Single-sourcing keeps it simple
Monday 29th November 2004 19:10
As one of the UK's biggest buyers of catering equipment, Compass Group is frequently targeted by manufacturers. Little wonder, since Compass brands range from Upper Crust in the retail sector, Eurest in staff restaurants and brands such as Ritazza, which appear in both retail and food service.
There's little in catering equipment that Compass hasn't a need for, and the buying team at Sevita - the purchasing division of Compass - looks globally at what equipment best suits the different Compass brands and client services.
But Compass Group has a very specific policy on buying equipment. There may be 60-odd combi-ovens in the marketplace, 100-plus deep-fat fryer brands to choose from, and countless fridge manufacturers, but we work on the general rule of two - one key supplier and one secondary supplier for each part of the business.
That's not to say we have two equipment options for the whole of Compass Group. Each operation in the business has different performance needs and there's no point in putting heavy-duty equipment where medium-duty will meet the need, and the other way around.
Restricting the number of suppliers for a piece of equipment makes good business sense for Compass. The integrity of the Compass brands is critical. Having the same item of equipment throughout a brand means we understand every aspect of the piece of equipment. It has been evaluated by the Sevita buying team for performance and practicality, and will be the best for the job.
There's also the financial advantage of single-sourcing with a brand that may run across several countries. Compass always prefers to negotiate directly with a manufacturer on price. We recognise the role of the distributor for delivery and installation, and we agree a management fee for this.
Because of the volumes involved in catering equipment purchasing, there's never a shortage of manufacturers wanting to supply us. While the Compass buying team visits the major equipment exhibitions of Europe and through our North American operations keeps abreast of new developments there, Compass is always willing to listen.
What we're looking for in equipment is innovation and improved efficiency. We're at the leading edge of food service and we expect the equipment we use to be also. With the choice of an item of kitchen equipment down to two manufacturers, it's important to build a relationship and for Compass to be absolutely certain the equipment is right for the job before a deal is agreed. We do this through pre-qualification by way of a questionnaire, so that when proper evaluation begins we're looking at a piece of equipment which at least on paper seems up to the job.
While Compass may appear to takes a tough line on kitchen equipment procurement, once we have an agreement in place, loyalty is an important factor. Contracts to supply are rolling rather than annual, and if minor design defects occur we work with the manufacturer to put them right. We expect a lot from the equipment we buy, but it is a partnership.
Mick Morgan is European purchasing manager for Compass Group