Sources Of Supply
SELECTION OF SUPPLIER:- Supplier can be selected among those from the buyer has a previous purchase. Supplier selection may be the single most important decision made in purchasing. It consists of the following phases.
The survey stage: – The purpose of a supplier survey is to explore all possible sources for a product. The buyer experience and personal contacts with various suppliers provide the most valuable and reliable information and should be kept in complete and up-to-date supplier files in the purchasing office. These files should contain the name and address of every supplier with whom a food service organization has transacted business, plus information on products purchased from the supplier. The supplier file can be crossed – referenced with a file of products listing from whom they were purchased, the prices paid, and the points of shipment. To select a new supplier inquiry must be made to cover the following points:
- Full detail of the firm and range of item that they are selling.
- Price list.
- Details of trading terms.
- Samples of products.
- Credibility.
- Full detail of the supplier.
- Goodwill in the market.
The inquiry stage: – In the inquiry stage of the supplier selection process the field must be narrowed from possible to acceptable sources. In general, this process involves comparing potential suppliers to provide the right quality and needed quantity at the right time, all at the right place with the desired degree of service. Quality, quantity, and price should be compared and balanced against one another. Geographic location is a major concerned in evaluating a supplier’s service. Certainly, shorter delivery distances offer better opportunities for satisfactory service. The selected supplier should be the one who keeps current with the technological developments, is capable of providing new and improved products as they become available. Warranty and service offered by an equipment supplier also is a vital concern for the buyer. Another factor to consider is that the financial condition of a supplier is vital for maintaining a satisfactory business relationship. When feasible, a visit to the prospective supplier’s warehouse facilities will give an indication of the efficiency and general cleanliness associated with a good business. The visit gives the buyer an opportunity to observe employees and order handling procedures. After the survey and inquiry stage of selection, the buyer should have a few suppliers from which to choose one or more.
Evaluation of supplier performance-The evaluation of supplier is a continuing purchasing task. Current suppliers need to be monitored to be sure that they are meeting performance expectations, and new ones need to be screened to determine if they should be seriously considered in the future. Buyers, however, tend to use suppliers who have proven to be reliable. The new supplier should be given an opportunity to make a few deliveries to the foodservice operation before performance evaluation. Evaluation should be conducted periodically to keep the suppliers record file up-to-date. Suppliers who have good evaluation will be appreciated knowing the results, suppliers who do not have a good evaluation should be told why before severing the business relationship. After selecting the supplier and having purchased from him it is necessary to evaluate his performance through the rating system. There are three main criteria’s for evaluation:
- PRICE PERFORMANCE: Cheapest item is not necessarily the best to buy. One supplier may be specialized in lower quality goods at a lower price while others maybe vice- versa. Selection of supplier depends upon the standard of quality required.
- QUALITY PERFORMANCE: This is the ability of a supplier to supply constantly desired quality as laid down in S.P.S. consistency in meeting the S.P.S. with a high-performance rating.
- DELIVERY PERFORMANCE: All the required goods should be delivered on time and whenever required by the purchaser. Delay in delivery will increase the pressure at work in the hotels.