Edward Zimmerman has over 40 years in the food and hospitality industry and currently uses all of that experience as President of The Food Connector, a company that develops marketing plans for small to mid-size food manufacturers and distributors.
He is also the former President of
pizza.com, Successfoods Marketing, and has done business in all 50 states (even North Dakota.) In this value-packed episode he explains the power of group purchasing and the benefits it can bring to restaurant owners. Here are a few of his main points:
1) You may have a good price, but you don’t have the best
Food manufacturers dictate pricing based on volume. Usually, a higher volume equals lower prices. So the idea behind group purchasing is that many parties can pool their orders together leading to a lower price for everyone. It’s a win-win-win: Manufacturers like the relationships they build with individual restaurants, distributors like giving discounts that don’t come out of their pockets, and restaurants pay less.
2) Take your ego and emotion out of buying
Group purchasing does require restaurant operators to change the way they buy, which can be hard. Edward has seen operators deny group purchasing because they claim they “don’t need any help” doing what they’ve been doing for years. But if egos can be set aside, there are savings available.
3) Partner with distributors
Edward pointed out that distributors are a valuable resource because they see the best-practices of many restaurants and can share them with you.
4) Look into group purchasing
If you want to get started, Edward suggests a few criteria when evaluating which group you should join. First, the services for chains differ from those for independent restaurants, so find a group that fits your situation. You’ll also want to check out what types of discounts are offered, such as contract pricing, rebates, etc. Then, make sure there aren’t any long-term contracts required for entry – that’s a red flag. You should be able to opt-out if it’s not working for you.
