Next to inventory management errors, F&B purchasing mistakes are the number #1 reason operators struggle to get their food costs under control. That’s because many operators haven’t optimised or standardised their restaurant procurement process.
You might be a natural at finding reliable suppliers and negotiating contracts, but that’s just one piece of the procurement process. To prevent costly errors, you need to create policies for every step in the restaurant purchasing process and ensure all your locations follow those guidelines.
In this F&B purchasing guide, we’ll cover how to develop and strengthen your procurement process, and what to consider when evaluating potential suppliers. We’ll also explain how inventory management software can automate procurement practices and prevent common errors.
Restaurant procurement is not simply “buying stuff.”
is an intentional, goal-oriented, and meticulously planned function concerned with search, selection, purchase, receipt, storage, use, and control of a business-vital commodity. The goal is maintaining optimal inventory levels without overspending or wasting.
The three guiding principles in the restaurant purchasing process are:
If you want to stay on top of your restaurant’s F&B procurement activities, you need to start thinking about the whole process as a cycle, and not a one-off.
While this means that your job is never done (restaurant purchasing is not a ‘set it & forget it’ type of activity), there are still ways to optimise the whole thing so it runs like a well-oiled machine.
When you’re purchasing for a large, multi-outlet or enterprise operation, following these steps will help you do a better job. Select better vendors, serve better food, and keep your food cost down. And you’ll do it all without fumbling and making costly mistakes.
Small to medium foodservice operations generally don’t have robust purchasing standard operating procedures (SOPs) and policies. But SOPs (Standard Operating Practices) are essential for making good procurement decisions.
If you don’t have any policies for procurement practices, take a look at the following examples:
Example: Ordering policy
“Every Friday and Tuesday afternoon, the group procurement manager reviews F&B orders for all XYZ outlets and sends orders to individual suppliers. Vendors deliver the items to locations every Monday morning (for Friday orders) and Thursday morning (for Tuesday orders).”
This policy centralises the procurement process, defines supplier obligations, and ensures delivery schedules don’t disrupt production.
Example: Food specs policy
“Outlets in the ABC group have menu items that require the use of Grade: Prime cuts. Outlets in the XYZ group do not serve expensive meat cuts, and should only request (and use) Grade: Good cuts.”
This policy illustrates how procurement managers can control food costs across multiple concepts.
You should always purchase to PAR levels because they’re calculated based on historical sales data. They’ll help you get as close as possible to the right amounts (without overstocking or understocking).
Barring daily counts, there are two ways to get to these numbers:
[Free PDF] F&B Purchasing Guide For Multi-Unit Restaurants
In this e-book for the foodservice industry, you’ll find proven tactics and guidelines to help restaurant managers make better purchasing decisions when ordering food and beverages.
How many suppliers do you need to ensure product availability? It depends. If your locations are hundreds of kilometres apart, you may need multiple vendors. But if you have just a few units in the same city, you might not need multiple suppliers.
You might miss out on bulk discounts if you have too many suppliers. With fewer suppliers, you might be more susceptible to supply chain disruptions.
What is the optimal number of vendors?
Restaurant procurement best practices dictate having two or three vendors for your main categories (meat, dairy, and produce), and a handful of vendors for specialty items (cured meats, mushrooms, wines). This approach gives you alternatives for your essentials, and you can accept occasional bids to keep your vendors on the straight and narrow.
5 approaches to food and beverage purchasing:
Most foodservice operations evaluate potential suppliers based on three factors:
After you’ve had a few runs with the vendor, you can score them on all three metrics. For example, if you use a 10-point numerical grading system, your highest supplier performance score rating would be 10/10/10 (best price, best quality, best delivery). Include as many categories as you like. If fair trade practices and ethical sourcing are important to you, you can score vendors on those metrics.
About beverages
Most operators source beverages from wholesalers since shippers are not inclined to work in small batches (other than wine shippers working with select Michelin Star restaurants).
Quality is standardised, and the prices don’t vary much throughout the year, which makes inventory control and pricing more straightforward.
Compare prices to find the best possible deal from reliable suppliers and keep an eye on timely delivery & payment terms.
Most restaurant operations place weekly or bi-weekly orders, with some placing monthly orders.
Place orders as frequently as you have to if that will help you control your food cost. Your goal is to be production-ready at all times without tying up money in inventory you don’t need.
Typically, ordering is a three-step process:
Now review product specifications and quality standards, as shown below:
(If your specifications are not as detailed, that’s OK. Most items are standardised — for example, when you say “prime cut contre-filet,” most vendors know that means the best cut of meat, deboned, with suet deposits and gristle removed).
When you have your quantities and qualities, you can fill out your purchase order form.
Note: You’ll need several copies of this document, and your receiving clerk (at each location if you’re operating a multi-outlet) needs to have one so they can control the deliveries.
The most important points to include in a purchase order are:
Note: If you use Apicbase to manage food procurement, it automatically suggests purchases based on your POS data, inventory levels, and bills of materials. All you have to do is review and send the order.
Curb High Food Costs With Data-Driven Purchase Orders
When your kitchen teams use procurement software for restaurants, every order they send to an F&B supplier is created using real-time data on stock levels, sales and production needs.
This way, you avoid the overstocks and shortages that increase your cost of sales and erode your margins.
You can have the best procurement practices and maintain optimal stock levels. But if you don’t carefully inspect everything that’s delivered, none of that matters. That’s because you have no control over what’s coming in (in terms of quantity and quality) and whether or not it’s usable, but you’re still paying for it.
Make sure your receiving team (a receiving clerk, chefs, or managers, depending on your set-up) has the info they need to accurately process deliveries and ensure all orders are complete.
The receiving clerk (manager or head chef in smaller operations) is responsible for:
In operations that have central vendor delivery (goods delivered to one location and then distributed to the outlets by the operator) some of these steps can be skipped.
However, if you have the bandwidth, review the receiving process at every location. This acts as a safeguard in case something was missed during the first inspection or if there’s pilferage happening on the way from point A to point B.
Apicbase users use the central kitchen management software to keep tabs on orders and deliveries from one unit or outlet to the other.
The last step in the F&B restaurant purchasing cycle is also the one that operators often skip.
Your procurement and accounting teams need to work together every month to verify invoices before paying them. This means double-checking the quantity and the quality of delivered goods, and matching them with order forms and daily lists of received goods.
If there are any changes in payment terms — like discounts, rebates, or corrections — they need to be reflected on the invoice.
Twice a year, review payments to verify that you’ve deposited the right amounts to vendor accounts. If you’re automating your payments, an error can slip in here occasionally — if you’ve paid less, you hear about it from the vendor. But if you’ve paid more … well, you probably aren’t getting a refund unless you ask for it.
Ideally, your back-of-house software should integrate with your accounting software to ensure purchase orders and invoices match.
Apicbase is an all-in-one solution for managing multi-site operations. Whether you’re looking for restaurant inventory management software, a way to automate your procurement process, or identify reasons for food waste, Apicbase can help.
With Apicbase, you get complete visibility into the performance of all units. You can effortlessly calculate PAR levels to minimise waste, forecast demand, and avoid the costly errors that are all too common in restaurant procurement.
Connect your restaurant procurement, inventory management, and food costing in a single platform.
Find out how Apicbase drives efficiency and profit margins for foodservice operators.
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