Procurement in the food and beverage industry tends to involve a large number of suppliers, even for smaller businesses. Whether you’re a food manufacturer, restaurant, or other organization, chances are you need a variety of ingredients and food products, and one or two sources will not be enough to fill your requirements. This makes proper procurement practices essential. With items in the food and beverage industry making up a significant percentage of expenses, managing them properly can make a significant difference to your bottom line. So, in this article, we have talked about a few important tips to manage procurement in the food and beverage industry.
How to manage procurement in the food and beverage industry?
#1. The system to manage supply orders
One thing to consider when examining procurement practices is what system you use to manage supply orders and interactions. Some business uses generic procurement software, or do not use a program at all. The food and beverage industry has some unique and complex qualities, and using a system made specifically for that industry can be much more efficient.
#2. A strong spend analysis program
A spend analysis program valuable when dealing with a large number of suppliers. With so many purchases from multiple sources, it can become overwhelming to try and find the best price for every single item. A spend analysis program can provide in-depth insights into where your money is going and identify areas where it is possible to order more efficiently making procurement in the food and beverage industry more efficient.
#3. Regional regulations
Regional regulations also have an impact on procurement as changes in laws can impact what you need from suppliers and how you source your food items. Even if you are not operating in multiple countries, regulations can vary from place to place within a country, such as the United States, where each state regulates the industry separately. It is important to keep on top of these rules, know what is required in that area and being aware of changes that can impact your business operations. This is another area where a strong procurement system in the food and beverage industry can be invaluable, as it can streamline communication with multiple suppliers when something needs to change.
#4. Group purchasing
If you are a smaller company or need a relatively small quantity of a particular item, group purchasing can bring savings that would otherwise be inaccessible to you. Group purchasing organizations allow multiple companies to combine their orders in order to take advantage of bulk discounts and other incentives. They also allow businesses to share information and insights into suppliers and tactics that help in streamlining the procurement in the food and beverage industry.
#5. Meetings with salespeople
One other way to streamline procurement in the food and beverage industry is to make the most of your meetings with salespeople. Much of the time in these meetings is often taken up by administrative tasks that do not need to be taken care of in person. Taking care of those tasks through other channels will free up the time to discuss other matters that can result in better deals, a stronger understanding of each other’s strategies and processes, and a closer relationship.