The food service industry is booming, and in this fast-paced and cutthroat industry, nobody has time to waste on mistakes, bad planning, and poor communication. As a restaurateur, you know that your menu is only as good as the ingredients you use, so filling your supply room with the freshest and tastiest foods is a top priority. If you're new to running a food service business, you may have noticed how hard it is to get a contract with the best restaurant food suppliers.
If you haven't had to navigate the food suppliers maze before, you probably wonder why it's so difficult. It's a simple reason though. The best food suppliers only want to work with restaurants and food services that have a good reputation. Why should food suppliers care about your reputation? Isn't it all about money anyway?
Nope. Think of it this way - If your customers are always getting sick at your restaurant, or the health inspectors keep closing you down or handing you fines, that's going to look bad for whomever you bought your supplies from. Restaurant food suppliers don't want to risk their reputations, and so they have every right to refuse to work with companies that haven't proven themselves.
Maybe it seems like an impossible task, or maybe you're lucky and haven't had to run the food supplier gamut just yet. Either way, we've got you covered. This article is all about preparing your restaurant and your offers to impress the highest-quality restaurant food suppliers, and making them want to work with you.
There is no such thing as too much preparation, and getting your business ready for contract negotiations with restaurant food suppliers is no different.
1. Research the Top Five Food Suppliers in Your Local Area
Focus on local companies, to reduce transport costs, but don't be afraid to widen your search if a very good supplier is just out of reach.
2. Check Out the Company’s Current and Past Clients
You may learn something about the food suppliers by seeing who they send their ingredients to.
3. Scan the Company's Website
Most restaurant food suppliers do not list their prices on their websites, as costs are saved for private negotiations. However, you can find out a lot about a company by perusing their website.
4. Make a Food Cost Budget
Before you can make any offers or agree to any contracts, you need to understand your finances and what you can afford. If you're already in business, get an accurate inventory count and run some numbers to see what your current food cost sheets look like. If you don't have the restaurant open yet, you still need to figure out how much you can afford on that first order. Don't skip this step! Negotiations will fail if you walk in financially blind.
After you've learned all you can about the top five restaurant food suppliers you'd like to work with, it's time to prepare your action plan and your offer(s). This step will vary from company to company, so make any changes you need before you present your package. Use your food cost sheets from step one to make your offers, and stay within your budget.
How will you approach the food suppliers? Will it be a phone interview, via email, or will you make an appointment for a face-to-face meeting? You should have a list of questions ready to go, but don't just use the same ones for every company. Each prospect should get a list of questions tailored to them. Of course, you'll want to discuss some of the same things with each company, but ask questions about them, not just their products. It will show the food suppliers that you're taking an active interest in more than just good prices and saving a buck. Food suppliers want long-term, reliable, loyal clients—show them that is you.
Inventory Control Matters
Even if you haven't opened your doors yet, inventory control matters. How will you handle inventory counts? What do you plan to do about ordering inventory? Do you have access to mobile apps or web services that allow for real-time inventory updates and order placing? Many of the best restaurant food suppliers have switched to a completely digital ordering process, so make sure you're prepared.
Make Two or Three Offers
Hopefully, they'll accept your first offer, and your two back up offers won't ever have to be shared. However, negotiations can be brutal, so come prepared with two backup offers just in case.
In addition to the interview questions and the "getting to know you" portion of your meeting, you should have a list of the following questions on hand once negotiations begin. Keeping your budget in mind, get the following information from each food supplier.
- Payment terms and options
- Prices, and if there are any discounts for larger orders
- Where they get their supplies (this is so you can be sure of the quality)
- Delivery options—How? When? Other options?
While nobody likes hanging out with a cocky, over-confident person, there is something to be said for a professional level of confidence. You don't want to be overbearing, but you also do not want to appear weak. Even if you're nervous talking to the big guys, you need to show confidence and a self-assured posture. Be ready to negotiate hard. Unless they offer you outstanding and unbelievable prices well below your original intentions, it's usually best not to accept the first offer. Haggling prices and how to do it well is beyond the scope of this article, but it's not too hard to do. Keep your inventory sheets handy, as well as your budget, and you should be fine. To look extra professional, don't shuffle papers searching for all your notes. Instead, get all of your business' inventory and ordering information on apps, so you can easily find what you need with the tap of a finger.
It's just that simple to get in good with the big names in restaurant food suppliers. It all boils down to being prepared and walking into the meeting with confidence and lots of facts to back up your position. Once you snag your contract, you're ready to succeed! We hope these four tips have helped you get a better grasp on how to be prepared to communicate and negotiate with food suppliers. If you're looking for more information to get a better handle on your inventory management and order processing before meeting with suppliers, check out our article on "How to Choose the Best Inventory Control Software for Small Businesses" also on the Hubworks Blog!