CUT YOUR CLOTH ACCORDINGLY

Self-control and moderation

– the Presbyterian modus operandi for much of Scotland in years gone by has been replaced with a more sybaritic way of life in recent decades.

However, we are now caught in what seems like a never-ending series of cost calamities from green energy to red peppers and everything in between, the prices just keep on rising. Procurement well executed will help mitigate these cost increases and assist businesses to do as well as they possibly can with the resources they have available, however, limited they may be.

It is a good time to get creative across your business or enterprise and deploy the principle of cutting your coat according to your cloth – meaning do not spend more than you have or can afford to repay. Ultimately aim to be more productive with less waste, always focusing on quality and leveraging your supplier relationships to keep your business front of mind with your core supply chain to provide you with alternative options which do not compromise your product offer. Also, push back when faced with price increases and seek to share the burden with your suppliers. In most situations, they will be pragmatic and look at the longerterm relationship opportunities to find a way that works for both parties.

Inspire your teams to find ways of doing more with less and you will likely discover a plethora of untapped ideas from their own personal and employment backgrounds that can help make the difference to maintain margins and ambitiously improve them despite the often gloomy economic outlook perpetuated in the media. There are commentators who argue that lots of the negatives are already baked into the economy and there really are lots of growth opportunities in the year ahead. It is better to focus on those and push ahead with plans to develop your businesses.

Look for ways to continuously improve with the resources at hand and look at product swaps for your usual proprietary branded items in your basket of consumable purchases. There can be obviously good reasons why a wellknown brand is the sector leader but if it doesn’t make a difference to the guest and customer experience and often it is simply operator preference exercise judgement and work out if it really makes a tangible difference. In nine out of ten scenarios, it will make no difference and you should bank the saving to the bottom line.

When buying items enquire about the cost build-up and why an item is priced the way it is – the objective is to determine how much is supplier margin and place the focus on minimising that aspect. When gathered together, applying various clothcutting strategies will see you through the tough times to brighter days ahead.

For information on how to Cut Your Coat.. And Your Cloth Accordingly contact alastair@aroprocurement com www.aroprocurement.com