Foodservice purchasers who are not aware of corn and other commodity price changes run the risk of not being able to properly plan their purchasing and cost analysis for the coming year. Corn prices are caught up in a maze of factors that range from weather to how large users leverage their purchases.
Understanding the science and methodology of menu engineering goes beyond where to place profitable items on the menu. You now know (see Part 1 - previous blog), that you can benefit greatly by placing your highest profit items in the right places on the menu to encourage their sales and thus, increase your bottom line.
Have you ever walked into a department store and wondered why the jewelry counter is located in the front? Notice also that the women’s clothes and shoes are way in the back of the store. In a grocery store, have you noticed the sales items are at the end of the aisles? Also, certain goods are at eye level and others on bottom shelves.
It’s a simple fact of human behavior: People don’t want you to see their mistakes. This is especially true in the food service business where mistakes become waste and lost profits. In our business, every morsel has been bought and paid for and its value lies in its resale not its position at the bottom of a trash can.
As 2013 enters the proverbial scrap heap of life, we turn our eyes to a new and tantalizing year. I say tantalizing because every New Year should seem that way. Instead of just hoping that 2014 will be better than last year, take a few steps to make sure it’s a great year. We suggest you look at the “pain” in your business life; i.e. what’s causing you to regularly stress out? Our guess is that you are one of many in corporate America trying to do more with less.
Do you think Charles Dickens had a foodservice buyer in mind when he created the despicable Christmas-hating Ebenezer Scrooge? Think about it, as the Holiday season surrounds us, are you more prone to blurting out a “Ho, Ho, Ho!” or a “Bah, Humbug!”?
In their continual search for ways to cut food costs, buyers often become the worst type of shopper: They shop by total case cost rather than by yield. How often have you been sucked into buying a product simply by comparing case costs?
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.
In my travels around the foodservice world, I have found that many buyers believe collective buying leads to the loss of one of their most prized possessions: price confidentiality.
That’s a number we so often neglect in the purchasing process. We are consumed by gaining a profit and thus seek the best price for the products we buy for our operation.