Increasing restaurant profits through optimised purchasing
As a restaurant, the goods that you purchase are a direct reflection of your business – so you want your purchases to be high quality items with timely delivery – and you also need them to be ordered according to need and within pricing agreements.
In our guide to increasing restaurant profitability, Angela Hart and Billy Waters looked at 12 different opportunities to improve the bottom line, including optimising purchasing in the following ways:
Do away with rogue purchasing
It’s not uncommon for restaurants to make ad-hoc purchases from multiple local suppliers rather than weekly orders from a smaller number of key, approved companies. Ad-hoc purchasing is more expensive and it means that you are missing out on potential rebates when spending thresholds are met.
You therefore need to enact a process that ensures purchases are made from approved suppliers. The good news is that you can use technology to enforce and lock down supplier lists, ensuring that all sites can only purchase from specified businesses.
You can even go so far as to set delivery schedules in the ordering system, so that any order placed outside the schedule is rejected.
You’ll obviously need to allow some flexibility in case of emergencies, but formalising the process will ensure ad-hoc purchases are kept to an absolute minimum.
Eliminate paper from the entire purchase-to-pay process
Any paper-heavy process is going to have room for improvement and usually, the more paper you can remove the more savings that can be made.
With the purchase-to-pay process we’re talking about purchase orders, goods received notes, invoices, credit notes and the like. And with lots of paper moving around the business and between you and your suppliers it’s not just the effort involved with moving and processing this information to think about, but also the risk of errors due to re-keying information into the relevant systems which then take additional administration resource to resolve.
By trading electronically you can remove paper from the equation. Information can be automatically extracted from received documents to populate the system, and everything is stored in the right place so you don’t run the risk of losing documents or having to spend hours searching for them.
Checking that the details on the invoice match the original order and the goods received note is essential to make sure you’re not paying too much due to any mistakes (which happens a lot more than you might think in our experience). With technology, this process can be automated to eliminate paper-based manual processes and make sure you’re only paying for what you’ve ordered and had delivered. 3-way invoice matching highlights any differences between the three sources of information, meaning you only need to manage invoices by exception, rather than having to go through each individual one.