such as product range, terms and conditions, delivery reliability, and the supplier's reputation in the industry.
Again, modern solutions such as digital ordering systems simplify procurement by allowing you to centrally manage all your food suppliers.
Once you have selected suitable suppliers and reviewed their quotes, the next step is to place your orders.
This is where digital ordering platforms come in. They allow you to manage all your orders in one place and place them directly with your suppliers.
In addition, digital ordering platforms offer special features such as assortment restrictions that ensure you only order what you really need, eliminating unnecessary purchases and reducing waste. Authorization controls can limit who can place orders, ensuring that only authorized personnel make sourcing decisions, helping to maintain consistency and control. By standardizing the ordering process across all operations, you can minimize errors, incorrect orders, empty shelves, and food waste.
Implementing clear purchasing policies and guidelines is also critical to a smooth ordering process. Designate specific days for ordering from different vendors to streamline the process and ensure timely deliveries. For example, order produce on Mondays and Wednesdays and beverages on Thursdays. Coordinate deliveries to best meet your business needs.
Once you have placed your order and your new products have arrived, it is important to carefully check them for completeness and quality. This will ensure that only perfect food reaches your kitchen and that the quality meets your standards.
Also, keep detailed records of what goods arrived, at what time, and at what actual and target temperatures. This documentation is especially important in the event of a faulty shipment so that you can immediately communicate the problem to your supplier.
After receiving your goods, proper storage of delivered food is critical to maintaining its quality and safety. Ensure that refrigerated and frozen items are immediately placed in their respective storage units to prevent spoilage and maintain food safety standards. Also, separate clean food from unclean items to prevent cross-contamination.
It is also important to conduct a regular inventory to record all existing food and beverage supplies. This will help you keep track of your inventory, identify shortages, and reduce food waste.
Once your goods have been properly stored, it is time to carefully review the invoices you have received. Compare the quantities and prices delivered with the purchase orders to identify any errors or discrepancies. This will help you avoid duplicate invoices or missing amounts.
After you review and approve invoices, pay them according to the agreed-upon payment terms. And always make sure that payments are made on time – this not only promotes good business relations with your suppliers, but can also bring financial benefits such as discounts.
Successful hospitality procurement is more than just purchasing goods – it is a strategic process designed to ensure the smooth operation of your business.
From identifying your needs, to auditing, each step plays an important role in ensuring quality, controlling costs, and efficiently managing resources across your organization. Digital solutions also provide valuable support throughout the procurement process by creating transparency and optimizing processes.
Only by streamlining procurement can restaurateurs ensure the long-term success of their business and meet the growing expectations of their guests.
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