In this example, the total food purchases for this report were $64,146.43 for ALL vendors/stores (which is the total of all the rows you don’t see). You will notice that I highlighted the first 12 items in yellow. When you add these highlighted items together, it comes out to be $32,786.78 or 52 percent of the total $64,146.43 in purchasing. What this demonstrates is one simple overlooked fact in the restaurant business: your top 10–12 purchases represent 50 percent of ALL your purchasing!
STEP 3
Now that you know there could be products that are available to you at a lower cost, here’s what you do. You take your top 10–12 products that you purchase as listed in our compiled descending dollar report and ask your food sales people from whom you purchase these products the following question, “If I promise to buy all of this product from you over the next year, can I get a better price?” If you’ve ever been to a food show, you understand that at the show, if you promised to purchase a certain number of cases of a specific product they would lock you into a better price for that product. Well, distributors are able to do that anytime.
If you’re lucky, your sales person will be able to simply give you a better price. If you’ve been luckier, your sales person has already been giving you his or her best price. In this instance, your sales person will reply with, “No. I have already been taking care of you.” Don’t just accept this answer and move on. Next you will ask this new question, “Do you have a like-quality or better-quality product at a cheaper price?”
Notice, I didn’t have you ask if they had a cheaper product. You NEVER want to go with a lower quality product, that would go against your core values and kill your dish. But you should be willing to switch to an equal quality product or better-quality product if you can get it for a better price than you are paying now.
Using an appetizer example, by asking this question, your sales person would open their laptop, do a search and find a company you weren’t purchasing, Great American Appetizer products, and gives you the opportunity to purchase it. The results will be amazing. If you could purchase the same groceries out of your top 10–12 items on your descending dollar report for less, you may see as much as a 2–3 percent savings.
By simply gathering the right data, doing some manual data entry, combining all of your reports and sorting that data, you’ll be able to attack your top 10–12 items you purchase and reduce your food cost by 2–3 percent. My question to you is, not will you do it, but rather what the heck are you waiting for? Take action.
