The restaurant industry is a gigantic field constantly growing with innovations in food, service, design, and other elements that make up the dining experience. However, most players in the restaurant industry face a major challenge.
Despite the significant inflation in other industries, food and beverage prices have increased so little, and customers are not crazy about major surges in food prices. That’s why many have turned to different solutions, one of them being strategic sourcing.
In this article, we’ll briefly explain how players in this space can use strategic sourcing to gain the upper hand.
Balancing Prices & Margins
It is obvious that enterprises in the food and beverage industries have difficulties in being profitable. Making matters worse, the prices of raw materials needed in the manufacture of food and beverages are constantly fluctuating.
That’s why businesses in the restaurant industry are under significant pressure to cut costs while increasing profitability. How can they do that? The procurement department. Procurement departments are viewed as the key to victory, and strategic sourcing is the most powerful weapon in their arsenal.
Using an e-procurement solution helps them continuously monitor all data and make calculated decisions that help them recruit the right suppliers, not overload the inventory, and maintain healthy margins.
Finding the Right Suppliers
Efficient procurement management is a vital component of strategic sourcing. When utilizing numerous systems, achieving this goal is impossible. The ability to monitor and manage conversations and messaging while consolidating all supplier data in a specific system is a significant win.
This allows the procurement staff to successfully manage their relationships while also assisting the suppliers in having a better relationship with the business. Having integrated and up-to-date supplier information also allows you to easily evaluate vendors based on merit, making decisions easier and less price-driven.
Strategic sourcing allows companies in the restaurant industry to act fast through the bidding process. A sudden spike in popularity can substantially drive the value of raw materials overnight. Taking too long to begin the process of jumping in without being properly prepared almost always results in overpaying. Strategic sourcing helps you avoid this very problem.
There are too many variables In the restaurant industry, which is why so many have trouble maintaining a balance between controlling prices and keeping healthy margins.
That’s why a reliable strategic sourcing solution like Penny’s could be the key to helping businesses gain the upper hand. Contact us right away to learn how we can transform your company and take you to the next level.