Media Kit

Fb Share

Did you hear the one about the restaurant company that had 14 different cheese suppliers for 14 different styles of cheese?

While that joke may be a bit exaggerated, it is true, too often we forget about the costs associated with delivery. Like the forest for the trees, we see ourselves saving a nickel on a deal only to lose much more than that as an end result.

Consolidation, by its definition, is more efficient, less time-consuming and more economical. Instead of having multiple deliveries from a variety of sources — a broadline distributor, a paper company and a meat company, for instance — we end up wasting valuable dollars and hours that affect the bottom line.

Throughout my many years in the business, I have applied different measuring tools to ascertain the total cost of receiving a delivery. The average number I use for the cost of a delivery is $75. In addition to receiving dock labor, other costs include the management and administrative costs associated with issuing a separate P.O. and the various steps leading to statement reconciliation.

Additional costs, both tangible and intangible, add up: The labor needed to administrate the delivery; issuing another invoice, statement and check; following up receivables; and the chance for a mis-pick, a late truck or some other mishap associated with delivery. Finally, the more often your dock door is open, the more likely pests get in and product finds its way out in a trash bag or other method.

We always want to get the best deal, so we search and negotiate to the nth degree until we find it. While we may get the best individual deal for a specific product, we end up forgetting the cost of that separate delivery.

There are buyers who speak with pride at their largesse and the "need" to use three separate broadline distributors. It is one thing to have a back-up distributor and quite another to have them crossing over each other. Where is the benefit? Most likely, they carry many of the same products so you have an opportunity to negotiate a great distributor deal rather than having a bevy of trucks at your dock when one will do.

Of course, you may have to have multiple sources based on need — a specialty cheese that is not supplied by your broadline distributor can only be delivered by your gourmet cheese house, for instance.

Ultimately, it is important to recognize that supplier consolidation is not a four-letter word, and that the fewer suppliers you use the more economical and beneficial it is to your overall business. Lowest invoice price is not always the lowest cost.

Related Content

User Comments – Give us your opinion!
  • Edward Zimmerman
    13714554
    Great points on hidden costs
Products & Services

Get more from your restaurant POS with online videos and tutorials

http://global.networldalliance.com/new/images/products/1294.png

1294/Get-more-from-your-restaurant-POS-with-online-videos-and-tutorials

Custom Digital Signage Templates

http://global.networldalliance.com/new/images/products/6683.png

6683/Custom-Digital-Signage-Templates

POS health test: do a quick check

http://global.networldalliance.com/new/images/products/1288.png

1288/POS-health-test-do-a-quick-check

Food Cost Management

http://global.networldalliance.com/new/images/products/6401.png

6401/Food-Cost-Management

Enterprise Solutions

http://global.networldalliance.com/new/images/products/4124.png

4124/Enterprise-Solutions

Customized Menu Board Content

http://global.networldalliance.com/new/images/products/6689.png

6689/Customized-Menu-Board-Content

Thr!ve Point-of-Sale

http://global.networldalliance.com/new/images/products/6811.png

6811/Thr-ve-Point-of-Sale

FireFly Point-of-Sale

http://global.networldalliance.com/new/images/products/4282.png

4282/FireFly-Point-of-Sale

Remote Service | Content Management Service

http://global.networldalliance.com/new/images/products/6685.png

6685/Remote-Service-Content-Management-Service

Enterprise Reporting & Management

http://global.networldalliance.com/new/images/products/6813.png

6813/Enterprise-Reporting-Management

Food Cost Management

Latest posts by John Krebs
John Krebs
John Krebs is a dynamic, seasoned executive with experience in building and growing multi-million-dollar organizations through strategic visioning, expert leadership, and strong operational expertise. Krebs has helped hundreds of foodservice organizations achieve a focus on exceptional results by using his operational and supply expertise in distribution, purchasing and operational management.
Digital Menu Boards and ROI
Request Information From Suppliers
Save time looking for suppliers. Complete this form to submit a Request for Information to our entire network of partners.