OH 3-1

Agenda

Chapter Two- Key terms review

Chapter Three – The Purchasing Function

Chapter Three – Key terms review

Chapter Four – The Procurement Process & Supplier Selection

Inventory Book Set-Up

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Key Term Review

Blanket order discount

Buyer’s authority

Buyer’s responsibility

Cash discount

Free sample

Job description

Job specification

Kickback

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Key Term Review continued

Promotional discount

Purchasing skill set

Quantity discount

Reciprocity

Steward sales

Volume discount

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Quality Standards in Purchasing

Inventory and Purchasing

3OH 3-4

OH 3-5

Chapter Learning Objectives

Identify and communicate quality standards.

Identify factors contributing to the establishment of quality standards.

State why it is important to convey and adhere to quality standards.

Describe buyer considerations when conducting a make-or-buy decision.

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Quality Standards

Identify and communicate in writing a record of purchasing criteria, product standards and specifications for

Managers

Vendors

Employees

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Quality Standards continued

Clearly communicate product and service standards and requirements to staff and suppliers to avoid ordering and shipping errors.

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Quality Standards continued

Identify an operation’s specific product or service requirements for bid purposes.

In most cases, bid buying results in Lower prices

Consistent quality

Reduced paperwork

Lower purchasing-related labor costs

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Quality Standards continued

Allow an operation to clearly identify acceptable replacement items

For use when Requested products are unavailable

Product demand exceeds requested product supply

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Quality Standards continued

Improve the ability of employees to identify and prepare menu items by providing Consistent yield

Predictable trim

Constant viscosity (thickness or flow)

Predictable plate coverage

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Determining Quality Standards

Quality standards are based upon the style of restaurant and its needs for products and services.

Resources available when developing quality standards include Purchasers

Suppliers (vendors)

In-company personnel

Outside consultants

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Product Specifications

Product specifications specify exactly what an operator is seeking to buy from its vendor.

In this case, the operator is the customer, and the vendor must fulfill the customer’s needs.

It is easiest to fulfill customers’ needs when they are clearly known!

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Product Specifications continued

An item’s intended use is its most important characteristic when specifying quality standards.

Intended use addresses In what form?

In what size?

At what temperature?

At what stage of processing?

In what packaging?

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Product Specifications continued

Specific information includes: Yield

Packaging

Color

Quality level

Grade

Count

Size

Temperature

Processing requirements

Shipping methods

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Product Specifications continued

The exact name is used to identify, as closely as possible, the desires of the buyer.

Food names may vary by region

May include sizes and other factors

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Product Specifications continued

Brands can be indicators of quality.

Operators may prefer to buy a brand name.

Guests may prefer to see brand name products served to them.

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Product Specifications continued

When products come in different packaging formats, product specifications must be very exact.

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Product Specifications continued

Item size will, in many cases, directly affect portion cost.

Size may refer to Weight

Volume

Count

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Product Specifications continued

Acceptable trim indicates the amount of allowable waste acceptable upon delivery.

Excessive trim will increase portion costs.

Excessive trim reduces profits.

Purchase prices typically increase as trim loss is reduced.

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Product Specifications continued

Grade is an indicator of quality.

The United States Department of Agriculture (USDA) grades are recognized standards in the foodservice industry.

In most (but not all) cases, grading is not mandatory.

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Product Specifications continued

Market form indicates how an item is processed prior to packaging.

Examples include Whole Diced Shredded Chopped Fresh Frozen

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Product Specifications continued

Color is an indicator of age and identification

Age examples include Green bananas Red strawberries

Identification examples include Green beans Red grapes

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Product Specifications continued

Accuracy in menu legislation requires that places of origin, if used on the menu, must correctly reflect the true origin of the item sold.

For example “Idaho Rainbow Trout” must actually come from

Idaho.

“New York Cheesecake” must come from New York.

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Product Specifications continued

When designating acceptable substitutes, it is always best not to reduce quality standards!

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Product Specifications continued

Unit Pricing Pricing by

The dozen The case at an agreed-upon case size Alternative units

Price Limits Buyers may predetermine the maximum

price (limit) they will pay. Examples include prices for fresh lobsters and other types of rare seafood.

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Product Specifications continued

Temperature control procedures

Room temperature

Refrigerator temperature

Frozen (freezer) temperature

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Factors Affecting Quality Standards

The item’s intended use

The operation’s concept and goals

The menu

The skill level of employees

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Factors Affecting Quality Standards continued

Budgetary constraints

Customer’s wants and needs

Seasonal availability

Availability of storage

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Make or Buy:The Case for Buying Food

Buying food in a partially or fully prepared state: Ensures consistency

May be cost effective because product waste is reduced

Saves time

Saves storage space

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Make or Buy:The Case for Making Food

Quality may be better.

Guests’ satisfaction may be higher.

Food costs are generally lower.

Signature dishes are easier to develop.

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1. Product (specifications/standards) identify the characteristics desired in a product or service purchased by a foodservice operation.

2. Which of the following is not a category typically used to develop product specifications?

A. BrandB. Delivery timesC. SizeD. Packaging

3. Employee __________ __________ is an important factor affecting quality standards.

4. The final quality of a “made from scratch” item will always exceed the quality of a purchased item. (True/False)

How Would You Answer the Following Questions?