The Organization and Administration of Purchasing

The Organization and Administration of Purchasing6YOU SHOULD BE ABLE TO:Describe the methods used to plan and organize the purchasing activities of a hospitality operator.Recognize the issues involved in administering purchasing activities.YOU SHOULD BE ABLE TO (CONT.):Differentiate the purchasing organizational pattern between small independent, medium independent, and multiunit hospitality operations.Explain the advantages and disadvantages of centralized purchasingTHE ADMINISTRATIVE STAGES OF PURCHASINGPlanningOrganizingStaffingTrainingBudgetingDirectingControlling – direct vs. indirectPLANNINGObjectives of purchasingMaintain adequate supplyMinimize investmentMaintain qualityObtain lowest possible edible-portion (EP) costMaintain competitive advantageORGANIZINGIndependent OrganizationsChain OperationsINDEPENDENT OPERATIONSIndependent operationsSmallMedium-sizedLargeCo-opCHAIN OPERATIONSLocal unit levelCompany-owned storesCentralized purchasingSTAFFING Process of recruiting, hiring, and training personnel to perform specific tasks in an organization.TRAININGEntry levelJob and company orientationFormal instructionOn-the-job trainingTRAINING (CONT.)Professional Training OptionsNational Restaurant AssociationNational Restaurant Association Educational Foundation (NRAEF)Institute of Supply Management (ISM)North American Association of Food equipment Manufacturers (NAFEM)BUDGETING Budgeting – a realistic statement of management’s goals and objectives, expressed in financial terms.CONTROLLING Controlling – systems and procedures used by managers to ensure that the actual costs of doing business are consistent with the expected (or budgeted or theoretical) costs.