Chapter 3: Quantity Food Purchasing

the process of obtaining goods and services in a form that meets pre-established standards for quantitiy, quality, and price

What are the five purchasing objectives?

as a means by which goods and services are exchangd through transactions between buyers and sellers

provides the basic source of supply to include growers, manufacturers, and processors

includes farmers, ranchers, and raisers producing fresh food products to foodservice operations

controls the production of items from raw materials, provides non-food supplies

intermediaries/middlesmen that obtains the supply of goods from the primary market and distributes them to local buyers

purchases directly from growers, manufacturers, and processors for resale and delivery

agents who represent one or more primary sources that do not employ their own sales workforce

more involved in the trade of equipment and furnishings as brokers are to the trade of food and non-food supplies, may also engage in additional end-user services like delivery

exclusively work for one primary source, representing them in a specific geographic area

owned and operated by a large foodservice organzzation that intends to sell and ship products to company-owned restaurants and franchises

cash-and-carry operations that serve small-scale businesses, which are not qualified for bulk deliveries

are a group of independent purchasers who join together to purchase collectively in order to obtain more competitive prices

Provides a method of communicating among sources, intermediaries, and retailers, allowing them to connect and set-up procurement relationships

sellers of products and services in the local maket

a separate purchasing department is responsible for purchasing decisions

authority to purchase is granted to local branches or departments according to their requirements

also known as open-market buying, that is applicable to smaller operation and involves ordering supplies from a selected list of suppliers on a daily, weekly, or monthly price quotations

an amount stated in current price for a desired product or service

written specifications and estimated quantities needed are submitted to vendors with an invitation for them to quote prices, within a stated time, for the items listed

detailed descrption of a product stated in terms clearly understood by the buyer and seller

there is a formal agreement with a single vendor to supply the majority of the product needs

bringing the buyer's level up to par, and used for items with standard usage pattern (ex. staples)

type of purchase order designed to consolidate routine, low value, and repetitive purchases

involves a "landed cost" plus an agreed mark-up

keeps as little inventory as possible, strategy to buy product in the exact quantities

involves a group of independent purchasers who join together to purchase collectively in order to obtain more competitive prices that can them money in the long run

cash-and-carry operations that are patronized by small businesses who do not order enough products from distributors to qualify for deliveries

satisfactory settlement on price reduction, discounts on bulk purchases, and reducing packing charges

purchasing of foods which are regularly required and based on historical data

involves creating a list of suppliers with price quotatioons

passive investment strategy that allows for bulk purchasing and takes delivery of the entire shipment

buyers purchase a large amount but arrange for the supplier to store it and deliver a little at a time

determining trends for better purchasing options

bound by a futures contract that allows for purchasing large volumes at a specific price at a set date in the future

used to obtain competitive bids for several products from two or more suppliers

items of lower cost are suggested by suppliers

suppliers are willing to lower purchase price of good providd that they are paid on cash basis in advance, at the time of delivery, or shortly thereafter.

considers purchasing products in adequate, not luxurious packaging materials, or large volume packs

price rebate from the supplier is granted provided that the buyer's company uses the product to promote retail sales

provides low AP price for new products in the market; taken advantage by stocking up as these offers are temporary

night and very early morning delivery to increase delivery efficiency

refers to the amount of product that should be on hand until the next delivery. can change based on product demands and delivery times

stock is allowed to deplete to safety level, termed as the minimum stock level, before as new order is submitted to bring level up to maximum, termied as the maximum inventory level

interdepartmental form that lists items or services that a particular department needs, grants the buyers the authority to procure items listed in this form

a written request to a vendor to sell goods or services to facility

refers to the component of the standardizzed recipe in which the product will be used

refers to the exact name of product desired

refers to an overall quality index based on the assessment of food characteristics

includes portion size, weights and dimensions

refers to minimum edible yield of the product desired

6 Rs of Purchasing?