Think you're saving money by constantly switching suppliers? Think again.

The Myth of Competitive Bidding

You might think that constantly engaging in competitive bidding and price shopping will save you money. In reality, it's a time-consuming process that distracts you from activities that yield higher returns, such as improving customer service or training your staff.

Moreover, large restaurant chains usually stick to one primary supplier for 80% to 100% of their food products. These chains tend to be 2-3 times more profitable than independent restaurants. Coincidence? Unlikely.

The True Cost of Supplies

Understanding your supplier's cost structure can help you negotiate better deals. Here are the four main elements:

1. Product Costs: The price your vendor pays to their suppliers.
2. Administrative & Selling Costs: Costs related to account management and order processing.
3. Delivery & Handling Costs: Costs related to delivering the product to your restaurant.
4. Profit on the Account: The supplier's markup.

The goal is to make it more profitable for your supplier to do business with you. By reducing their costs in serving your account, you can negotiate for lower prices.

The Prime Vendor Program: A Win-Win Strategy

A 'Prime Vendor Program' involves a non-contractual agreement to buy a significant portion of your total food supplies from one primary supplier in exchange for a fixed markup. This approach benefits both parties in several ways:

1. Reduced Food Costs: Your food costs can drop significantly. For example, one of our customers have been able to reduce their food cost by 10% by partnering with bulkbox.
2. Fewer Vendors: Dealing with one or a few vendors simplifies your operations.
3. Time Savings: With fewer vendors to manage, you save valuable time.
4. Improved Service: A dedicated vendor is often more responsive to special requests.
5. Consistent Quality: When you stick with one supplier, you're more likely to maintain quality standards.
6. Strengthened Vendor Relationship: A strong partnership ensures better attention and service.

Building Trust: A Two-Way Street

Trust is crucial in a prime vendor relationship. While there's always a risk that your supplier might hike prices, a long-term partnership is usually a strong deterrent against such practices. If you're worried about this, make sure to reassess your vendor relationships regularly.

Is the Prime Vendor Program Right for You?

To find out, give it a try. Most operators who have switched to a prime vendor program say they’d never go back to the bidding war. It's a smarter, more efficient way to manage your food costs, especially for busy restaurant owners in Kenya.

At BulkBox, we offer a comprehensive all-in-one supply chain solution that can serve as your reliable prime vendor, making it easier to manage your restaurant's needs.

Remember, the objective isn't just to find the cheapest supplies but to cultivate relationships that offer the best value. In the restaurant business, sometimes the cheapest option isn't always the best one.