Think about walking into the foodservice distributors warehouse and seeing thousands of aisles and racks with millions of products on them.  Now ask anyone has ever worked for a restaurant chain if this is their product selection experience. Can they choose the right products at the right price to improve costs and increase market share?   

Is your supplier selection process a competitive disadvantage?  You best purchasing tool is completing committed volume supply agreements. This is one secret that your broadline distributor doesn't want to talk about. 

When it comes to menu planning, cost reduction and strategic sourcing many restaurants and emerging chains are not capable of maneuvering past the maze of brokers, distribution representatives and manufacturer representatives to find fantasic products.

Take Carolyn’s American Café, a 17-unit regional chain in Brunswick, GA serving a menu of American and Mexican fare.  To compete with the national chains, they were encouraged to sign a one-stop,  master distribution agreement (MDA). They fell for the "spreadsheet" sale without seeking the resources required to issue  a professional RFP (request-for-proposal); analyize results, only to discover the dark world of off-brands and pricing misrepresentations. 

The purchasing supply chain contracting process is complex and the interdependencies between the distributor-broker-manufacturer may not always be obvious.  If you can not specify products and control the landed costs through distribution, your business is at a disadvantage.

Chart your path to lower costs and exciting new products by doing your own strategic sourcing and pre-qualification of suppliers.  Find suppliers that market to the end-user and that are not represented by distributor "in-house" brokers.  Keep the cost-factor in mind; broadline distributors must generate 17% gross profit (on average) on product sales and $175 profit dollars per delivery. 

It's difficult to explain how they can offer a 10 unit chains a blended 8.5% margin program. Suffice it to say, the "foodservice industrial complex" of distributor-broker-manufacturer,  expects you to buy a high percentage of their house labels and national brands that offer them back-side income.  

Don’t get caught up in thinking that your product selections are limited to the distributors inventory.  If your weekly consolidated purchases for a specific product is 10 cases, your primary distributor will slot the product for you. How many new products did you develop or bring into distribution this year?

Our firms’ success proves that the most satisfying and sound purchasing decisions come from a direct relationship with local, regional and national manufacturers, growers and packers that want to work directly with you, the end-user.

There is a growing trend to make product selections much more than just buying what they are selling.  

To Higher Profits!                                                                                                                                              Fred


Fred Favole is Founder & President of Strategic Purchasing Services, America’s most experienced purchasing firm specializing in purchasing outsourcing, commodity contracting and product development. Contact information, P: 912.634.0030 email:

Views: 18


You need to be a member of FohBoh to add comments!

Join FohBoh




Social Wine Club for Craft Wineries


PepsiCo exec Lisa Walsh shares path to leadership

Industry leader Lisa Walsh, vice president of PepsiCo Customer Management, has risen through the ranks at the company since j -More

Checkers, Philly Pretzel Factory seize opportunity at Wal-Mart

Checkers and Philly Pretzel Factory are hoping to benefit from Wal-Mart's popularity by embracing new franchise development o -More

Quickserve eateries entice customers with local and sustainable angle

Locally-sourced, conscientious ingredients are gracing menus and grabbing loyal consumers at an increasing number of restaura -More

Galbani® Mascarpone. Gold Standard True Italian Taste.
Italy has a flavor all its own. When it comes to cheese, chefs who know choose Galbani. For irresistibly savory risottos and pastas, try classic Galbani mascarpone. Its rich, creamy goodness makes it perfect for favorites like tiramisu and cannoli. Galbani mascarpone, one of the fine brands from Lactalis Culinary. For paring suggestions, click here.


Posting a job or finding a job starts here at FohBoh. Call us about special $50 posting packages to syndicate across all major jobs boards.

National News

Gen Z, the First True Digital Generation, Represents the Future Foodservice Consumer

Gen Z, the first true digital generation, represents the future foodservice consumer. They're a generation on the move that strongly prioritizes speed of service, technology, and having what they want, when they want it. Millennials, more so than older generations, prefer to visit restaurants that offer new and unique foods and flavors. Gen X and Boomers converge on several preferences—such as the importance of a convenient location.

Red Robin Gourmet Burgers Celebrates Its 500th New Restaurant Opening

Red Robin's 500th new restaurant opening will open on Aug. 4 at 11 a.m., in Milpitas, Calif. at the Great Mall of the Bay Area.

Darden Completes Sale Of Red Lobster To Golden Gate Capital

Darden Restaurants, Inc. (NYSE: DRI) and Golden Gate Capital today announced that Golden Gate has completed the acquisition of the Red Lobster business and certain other related assets and assumed liabilities for approximately $2.1 billion in cash.

Dunkin' Donuts Announces Plans For Seven New Restaurants In Duluth, Minnesota With New Franchisees Brian And Sharon Weidendorf

Dunkin' Donuts announced today the signing of a multi-unit store development agreement with new franchisees, Brian and Sharon Weidendorf, to develop seven restaurants in Duluth, Minnesota and the surrounding areas. The first restaurant is planned to open in spring 2015.

Wendy's Names Brandon Solano Senior Vice President of Marketing

The Wendy's Company (NASDAQ: WEN) announced today that Brandon Solano, 43, a veteran brand builder and product innovator, has been named Senior Vice President of Marketing.


If you are looking for capital to start or grow your restaurant, create the next 501c3, develop and launch the next app for the restaurant industry,or want to help your peers in some meaningful way, we want to know about it.


TED: Ze Frank: Are you human? - Ze Frank (2014)

Have you ever wondered: Am I a human being? Ze Frank suggests a series of simple questions that will determine this. Please relax and follow the prompts. Let's begin …

TED: Heather Barnett: What humans can learn from semi-intelligent slime - Heather Barnett (2014)

Inspired by biological design and self-organizing systems, artist Heather Barnett co-creates with physarum polycephalum, a eukaryotic microorganism that lives in cool, moist areas. What can people learn from the semi-intelligent slime mold? Watch this talk to find out.

TED: Shih Chieh Huang: Sculptures that’d be at home in the deep sea - Shih Chieh Huang (2014)

When he was young, artist Shih Chieh Huang loved taking toys apart and perusing the aisles of night markets in Taiwan for unexpected objects. Today, this TED Fellow creates madcap sculptures that seem to have a life of their own—with eyes that blink, tentacles that unfurl and parts that light up like bioluminescent sea creatures.

TED: Nikolai Begg: A tool to fix one of the most dangerous moments in surgery - Nikolai Begg (2013)

Surgeons are required every day to puncture human skin before procedures — with the risk of damaging what's on the other side. In a fascinating talk, find out how mechanical engineer Nikolai Begg is using physics to update an important medical device, called the trocar, and improve one of the most dangerous moments in many common surgeries.

© 2014   Created by FohBoh.

Badges  |  Report an Issue  |  Terms of Service