Food Purchasing Cost Control

Food Purchasing Cost ControlIn the hospitality industry, get may be defined as a consumption concerned with the search, selection, get, receipt, storage, and final use of a commodity in accordance with the catering form _or_ system of government of the establishment. (Davis and Kotas, 198647)Davis and Kotas (1986) suggest that acquire is a unsounded function in the crapulence control cycle. If this function is managed efficiently, whence all hotel back tooth attain timbre beverage products at the minimum approach possible fit in to the comp boths financial objectives.The objective of beverage bargain is to batten consume the beaver whole step of items, at the lowest expense for a limited purpose. It is a mustiness to give considerable attention to the beverage court control since beverages ordain normally throw in more earnings than food. Fewer staff is involve to process beverage into a spotless item for consumption by the customers comp atomic number 18 s to food. (Davis et al, 2008)3.2 The Purchasing PersonnelStaff members that be responsible for the beverage acquires vary depending on the type and sizing of the establishment. (Davis and Kotas, 1986)The buying carriage is responsible for the beverage buying function in Hotels unmatched and Two. In Hotel-Three the acquire coach and the food and beverage animal trainer are responsible for the beverage buying function whereas in Hotel-Four the acquire manager and the cost control are accountable for this function. In Hotel-Two when at that place is a special theme night, the food and beverage manager entrust trade union the purchasing manager for such occasions.The purchasing function is centralised as hotel purchasing for Hotels One and Four. On the some other hand the purchasing function is centralised as a group purchasing for Hotels Two and Three. It was hold by all the interviewed personnel that the purchasing personnel leave to be experienced and knowledgeable m ost the products that they have to severalise. In fact the purchasing manager in Hotel-Three has over thirty years of experience in this function. In the case of Hotel-Two it was mentivirtuosod that although experience and knowledge are vital for the purchasing function, most items in Malta are standard. Additionally it was also institutionaliseed bulge protrude that the purchasing function depends on the demand of other incisions. There have to be cross functional teams (that is team effort) and strong communication among all the hotel de scoretments.Standards for beverage purchasing are developed for all the four hotels interviewed. Quality is inclined primary priority in all the hotels interviewed apart from for Hotel-Two where the first discernment is on the cost. In the case of Hotel-One, the products have to satisfy the bar manager and afterwards the purchasing personnel get out deal for the take up price for the pre-established flavour. They testament try to obta in the best price at the best quality. In Hotel-Three the purchasing personnel leave try to attain a balance betwixt price and quality however Quality is on top of the agenda. It is essential to consider the leverage of some of beverage items of individually outlet separately. For example the wines ecstasyed at the pool bar leave alone be at a rase quality and at a lower price when compared to the main bar. Each product can have a good quality, very good quality or best quality. The purchasing personnel have to choose the quality that is adequate for the particularised outlet. In Hotel-Four both quality and price are addicted right of federal agency however quality leave always win. In Hotel-Two price is given precedence in the sense that, when choosing between cardinal products with similar quality but different prices, the purchasing personnel will go for the cheaper product.The quantities of beverages to be ordered are instructd by the storekeeper with the skilled a ssistantance of the purchasing manager using a par stock level. When required in Hotel-One the cost ascendency will help out to determine the quantities to be ordered. In Hotel-Three the food and beverage manager will assist when needed to determine such quantities.3.3 The Selection of SuppliersThe providers selected can be either existing providers or potential suppliers. The advantage of the existing suppliers is that the quality of the goods received, the price and the service offered would all be already known. According to Dopsen, hay and milling machine (2007) when dealing with new suppliers it is vital to exercise prudence and to get the ensuant information as a minimumFull details of the substantial and the range of items it is sellingCopies of recent price incliningsDetails of trading priceDetails of other customers they deal withSamples of products.Ideally there should be a visit to any potential supplier to enhance knowledge about the size of the company the range o f the products the size of processing and storage facilities and to affect members of the management team. All these factors facilitate a sustainable long-term handicraft relationship. (Dopsen, Hayes and Miller, 2007)Suppliers can be chosen on the basis of their temper in the foodstuff, upon an investigation of a supplier and on the basis of their performance. The best supplier is the one who provides the firm with the most efficient service with forecast to quantity, quality, price and actors line performance. (Davis and Kotas, 198653)In all the hotels except for Hotel-Four there is a list of agreed suppliers from whom products are bought. Hotel-One has a list of preferred suppliers from whom the purchasing personnel will buy continually. It is a preferred suppliers list sort of than an approved suppliers list. The advantage of having a preferred rather than an approved list is that if any particular supplier will give you a weighed down judgment of conviction (not reliabl e towards the hotel), then this supplier can be right off replaced. Hotel-Two has an approved supplier when it comes to soft drinks and beers. When it comes to spirits, the suppliers are preferred rather than approved.Hotel-Three has contracts with the suppliers containing pre-agreed prices and pre-agreed quality of the listed products, however if something will not vary for example the quality will deteriorate, the purchasing personnel will alter the supplier if the problems will not be tackled. Although there is a contract, it is not a fixed hint that is the hotel personnel are not obliged to buy the beverage products from the specific supplier. Hotel-Four does not have any suppliers list. In this hotel the suppliers are chosen according to the quality of the products, the type of brands required and the services that the supplier will offer to the hotel.When selecting the suppliers, the criteria evaluated by Hotel-One are credit term, quality and prices. The credit term trans mit is given top priority. According to Hotel-One it is useless to go for the best quality and the best price if the credit name period is terse. In Hotel-Two price is given top priority when selecting suppliers while quality and lead time are also analysed to make the right decision. In the other two hotels quality is the most influential factor used to determine the suppliers to be chosen for the beverage products.Dopsen, Hayes and Miller (2007) explained that the supplier performance can be evaluated using the rating system which usually includes price, quality and delivery performance. Potential suppliers performance is only evaluated by Hotel-Three. Every now and then the purchasing manager will pick some items and verify if there is a better product in the market than the one that the hotel is soon using. The purchasing manager without involving employees in operation will pick up different products and will make a blind presentation and taste perception of the product. Th e purchasing department will decant the product that will be identifiable (delete the tag and the supplier name) and the food and beverage manager will rate the product using a rating sheet including quality, yields among other factors. The person rating the product will not know who the supplier is.Although the decision taken will not be based on price, the food and beverage personnel will know the price to be able to match the product being tasted with its price accordingly. There have to be a balance between quality and price. It can be that the product quality is superior compared to the hotel standard thus the product will not be affordable. indeed the rating sheet is filled out.Hotel-One pointed out that the suppliers evaluation and performance is not prepared because this does not add any value on the hotel sales.The cheapest item is not automatically the best to buy since low-cost products can lead to low quality. Normally the responsible persons go for the supplier on the basis of the quality required and then treat the best price for it. There is always a trade-off between quality and price.3.4 The Purchasing ProcedureAccording to Dopsen, Hayes and Miller (2007) the mixed steps in the purchasing procedure areThe initiation of a request to acquire beverages by an appoint employee such as the head of department or restaurant managerThe selection of the source of cut from which the goods are to be corruptd, and the price to be paidEntering into a contract with the supplier by tele resound, electronically or in compositionObtaining a satisfactory delivery performance from the supplier with regard to time, understand and place of deliveryThe acceptance of goods ordered and the transfer to the ordering department or to the stores.Purchasing is not a separate activity. What, how and when you buy must always reflect the overall goals of your establishment. Trends change so must you, the leverager. (Brown, 2005396)Dopsen, Hayes and Miller (2007) reco mmend that the procedure should reflect the type of the establishment and the market where it operates. Those responsible should consider the location of the establishment in relation to its suppliers the size of the storage facilities of the hotel the shelf life of the beverage product and the companys purchasing power. whatever the establishment is, it is crucial to have a sound purchasing policy so that satisfactory standards will be achieved.3.5 Purchasing OrdersIn every hotel it is vital to have purchasing policies and procedures which are planned to allow line of work transactions to take place smoothly between supplier and receiver. docudrama evidence should confirm that the procedures are actually being followed.In Hotel-One purchase orders are authorised by the purchasing officer and the financial accountant while in Hotel-Two these are authorised by the group purchasing manager. In Hotel-Three the purchase orders are authorised by the cost controller or the general man ager while in Hotel-Four these are authorised by the head of department and the latter will also give notice (of) with the financial controller and the general manager, if deemed necessary. In all the hotels those authorising purchase orders are independent from those responsible for issuing requisitions. This prevents certain abuses that can be carried out when the homogeneous person will be responsible for both authorising purchase orders and for issuing requisitions.In Hotel-Two the persons issuing requisitions are the head of departments or the supervisors. Then the storekeeper will deliver the items that were previously ordered and the cost controller will verify that every order is in its perspective. In Hotel-Four the purchase orders are prepared by the head of departments while for the other terzetto hotels, the purchase orders are prepared by the purchasing manager.Every hotel has a system of par stock level. In Hotel-One the cost controller will work to create a par sto ck level which will depend on the period of the year, the type of functions that the hotel has, and the type of clients that the hotel has. The aim of these par stock levels is to have some items of every stock with a limited quantity since excessive stock means hard cash put down the drain. Additionally useless stock will lead to negative cash flows.In Hotel-Two it was remarked that the par stock level used is an informal one that will be adapted according to the company needs. A point to note is that in Malta, hoteliers work a lot on a last minute purchases. This can be used since distances are short and so if there is a stock item missing, you can phone the supplier and the latter will bring the item in a few hours. In Hotel-Three the cost controller is responsible to ensure that stocks in the stores are kept lowest as possible as these will represent idle money.The information contained in the purchase orders of each hotel is approximately identical to each other. Hotels One a nd Three does not have the terms of payments listed in the purchase orders. The purchase order of Hotel-Three contained a disclaimer that declares that if the supplier (who will receive the purchase order) will not agree with the purchase order in terms of quantity or price or he does not have the pre-agreed brand, the supplier shall inform the purchasing manager before the delivery. In Hotel-Four the type of brand is not listed in the purchase orders.All the hotels have sequentially pre-numbered purchase orders. Normally a assume of the purchase order is being received by the supplier. The goods received shop clerk/storekeeper will also receive the purchase order and the same copy will go to the cost controller who will add it with the invoice and passes it by dint of his system and then the cost controller will give the purchase order to the accounts clerk who will pass it through the accounting system.On receipt of an authorised requisition form, it is vital to go over the ec onomic quantity to be purchased by checking the existing stocks and the sales slew forecast. After establishing the purchase requirements, a formal written purchase order is prepared. This serves as the basis for ordering. Written records lessen misunderstandings so it is better to guard some written record of purchases, preferably on a purchase order, to verify the accuracy of deliveries received. (Dopsen, Hayes and Miller, 2007)3.6 Concluding RemarkThink of purchasing as a cycle, not a one-time activity. Purchasing is not good a matter of phoning or emailing another order. You dont want to run out, nor do you want to overstock. (Brown, 2005395)