Critically evaluate the role of purchasing and supply chain management in restaurant and bar operations while considering how this, and a proactive approach to cost control, can provide these businesses with competitive advantage in a crowded marketplace.
As per the view of Evranuz (2012), role of purchasing and supply chain management (SCM) assists in becoming potential and valuable way of securing competitive advantage in order to enhance the business performance (Evranuz, 2012). It is essential for food and beverage business to maintain good relationship with suppliers by providing them timely payment so that they deliver best services to businesses. However, Lui and Lai (2010), argued that purchasing department within the food and beverage business began to realize that it is not enough to enhance the supply chain of business and attain competitive advantage. It can be evaluate that supply chain and transportation network design technology assists in enabling food and beverage companies to stimulate SCM and reduce the cost and attain competitive edge over rivals (Lui and Lai, 2010).
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According to Rutherford (2010), within food and beverage (F&B) industry, manufacturing strategy is one of the crucial decision that firms face and thus it helps in making and distributing their products so that best decisions can be taken. Another crucial decision within such stage is that different challenges faced by F&B operations in relation to lower down the cost operations so that competitive edge can be attained in marketplace (Rutherford, 2010). Companies focuses upon tapping target market and providing them low price food and beverage options so that it gains high profits and success. There are different factors that helps in reducing the cost factors such as transportation, inventory, raw material costs and tax etc. Tsai (2012), stated that it is also essential for firm to implement innovative technology so that they can serve the customers effectively and attain satisfaction. Further, through adopting merger and acquisition strategy it assists in integrating new supply chains into an existing network so that such initiatives fails to meet the expectations of shareholders (Tsai, 2012).
As per the Bottani and Galati (2010), F&B companies also focuses upon undertaking merger and acquisition strategy so that they can develop a new business supply chain initiatives which fail to meet the needs of shareholders. It can be assessed that food and beverage companies mainly try to minimize their cost so that competitive advantage can be attained. Furthermore, using cost to serve analysis is the best method through which food and beverage businesses identifies the value of the product and thus decide the price so that profits can be attained. Here, purchasing and supply chain department plays a crucial role in identifying the cost of the products which needs to be lower down so that competitive edge can be attained over rivals (Bottani and Galati, 2010). In the current era of globalisation, there are various competitors available within food industry which give tough competition to each other. Therefore, it is essential for businesses to introduce innovative products or control its cost so that target market can be attracted towards firm in order to enhance the market share (Díez-Leturia and García-Jalón, 2011).
McGinnis and Kraak (2006), stated that F&B businesses plans to improve its production capacity planning by utilizing existing capacity for lowest total cost so that firm can perform more effectively in order to produce quality good and bar products in order to enhance customer base. Firm also aims to lower down its cost and ensure producing fresh products so that quality of firm can be enhanced among rivals and attain competitive edge (McGinnis and Kraak, 2006). Food and beverage industry identifies the significance of fostering an environment that stresses the best communication and teamwork among all the departments within the firm. Hotel business involves purchasing and supply chain management as an crucial department that helps in controlling the cost so that supportive and collaborative environment allows business to support each other while working towards department and company goals. However, Suh and Eves (2010), argued that supply chain is used in order to describe the collaboration of different businesses in regard to assist firms and move products or services from suppliers to customers. Food and bar options involves different suppliers of raw materials, producers of final products and the end users in regard to develop relationship with suppliers and purchasers so that it does not impact upon the overall success of firm. Adopting cost control measures and advantages obtained from building best relationship and partnership in the industry helps in attaining desired success (Suh and Eves, 2010).
Further, F&B business aims to develop purchasing functions by adopting effective raw materials and develop relationship so that best responsibilities can be attained. Here, in order to reduce cost, company identified different supplier opportunities and paying attention to industry trends and develops new products so that competitive edge can be attained over rivals (Julien, 2011). Hence, it is crucial option that helps firm to focus upon through purchasing and attaining supply options so that cost can be minimized in relation to obtain success. Hotel businesses focuses upon their purchasing and supply chain management in restaurant and bar operations so that it assists them to control the cost within firm and thus provides chance to firm to obtain competitive edge in terms of high market share as stated (Davis and et.al., 2012). Food and bar operations within hospitality firm aims upon managing its purchasing and supply chain management functions so that they can carry out the best responsibility towards firm and satisfy individual needs. For instance, purchasing raw material assists in identifying the development of new raw materials in order to develop product development professionals so that best relationship can be developed (Dimitriadis and Stevens, 2008).
As per the opinion of Drake and et.al., (2013), internal relations assists in identifying the different business functions which must work together in order to achieve maximum efficiency and thus attain optimal profits. Hence, the purchasing department should work with the accounting and finance department in order to secure the funds and track payments for material purchases and try to minize3 cost so that competitive edge over rivals can be attained (Drake and et.al., 2013). However, Ferreira and et. al. (2012), argued that purchasing department must also work with production and forecasting teams in order to make sure that they timely delivery of materials and thus involve marketing and sales department so that hotel can enhance its market image and thus improve the efficiency so that desired goals can be attained (Ferreira and et. al. 2012).
Moreover, in order to maintain customer satisfaction helps in attaining ultimate goal so that change can be implemented within marketplace and attain customer service. French, Story and Fulkerson (2002), stated by firm possess the ability to adopt essential information and desired products in order to give tough competition to rivals in the market. Also, businesses are able to obtain effective food and service department helps in improving the business success. Attaining competitive advantage helps business to enhance the market share and attain satisfaction (French, Story and Fulkerson, 2002). Purchasing department is responsible for procuring supplies and thus it largely involves order placing and influences the people to improve the market share. However, Gomes and Lobstein (2011), argued that purchasing and supply chain within restaurant and bar operations assists in improving the competitive advantage so that success can be attained in an effective way. Business uses effective purchasing and supply chain so that cost control needs to be practised in relation to attain satisfaction. Another crucial role of the purchasing department is the source supplies and parts and then purchase them so that business decides to purchase the raw material in such way that helps in lowering down the cost in order to improve the efficiency of firm in market (Gomes and Lobstein, 2011).
As per Gootman, McGinnis and Kraak (2006), food and bar operations are required to manager supplier relationship and negotiate contracts for the supplies so that they are responsible for monitoring the supplier's performance. Purchasing department needs to assess the suppliers' performance and quality control in order to monitor deliver times, quality, cost and performance so that best results can be attained. Here, suppliers helps in maintaining effective relationship with the environment so that working conditions can be improved in relation to enhance the performance targets and thus improve the training and development program in order to attain desired results (Gootman, McGinnis and Kraak, 2006). Moreover, purchasing department undertakes cost control measures in order to enhance the performance and thus responsible for maintaining strict cost control measures so that purchasing raw material for hotel assists in enhancing the sales and profitable of firm. However, Man, Lui and Lai (2010), argued that firm aims to buy the products at best price therefore purchasing department requires ensuring suppliers themselves to get the lower cost and thus enhance the sales and profitability of firm. Further, it assesses that purchasing department needs to be aware regarding applying the purchasing and supply chain management so that effective regulation can be developed in order to attain desired results. It is also essential for the purchasing department to be aware of all the different laws that could be applied to the purchasing of raw material within firm. For private firms, it is the primarily contract law that helps in benefiting the government bodies in order to regulate the purchase so that competitive advantage can be attained (Man, Lui and Lai, 2010).
Meler and Cerovic (2003), stated that supply chain management practices identifies a set of activities undertaken within firm in order to promote effective management of its supply chain. It also describes the latest evolution of SCM that involves supplier partnership, outsourcing, regular flow of material etc. in order to undertake effective purchasing quality and customer relations so that success can be attained. Adopting strategic supplier partnership assists in developing long term relationship in order to develop strategic and operational capabilities of individual participating business to attain significant benefits (Meler and Cerovic, 2003). Develop strategic partnership assists in building long term relationship within business and suppliers. Thus, it assists in improving individual capabilities so that desired success can be attained. Food and bar operations helps in entering into purchasing and supply chain management relationship so that cost control can be attained in order to measure effectiveness and attain competitive edge over rivals.
Role of purchasing and supply chain management within restaurant and bar operations plays a crucial role because it helps them to identify their strengths and attract customers from market. It is a proactive approach because it assists in controlling cost in order to provide businesses with competitive edge in the crowded marketplace so that success can be attained. Company also aims to develop effective customer relationship so that best results can be attained in order to improve the market share and thus enhance the sales and profitability of firm in market. Motherway and Vargo (2013), stated that purchasing and supply chain management within restaurant and bar operations helps in considering the cost control measures so that delivering the products or services at low cost helps in attaining competitive edge over competitors. Improving restaurant and bar operations assists in improving competitive advantage so that cost can be controlled and thus it leads to attain firm towards a competitive marketplace. Further, it also helps in improving the business performance and thus attain organizational objectives (Motherway and Vargo, 2013).
Implementing benchmarking method helps in practising hundreds of companies that have learned actually to attain competitive edge and thus apply best results so that success can be attained. Using purchasing and supply chain within the restaurant and bar operations that helps in attaining core competencies so that success can be attained. Restaurant and bar operations' department within hotel requires developing better communication by using innovative technology so that they are able to share crucial information with each other and thus enhance customer demand (Nestle, 2013). Suppliers and purchasers at this point of time identifies the requirement of resources and thus enhance the sales and profitability of firm in market. Additionally, firm also access to business point of sales data that helps them to anticipate at the time when it will take place in order to improve the performance and obtain desired goals.
Management of firm aims to identify the different cost control measures that assists in providing opportunities to firm in order to improve the purchasing and supply chain management system in order to enhance the sales and profitability of firm. Restaurant and bar operations requires maintaining cost leadership so that competitive advantage can be attained (Food and Beverage Industry Outlook Survey. 2013). Main reason behind this is that business aims to adopt cost leadership so that it assists them to eliminate waste and thus decide firm to build effective relationship in order to improve competitive advantage and attain success. Evranuz (2012), argued that adopting cost control measures assists in identifying the role of purchasing and supply chain management systems so that best results can be attained in an effective way. Firm also emphasizes upon delivering the best product quality so that managers helps in improving the business performance (Evranuz, 2012).
Furthermore, improving reliability assists in producing or providing consistent quality of products or services over a period of time and thus enhance the reputation of firm in market. Business also undertakes reliability measures so that they can produce or provide consistent quality of products in order to enhance the sales and profitability of firm in marketplace. In addition to this, quality is one of the significant part within firm in order to forecast the business opportunities so that actual requirement can be attained (Food and Beverage Operations Manager. 2013). The team of hotel helps in providing daily, weekly, monthly and annual estimation so that best results can be attained. Further, business also focuses upon identifying the flexibility so that they can deliver best services to customers and thus attain competitive advantage in crowded marketplace.
It is essential for firm to adopt effective supply chain trends so that it can be used in order to improve the modern business environment and attain competitive edge within firm. Restaurant and bar operations helps in specifying the use of purchasing and supply chain in order to improve their competitive advantage. It is also essential for firm to improve its operational performance and efficiency can be improved so that it impacts upon the changing operational environment and thus success can be attained in an effective way (Rutherford, 2010). Business also aims in delivering standardised services so that target customers can be attracted. A supply chain system is based upon improving the performance of firm and delivering the products or services on time so that set targets can be attained effectively and efficiently. Operational performance and efficiency is the crucial part as it assists in improving the business performance so that it can assist in changing operational environment so that success can be attained effectively (Díez-Leturia and García-Jalón, 2011).
As per the opinion Suh and Eves (2010), of business aims to provide quality products or services in relation to render best quality services to customers and enhance sales performance of firm. Purchasing and supply chain management helps in enhancing the restaurant and bar operations so that best results can be attained. Using purchasing and supply chain within restaurant and bar operations using cost effective methods in order to improve the cost and quality of firm in marketplace. Business also focuses upon improving the business performance so that set targets can be attained in an effective way. However, Davis and et.al., (2012), argued that firm also aims to enhance its restaurant and bar operations so that more number of customers are attracted towards firm an thus enhance the sales and profitability of firm in market. In order to enhance the firms' performance and thus attain desired results so that success can be attained in an effective manner.
Business also faces challenges in order to manage cost and thus improve the food service industry. It helps business to carry out best practices in relation to adopt effective products or services so that success can be attained efficiently. Purchasing and supply chain department helps in considering the business operations successful so that standardized services can be created in relation to provide optimum solution so that best results can be attained. It also assists firm to maintain close customer relationship and thus improve the business performance so that success can be obtained (Dimitriadis and Stevens, 2008). For instance, hospitality industry assists in enhancing the purchasing and supply chain department so that restaurant and bar operations can be improved in relation to attain competitive advantage so that success can be attained.
Furthermore, the above statement helps in assessing the fact that delivering standardized quality services assists in using cost control measures so that businesses are able to attain competitive edge over marketplace. Restaurant and bar operations demonstrates the proactive approach to cost control and thus help firm to provide cost control measures so that competitive edge can be attained in market. Gaining competitive advantage assists in improving the financial performance in market and thus improve the market share so that sales and profitability can be attained in an effective way (French, Story and Fulkerson, 2002). It is the best way through which food and beverage operations assists in managing its operations profitable in market. It also assists in improving the business performance so that set targets can be attained in an effective way.
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It is the best way through which competitive edge can be obtained. Hence, it is significant for firm to carry out best practices in relation to enhance the business objectives. Company aims to focus upon delivering quality services to clients in relation to attain competitive edge over customers. Thus, it is a profitable business which assists in managing supply chain management and attain customer service so that set targets can be attained (Gomes and Lobstein, 2011). Business also aims to enhance the customer service and attain competitive advantage in a crowded place.
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- Drake, R. P. and et.al., 2013. The lean and agile purchasing portfolio model. Supply Chain Management: An International Journal. 18(1). pp.3 – 20.
- Evranuz, E. Ö., 2012. Handbook of Plant-based fermented food and beverage technology. CRC Press.
- Ferreira, R. R. and et. al. 2012. Food and beverage levels during the 2008-2010 economic downturn in clubs. International Journal of Contemporary Hospitality Management. 24(4). pp.614 – 627.