Top 10 tips to reduce your cost

We understand the complex journey hoteliers face every day, and as the cost of living crisis, Brexit and recruitment challenges all continue to bite, we offer some timely tips on what changes can be implemented now to help make a difference: Centralise Purchasing Regardless of whether you’re running a single site or multiple location operations, having a centralised procurement system that can be accessed by management, chefs, and finance is the key to keeping costs under tighter control. It will provide a single source of truth on what is being spent and on what, giving you far more data and intelligence on which to make decisions or changes. Our clients are able to use our own in-house eProcurement system Pi, free as part of our service offering. Conduct a Review of Products Many hotels have to oversee at least 28 categories, and therefore a great starting point for any cost review is to consider what product lines you are currently using and whether changes can be made to reduce spend. This doesn’t simply mean compromising quality either: instead, we consider pack sizes, delivery frequency, remove duplications and more. Undertaking a review of a typical basket and assessing what changes can be made or where purchases can be consolidated will mean better deals can be negotiated. Consolidate Suppliers It is not uncommon for hotels to have multiple suppliers in place. Savings can however be made by consolidating to a smaller group of suppliers, or even to a single supplier if appropriate, in order to achieve efficiencies of scale and improve drop size. Deliveries With fewer suppliers, you may reduce delivery volumes which reflects in prices. As an example, I am working with a hotel at present and have been able to reduce deliveries from 28 across a 7-day period, to 21 without compromising quality, matching 100% of the basket and reducing cost. This also has a positive sustainability impact, fewer trucks coming up the drive has to be a good thing! Price tracking Are you paying the right prices? Instead of mundane manual checks, use an online system that can automatically check every product line against agreed contractual prices to ensure that there are no discrepancies and that what is being invoiced is correct. Also, do you currently do a daily ‘food flash’? Tracking what is being purchased and delivered each day, versus what is going out gives you a barometer to monitor gross profits. You can track this manually, however, if you’re using a system like Pi, it will do this for you automatically. Review Menus How often do you review your menus or menu engineering? Do you know how much profit you are making on individual dishes? How do you ensure that any retail price adjustments are timely made to your menus? We work closely with clients to support menu creation and our Pi tool automatically calculates theoretical gross profit-based spend versus retail price on each and every dish. Control stock, portion and wastage If you’re able to control stock, portions and wastage, you can make great strides in improving your margins. Online menu and stock management modules can work together to provide accurate costings while tracking stock usage, wastage and transfers. It will also help to ensure you are not over-ordering and having to store – and pay for – stock unnecessarily. Reduce Administration If you are able to help your team reduce the time they are spending on administrative or manual jobs, it means they can concentrate on what they are there to do. Working in a more centralised, transparent way will, in a small part, help to boost team morale. Accept Help from Specialists We have decades of experience in helping operators within the hospitality industry in identifying savings and efficiencies and we would be happy to support you in achieving your goals. As Henry Ford was famously quoted as saying “If you always do what you’ve always done, you’ll always get what you always got,” and I for one believe that it is important for us all to take stock and consider what changes can be made operationally today, which will support the business during this difficult period and moving into 2023. https://pelicanprocurement.co.uk/ hello@pelicanprocurement.co.uk