Class Notes (836,213)
Canada (509,690)
FNS 200 (13)
Lecture

PROCUREMENT.doc

6 Pages
152 Views
Unlock Document

Department
Nutrition and Food
Course
FNS 200
Professor
Donna Barnes
Semester
Fall

Description
PROCUREMENT (Week 10) Procurement process -Procurement is defined as systematic exchange b/w a seller & buyer to obtain goods & services which incl determining the types of products needed, making purchases, receiving & storing shipments & administering purchase contracts; those responsible for it is called Director of Procurement/Purchasing director. -Purchasing is the activity concerned w/ the acquisition of products; the right product, in right amt of time & at the right price. If the person doesn’t understand food, it can become a problem when there is a need for substitutions. The central purchasing dep is the person who identifies product needs & have other dep they are purchasing for. -The buyer is the one who listens to the desires of customers, who determines what is grown & packaged & who understands how items are processed/manufactured, shipped, sold & consumed. Buyers need to be skilled in interpersonal comm., customer focus, making decisions, negotiation & analytical ability, managing change, conflict resolution, problem solving, influence & persuasion & comp literacy. -Purchasing can be viewed as: the profit center (generates revenues greater than expenses & creates profit for the org.) & the cost center (has expenses but do not generate profits to cover expenses). In a hosp-based environment, the profit center is the cafeteria, kiosk vs. the cost center is the patients; there’s a budget for each patient that doesn’t depend on revenue. Marketing Channel -the market is the medium through which a change in ownership moves commodities from producer to consumer. -The producer is someone who produces raw food to sell. The processors/manufacturers are org that takes raw food items & transforms them into packaged products for sale to customer in foodservice ops. The distributor is the wholesaler responsible for transferring products from processorsupplier; classified as the wholesalers (purchases from various manufacturers/processors & provides storage, sells & deliver products to supplier), brokers (independent sales & marketing rep who contracts w/ manufacturers/processors/ prime-source producers to sell local marketing programs w/ wholesalers, suppliers/ foodservice ops) & manufacturer’s rep (represents a manufacturing company & informs suppliers of products by this manufacturer). The supplier is the org that offers products for sale. The customer is anyone who is affected by a product/service. Sustainability in purchasing -involves the origin of product, type of packaging, composition of product & waste generated. -What are the benefits of buying locally? Aiding the local economy, maintaining good public relations, buying food in smaller quantities & having fresher food, reduces use of fossil fuel for transpo & gas emissions, dec dist food needs to travel & provides food w/ face, high recycled content & less packaging, healthier & safer for employees & customers, less toxic, minimally polluting, more energy efficient & fragrance-free. -What are the obstacles of buying locally? Ability to purchase these foods the entire year, having access to sufficient quantity to meet the op’s needs & often having to work w/ multiple growers to obtain quantities needed. -Hospitals don’t necessarily buy local b/c of seasonal availability of most foods, they need to have a year round purchasing contract b/c of seasonality & the ability to supply food routinely (even if you can buy potatoes locally all year, can they handle vol of 300 patients; it’s only an item out of many so it’s possible but need a diff perspective. Value-added -The inc in value caused by both processing/manufacturing & marketing/distribution, exclusive of the cost of materials, packaging or overhead. The objective of value added is to inc the marketing value of raw & semiprocessed product. Eg. you can buy already peeled potatoes esp if you need that for some dishes but wouldn’t it be easier to buy unpeeled ones & just keep the skin on?—depends on the dish or may compromise appealing quality. Eg. AP flour—value added cost for this incl miller, research scientist, necessary production facilities & distribution Market Regulation -Government: enacts federal legislation that protects consumer. Promotes competition among industries. -Industry: satisfies consumer while making profit. Responsible for complying w/ legislation. -Consumer: alerts gov’t about food safety, nutrition & environment concerns. Expects industry to produce appropriate products. Value Analysis -A methodical investigation of all components of an existing product or service with the goal of discovering & eliminating unnecessary costs w/o interfering w/ the effectiveness of the product or service. Ie. Used for cost reduction; important in enhancing eff & profitability. -In foodservice, the essence of quality is suitability. Eg. A supplier gives the buyer the quality of product identified in the specification but part of the price is due to packaging, storage, production & financial management features that are not suitable for the product used in foodservice, a simpler package would’ve been adeq & likely to be less expensive. -How is a value analysis conducted? Value is the result of the relationship b/w the price paid for the item & its use in the function it fulfills. 1 product is evaluated, problem is stated, products evaluated, methodology, results (cost evaluation) & recommendation. -Product selection: what is involved in the knowledge of purchasing? Buyers must know not only the products to be procured but also the market, buying procedures & market trends; how the materials are produced, processed & move to market; must be able to forecast, plan, organize, control & perform other management-level functions. The primary function of the buyer is to procure req products for desired use at minimal cost. Make-or-buy decisions -The manager has 3 basic choices for the production of a menu item: produce item completely from raw foods, purchase some ingredients & assemble & purchase item in final form from the wholesaler. The 4 factors whether a menu item will be purchased is quantity (right size, not too big/small), quality (tastes good), service (reliable delivery & predictable service) & cost (comparing cost from supplier w/ estimated cost of making the product) -Sometimes depends on the price (Jello made from scratch/ready-made), availability (kosher, pureed foods) or type of equip (potato peeler) Types of Specifications: statement readily understood by buyers & suppliers of the req quality of products incl allowable limits of tolerance, ie. A list of detailed characteristics in a product for a specific use. -Technical=indicates quality by objective & impartial test results, eg. size, weight, parts & metals in equipment like aluminum/stainless steel, detergents/cleaning compounds used; particularly applicable to graded food items. -Approved brand=indicates quality by specifying brand name/label, branded products captures customer’s attention, eg. Heinz ketchup, Pepsi, Coca-cola -Performance=indicates quality by functioning characteristics of product, eg. effectiveness/efficiency of equipment, pH levels of detergent, # dishes to be washed/min. Writing Criteria for specifications -Good specifications are: -clear, simple & suff specific -consistent w/ products/grades on the market -verifiable by label statements, grades, weight determination, etc. -fair to supplier & protective to buyer (eg. if supplier ships you the wrong product & you clearly specified what you wanted, you could be granted a refund) -realistic quality stds -capable of being met by several bidders to enable competition Specific info -Specifications for food products should incl: name of product (trade or brand)/std; federal grade, brand or other quality designation; capacity of container (weight, can size); count per container or approx # of lbs (# of pcs if applicable) & unit on which price will be based. Methods of purchasing -Informal: price quotations are given & orders are made by telephone or personally w/ a salesperson, often used when time is critical. Done if the amt of purchase is so small that time req for formal purchasing can’t be justified; an item can be obtained only from ½ sources of supply; need is urgent & immediate delivery is req; stability of market & prices is uncertain; & size of op may to small to justify formal procedures. Have little legal force. -Formal: tax supported institutions usually are req to use competitive bidding which is optional for private institutions & c
More Less

Related notes for FNS 200

Log In


OR

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit