In the ever-evolving world of restaurant management, staying competitive and profitable is a perpetual challenge. One innovative approach that has gained traction in recent years is the concept of a consolidated supply chain.

For this article, we chatted with one of our Operations Consultants - Julie Delion - to explore the advantages and potential pitfalls of this strategy, and we offer insights on how restaurant owners can successfully implement a consolidated supply chain…

Julie Delion - Operations Consultant Twice Baked

The Benefits of a Consolidated Supply Chain

Streamlined Operations: One of the most significant advantages of consolidating your supply chain is streamlined operations. Reducing the number of orders the manager has to place each day/week and reducing the number of deliveries the team has to receive, allows them to focus on delivering great customer service and running efficient shifts!
Cost Savings: Consolidation often leads to better pricing and terms with suppliers, thanks to the power of economies of scale. Additional labour cost saving is also achievable. By consolidating your supply chain and utilising a procurement supplier partner you can hold off hiring a procurement manager for a while (typically until you reach around 10-15 sites) which can equate to a cost saving of over £80,000 per year.
Enhanced Efficiency: With fewer moving parts, communication and coordination within your supply chain become smoother, minimising the risk of errors and delays in deliveries. This will also enable more efficient new product development, and new site openings, allowing you to focus on running your operations rather than having to deal with product shortages, price increases, sourcing additional lines...
Scalability: A consolidated supply chain provides a structured framework that allows your restaurant to scale and grow more easily. This agility is essential for meeting increased demand and expanding your business.

The Challenges of a Consolidated Supply Chain

Supplier Transition: Shifting from multiple suppliers to a consolidated supply chain can be challenging as it may require renegotiating contracts and adjusting established relationships. This can also lead to forced product spec and recipe adjustments if the new product sourced has different specifications.
Employee Resistance: Team members, including procurement managers and kitchen staff, may resist changes to their roles and responsibilities, requiring effective training and communication.

Implementing a Consolidated Supply Chain: A Roadmap

Map out your supply chain: Literally draw a map of all your suppliers, ordering process and numbers of deliveries. This will allow you to understand how many orders and deliveries your team has, and how many relationships you have to work on and maintain with your current suppliers.
Assess your current suppliers: Begin by assessing your existing suppliers. Identify those who can provide a broader range of products and meet quantity requirements while maintaining quality and reliability. Send your basket for tendering to your current suppliers and potential bigger players.
Retain your niche suppliers. If you are using bread, maintain your favourite baker. If beef is your USP, stay with your local butcher. Work on consolidating mainstream products such as veg, dry goods, packaging and cleaning supplies.
Renegotiate contracts: Engage in negotiations with selected suppliers to establish favourable contracts aligned with your consolidated supply chain strategy. Negotiate volume discounts, service level agreements, and other beneficial terms.
Monitor and adapt: Continuously monitor the performance and effectiveness of your consolidated supply chain. Solicit feedback from internal stakeholders and be ready to adapt your strategy to address challenges and seize opportunities.
Invest in technology: Consider investing in supply chain management software and ordering systems to facilitate the transition and streamline operations.
Training and communication: Ensure that your staff, from procurement managers to kitchen teams, receive adequate training and communication regarding the new supply chain processes and roles.
Evaluate and refine: Regularly assess the impact of your consolidated supply chain on your restaurant's operations and profitability. Make data-driven decisions to refine and optimise the supply chain further.

If you’re struggling with your supply chain, and want to discuss your options with our team of experts, please reach out at info@twicebaked.uk!

The Benefits and Challenges of a Consolidated Supply Chain for Restaurants