Article

5 ways to get the most out of your supply chain

Having the time and infrastructure to focus on 100 percent of what you purchase could be the difference between a good food product and small savings to a great food product with significant savings.

February 24, 2016

By Bruce Reinstein, president, Consolidated Concepts

The typical multi-unit restaurant brand has a team of experienced and smart leaders who take a great deal of pride in what they serve to their guests. They truly believe that what they do is better than anyone else and that their standards, specifications and the prices they pay are beyond approach.

However, while they have great buying power, they may not always get big savings. Yet, having the time and infrastructure to focus on 100 percent of what you purchase could be the difference between a good food product and small savings to a great food product with significant savings. What this requires is a completely different view of the supply chain infrastructure as seen through the lens of the restaurant value chain.

1. Create the time and infrastructure to focus on 100 percent of what you purchase. While having a great price on your top 20 items is a good start, many teams lose focus on other areas such as disposables, produce and low-volume items. It may not seem as important to negotiate great deals on these items; however, with the backdrop of the restaurant value chain as an operating mantra, brands can assemble a plan for these other areas that put low-volume items back into focus. It's not about concentrating only on what sells the most, rather what you use 100 percent of the time across your entire brand. This is true if we're talking about anything from toilet paper and napkins to any ingredient from farm to fork.
2. Compare protein products for maximum yield. For many restaurants brands, the protein products being purchased for certain menu items lose their yield due to inconsistent manufacturing specifications and sporadic employee trimming processes. From your office, it is really hard to know how much the kitchen staff is trimming, or how they are dealing with the unpredictable sizing. Therefore, it might be time to review your product and compare it to what you're actually paying for. There are many alternate cuts of proteins that would work well in your application. These alternate cuts could provide labor savings or general cost reductions. Some of these alternate cuts also could be used for limited-time offerings.
3. Understand the team's area of expertise. Within almost every organization there is someone leading the supply chain effort. This person could be handling the role full time or it has become part of the many other roles and responsibilities they have to manage. While this person may be a strong negotiator, they now have the responsibility of updating Broadline distribution agreements, and are dealing with a lack of buying power in new markets. This is on top of working on food safety and traceability programs to protect the brand. While they may excel in certain areas, do they know and understand whether a product being used in one market now is the right product for growth. This situation likely requires a supply chain review based on a team's ability to observe the right product for scalability, to define opportunities for new products if needed, while also solving for current and future challenges.
4.  Make sure your product specifications are the best for your brand. If your brand makes anything fresh it's easy to have two or more ingredients account for more than 50 percent of product spend. For example, your brand makes fresh guacamole and the specification is a 48-count, No. 1 avocado. While a 48-count, No. 1 avocado may look better and be perceived to yield better, it is the wrong product to use for this purpose. A 60-count, No. 2 avocado provides the appropriate quality that is needed and at a great savings. Therefore, one slight change of an ingredient can have the same quality as what guests are used to, but yield greater savings for the restaurant.
5. Give your guests consistent products. Many brands today are making menu items from scratch and even though these items have great flavor profiles, there are mixed product reviews from guests. Additionally, so much is being done from scratch that there is a labor issue at each location. If this sounds familiar, it might be a good time to review which products should remain from scratch and which items could be partially made ahead of time. For example, specialty baked breads are key items to many concepts. If made on premises, these breads are proofed, baked and then served warm. The basic quality of the dough is moderate, and when prepared is a real winner for guests. Unfortunately, the product is not proofed properly much of time, which creates product inconsistency. A par baked product might be something that will provide better consistency, less waste and better comments from guests, and it will solve for some labor issues. And while the product may cost more, the result will pay off in the long run.

I know how difficult it can be to review and re-evaluate supply chain processes and products; however, better tasting food, the right mix of products and a consistent guest experience should be the end goal. By looking at your supply chain through a series of observations, opportunities and solutions, your brand and your customers will come out on top.