Do You Value What You Buy?

Buying is a highly specialized job. Not just anyone can do it, many try.

Today's foodservice buyer must know not only a lot about the products he purchases, he must know the commodity markets, bid procedures, negotiating techniques, how proteins are processed, and the seasonal availability of all products (determines both price and quality).

The job involves planning, forecasting, organizing, and a good buyer never stops learning, always seeking to understand menu applications and to update knowledge. The lost technique of value analysis can improve your product selections and bottom-line profits.

The idea is to precisely define menu and purchasing needs and buy products that best satisfy them. Value is based on quality and price and is often expressed in a business formula dating back to when I started in foodservice. (btw-fresh Dino wings were my favorite, usually ordered 14DN Choice Avisaurus!)

It's Your Money - Here's the Formula!
V = Q/P.    If the price (P) increases but quality (Q) doesn’t, value (V) is less. Of course, if Q increases but P does not, then V increases. The idea is that it’s important to judge value and you can’t do that if you don’t recognize value. You can learn to judge value by keeping records, checking the dumpster, consulting with peers, actually talking to waite staff and of course consulting with the operations and culinary group.

Value analysis can be product yield or case pack weight; for example, maybe you are not selling enough chili to warrant buying a #10 can, which means changing to a #303 at a slightly higher price, represents a better value.

Do you always require #1 tomatoes for back of the house prep/recipe items? Have you compared pickle slice counts (yield) from distributor label and brand products?  Are you paying off your juice machine, custard maker, waffle irons, roll-towels dispensers and coffee equipment by adding to the price of the product?. Do the math and you may find that a one-time capital investment in equipment makes more sense.

Our consulting work with the non-appropriate funds, shared services  military group in San Antonio proved there is a distinct savings advantage when buying proteins to eliminate bulk, weight, and waste.We moved from carcass and wholesale beef cuts (sub-primal) to boneless, well-trimmed meat, separated to meet specific cooking needs. Remember to neogitate bi-product credits for your purchase with the supplier.

The lost art of using value analysis and technical purchasing can improve product selections and back-of-the house efficiency. It’s true that the process can really occupy more time than operations or culinary staff can devout.  That’s why you should allow your purchasing staff the time to bring a systematic "value" approach to your business.

To Higher Profits!
Fred

Fred Favole is Founder & President of Strategic Purchasing Services, a firm specializing in chain & group purchasing outsourcing, staff support, distribution bids and strategic product development. He can be reached at: P: 912.634.0030, email: favole@gate.net or Follow Fred's Blog at: htts://purchasinginsights.blogspot.com

Take The "Farm to Fork" Truth Pledge

Restaurant customers are interested in knowing where their food comes from, with an emphasis on allergens, product purity and origin tracking. They ask your staff everyday,

“ What’s in your food ? ”

SPS' mission is to become the leader in purchasing outsourcing and support to emerging chains by going beyond the typical savings and supply efficiency model.

We pledge a “farm to fork” food transparency for the products and ingredients that we purchase throughout the global supply-chain.

I believe that my profession (foodservice purchasing) is responsible to the culinary team, investors, owners, management and to the customer. That we are called to do more than manage food safety scares and chase distributor case credits for defective products.

Join us by declaring that everyone in the supply-chain must respond to the customers desire to know what they are being served. Take the "farm to fork" pledge today and pass it along!

To Truth in Food & Ingredients !

Fred

Fred Favole is Founder & President of Strategic Purchasing Services (SPS) a firm specializing in purchasing department outsourcing, product development and distribution program audits. Contact: P: 912-634-0030, email: ffavole@gmail.com

Fight The Court Ruling - add foodservice purchasing skills

When working in foodservice chain procurement there are a few different skills that you should have to survive amidst the changing work environment. There’s nothing simple when it comes to change that affects you, and now that times are harder, your failure to secure new skills, on your own, can be taxing and without appeal, 'cause you may have to leave the industry after going before the courts.

- negotiation skills you need to expand your card scan file with new vendor contacts and improve your negotiation skills with business units within your organization. Remember, when the next wave of downsizing hits, every Concept Development Officer, VP of F&B and tenured Executive Chef will think they can take over the purchasing function by "multi-tasking" to greatness!

Your playing field is the court of superintendence, where accomplishments can only be second guessed, if they are not documented.

- communication skills you need to know how to build and manage relationships and be clear in your communications, or the articulation bug will stop "buck-naked" on your desk. The new foodservice work environment, in my opinion, seems to be about people taking credit for others accomplishments.

If you can actually get an executive to make a decision, you cover your tail, because if anything does go wrong, you will face the court of presupposition (aka "second guessing")

-organizational skills – you already need to follow food commodity markets, contract expiration dates, and critical product inventory. Now you must expand your skills and track distributor price-compliance, the price change impact on line item profits, and remember to keep a cost savings log!

The plain fact is you set the boss’s expectation bar too high by doing a great job, while others who contribute nothing have more face time and more influence. This forces you to prove your worth in the vulgar court of opinion.

If you are not strong in all of these areas go out and strengthen your individual skills so you don’t get blind sided by court decisions that tax your ability to work on skills, while subordinating your right to deliver great performance. .

To Higher Profits!
Fred

Fred Favole is Founder & President of Strategic Purchasing Services (SPS), America's most experienced consulting firm specializing in purchasing department outsourcing and cost-reduction services for foodservice organizations. Contact Information: P. 912.634.0030 email: favole@gate.net