- it's also know as procurement
- the process of securing the right product for a facility at right quantity, quality, price, place, time, specification and sources.
- purchasing activity usually are more focus on buying transaction in formal way.
- basic flow of purchasing.
![](https://ppl.app.uq.edu.au/sites/default/files/9.40.01c%20Purchasing%20-%20Guidelines%20-%205.2%20Significant%20Procurement%20Plan%20Process.jpg)
The Market
The medium through which a change of ownership occurs
- Market distribution - product are distributed through a series of channels and transfer of ownership.
Market
Channels
|
Middlemen
|
Brokers
and Manufacturer’s Representatives
|
Broker
|
Manufacturer’s
representative
|
The food processing and distribution system,
beginning with the grower of raw food products and ending at the final customer
or point of consumption.
|
Conduits between manufactures, distributors and consumers.
|
Wholesalers who do not assume ownership of goods but whose
responsibility it is to bring buyers and sellers together.
|
Serves as a sales representative for a manufacturer or group of
manufacturers.
|
Serves as a sales representative for a single manufacturer.
|
2. Market Regulation: U.S. Food and Inspection Program
i. Interstate
commerce
|
ii .Intrastate
commerce
|
iii. U.S.
Department of Agriculture (USDA)
|
Financial transactions (buying and selling of
goods) carried on between states.
|
Financial transactions carried on within state boundaries.
|
Responsible for enforcing the Meat Inspection Act, The Poultry
Products Inspection Act and The Egg Inspection Act.
|
iv. Food and
Drug Administration (FDA)
|
|||
![]() ![]() ![]() |
|||
Misbranded
|
Standards of
Identity
|
Standard of
Quality
|
Standard of
Fill
|
A food product whose label either does not include information
mandated by law or includes misleading information.
|
Defines what a food product must contain to be called a certain name.
|
Set minimum standards for features such as aesthetics of a
product before it can enter interstate commerce.
|
Regulate the quantity of food in a container.
|
![]() |
|||
National Marine
and Fisheries Service
|
U.S. Public
Health Service
|
Environmental
Protection Agency (EPA)
|
Department of
the Treasury ( Bureau of alcohol, tobacco, firearms and explosives)
|
A voluntary inspection system for fish.
|
Concerned primarily with control of infections and contagious disease
but also need to take care about safety of some foods.
|
Setting tolerance levels for pesticide residues in foods,
establishing the safety of new pesticides and providing educational materials
on the safe use of pesticides.
|
Monitoring the production, distribution and labelling of
alcoholic beverages.
|
The Buyer
- A buyer is a member of the professional administration team and is held to high standards of work performance and ethical behavior.
1) The art of negotiation
|
2) Ethics in purchasing
|
·
Negotiation is
the communication skill used by individuals to confer with others to reach an
agreement or compromise.
·
The ability
to negotiate is important to having successful purchasing in very
organizations.
|
·
Ethics is the
science of morals in human behavior.
·
Buying demand
integrity, maturity, negotiation skills and commitment to a high standard of
ethics.
·
The most
important things is no gifts or other favors should be accepted that could compromise the buyer’s ability to make objective purchasing decisions.
|
3)
Structure of
purchasing
|
|
§ The structure of purchasing varies depending on the size and type
of organization.
|
|
i.
Centralized Purchasing
|
ii.
Group and Cooperative
Purchasing
|
ü
Responsible for
obtaining needed supplies and equipment for all units in the organizations is
usually used in many large organizations (university, school, hospital)
|
ü
An organization
that represents member organization and oversees their purchasing function.
|
§ The buyer is selected by the members and maintains an office
independent of the participating organizations.
|
Vendors and Food Distributors
- A foodservice can purchase food and products from a wide variety of vendors.
- Vendor is a seller or sources of supply.
- Foodservice operation can locate vendors through:- i) the internet ii) other foodservice operators iii) trade journals and publications iv) trade shows
- The key responsibility of the buyer is to evaluate carefully the vendor's scope of products and services.
Methods of Purchasing
1) Informal or Open-Market Buying
- a commonly used method of buying, currently used in smaller foodservice operations.
- involves ordering needed food and supplies from a selected list of vendors based on a daily, weekly or monthly price quotation.
- Quotation is an amount stated as the current price for a desired product or service.
2) Formal Competitive-Bid Buying
- written specifications and estimated quantities needed are submitted to vendors.
- it can be quite formal and advertised in the newspaper and copies can be printed and widely distributed.
- it also can be less formal with single copies supplied to interested vendors.
- Bids are opened on a designated date and the contract generally is awarded to vendor that have meet business specifications.
- Competitive Bidding Variations - many variations and techniques that have in formal competitive bidding but it is depending on the type of institution. - bids can be written for a supply of merchandise over a period of time at prices that fluctuate with the market.
3) Variations on Methods of Purchasing
- Cost-Plus Purchasing = a buyer agrees to buy certain items from a purveyor for an agreed-on period of time based on a fixed markup over the vendor's cost.
- Prime Vending = a method of purchasing that has gained popularity and acceptance among restaurant and noncommercial buyers during the past several years.
- Blanket Purchase Agreement = sometimes used when a wide variety of items are purchased from local suppliers.
- Just-in-Time Purchasing = another variation of purchasing.
Product Selection
- Market Forms of Foods - to be purchased is a major decision that requires careful study refers to the physical shape, and temperature.
- Food Quality - the quality of foods most appropriate to the foodservice operation and their use on the menu must be decided. i) Quality Standards = refer to wholesomeness, cleanliness or freedom from undesirable substances. ii) Grades = market classifications of quality. iii) Grading and Acceptance Services = offers official grading or inspection for quality of meat and meat product, fresh and processed fruits and vegetables, poultry, egg and manufactured dairy products. iv) Brands = a particular make of a good or product usually identified by a trademark or label.
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj7Jr7G3S33Bs2i5vb4wb-zD_rcD04y21_9PR3t8hpYskweNiDUOZ6B1GhegQ4QxCjcIXWaKpumeSlf-LGPbQoaqfm9pYcxB6njXyJ_UwgpflvY-JwloLUzeY3wZBL3uXzQMy3Zxh6-4W2q/s640/USDA+stamps.png)
Purchasing Procedures
1) Identifying Needs
- quantities of food needed for production of the planned menus are identified from the menus and from recipe used to prepare them.
- requisition is the action that triggers the purchasing process.
- requisition is an interdepartmental from used to request desired products including food and supplies
i) Inventory stock level
- a system of communicating needs from the production areas and the storeroom to the buyer is essential
- inventory is a detailed and complete list of goods in stock.
- minimum and maximum stock level provides a means of alerting the buyer to needs.
ii) Quantity to buy
- the amount of food and supplies purchased at one time and the frequency of ordering depends on finance and accounting procedures, the methods of buying, the frequency of deliveries and storage space.
2) Specifications
- a detailed description of a product, stated in terms that are clearly understood by both the buyer and the seller.
- the information that have included in all specification for food products:- - name of the product - federal grade or brand - unit on which price is quoted - name and size of container - count per container or approximate number per pound
- additional specifications:- - fresh fruits and vegetables - canned foods - frozen foods - meat and meat products - dairy product
- an invitation to bid provides vendors an opportunity to submit bids for specific items needed by a buyer
![](https://resource.ips.tennessee.edu/sites/default/files/Request%20for%20Bid%20Form%20Sample.png)
4) Developing Purchase Order
- the process for authorizing purchase differs in various foodservices
- purchase order is written request to a vendor to sell goods or services to a facility
- Bids should be kept sealed and confidential until the designated time for opening.
- receiving after the time and date specified for bid opening must be rejected and returned unopened to the bidder.
- should be under the control of an appropriate official
- the points should be considered before accepting bids:- a) ability and capacity of the bidder to perform the contract and provide the service b) ability of the bidder to provide the service promptly and within time specified c) integrity and reputation of the bidder d) quality of bidder's performance on previous contract or services e) bidder's compliance with laws and with specification relating to contract or service f) bidder's financial resources
- the contract should be awarded to the most responsive and responsible bidder with the price most advantageous to the purchaser.
- purchasing should be on the basic of price, quality and service.
- influence the function of purchasing.
- the buyer is responsible for understanding and complying with the law, regulation or policy i) Laws and Contract Management - the purchase/sale exchange between buyer and seller is a legal and binding commitment even if made in good faith. - Uniform Commercial Code (UCC) used to protect the buyer from deceptive practices on the part of the supplier. - 3 major protection:- a) Laws of agency b) Laws of warranty c) Laws of contracts ii) Laws Relating to competition and pricing - can influence the purchasing function relates to issues of fair competition and pricing - the 4 major laws:- a) Sherman Act b) The Federal Trade Commission Act c) The Clayton Act d) The Robinson- Patman Act
No comments:
Post a Comment