The success of your hotel is riding on the health of your supply chain. A stable supply chain consists of reliable vendors, predictable pricing, and streamlined purchasing processes. It’s a good idea to do a periodic checkup of your supply chain to evaluate your performance. Taking the time to review your supply chain at least a couple times a year can help you lower your annual expenses and fix issues in your purchasing system before a problem arises. Here are three steps you need to take when performing your supply chain checkup:
Step 1 – Audit Your Expenses
The first step in your supply chain checkup is to audit the expense reports for all of your hospitality supplies. This is a good opportunity for your purchasing team to pinpoint money saving opportunities. Perhaps there are items in your food and beverage program that are not moving well that can be eliminated. Or maybe you’ve experienced a sharp price increase on an item you purchase frequently and it’s time to request bids from alternative suppliers. Leveraging your data to make smarter purchasing decisions can make a big difference in your monthly expenses.
Step 2 – Review Your Supply Chain Map
Make a map of your supply chain network. You may find that you’re procuring items from multiple companies that can be consolidated and ordered from a single supplier. Or perhaps you’re paying high shipping costs to an out-of-town supplier when a local alternative exists. This is also a good time to evaluate all of your suppliers and how they are performing.
Step 3 – Set KPIs to Track in the Future
Setting key performance indicators (KPIs) will better equip your purchasing team to monitor the health of your supply chain year-round. Some common KPIs to watch are pricing, inventory turnaround, and supplier lead times. In addition, you should track the number of negative incidents you experience with your suppliers such as late or incorrect deliveries and other quality control issues. Constantly monitoring KPIs will allow your purchasing team to make quick adjustments to your supply chain as needed. This will make it easier to mitigate risk and keep your budget on track.
Source1 Purchasing can be a valuable partner in maintaining a stable supply chain for your hotel, restaurant or other hospitality business. Find out how we can help you with supplier relationship management while saving you up to 15% on the cost of your hospitality supplies. Request your free Market Basket today.