For restaurants, being a member of a group purchasing organization, or GPO, means gaining access to better prices on restaurant supplies and food. But another benefit of being part of a GPO is access to rebates offered on purchases made as a group. For the uninitiated, however, rebates can be a bit of a foreign concept. Here’s what restaurants should know.
How to save money through access to products from specific brands
When participating in a GPO, members gain access to pricing they wouldn’t be able to get if they were making purchases as an individual business. Likewise, they also have access to rebates awarded by brands as incentives for working with them. In other words, an even lower price may be available to GPO members who choose one brand over another, by way of a rebate. While smaller GPOs may only offer rebates on a handful of categories, larger GPOs offer rebates on thousands of line items across hundreds of manufacturers and categories. Rebates are pre-negotiated with suppliers/vendors and the GPO, ensuring those savings for the duration of the contract. Client managers can assist operators in uncovering additional savings and rebate opportunities in the form of product switches, which can often net significant savings on easily-swappable items, such as chicken breasts, rubber gloves, can liners and more. Food cost is always a pertinent concern, but it is even more important during the current pandemic; as restaurants face unprecedented need to optimize spending and watch where every dollar goes, having access to these savings can make a big difference.
How rebates affect smaller chains versus bigger companies
Smaller chains and bigger companies alike can benefit from rebates, but for smaller chains that may not have as much capital behind them, the rebates and cost savings accrued by being part of a GPO can be more significant overall.
Denise Herrera, vice president of operations for Burton’s Grill, which has 15 locations across the East Coast, addressed that. “Since we are a growing company, we really don’t have the resources to put a full-time purchasing person on our team,” she said. As part of Consolidated Concepts GPO, though, her restaurant group was able take advantage of rebates she wasn’t able to acquire on her own. “It really was a safety net that caught all of the additional rebates.”
By being a member of a GPO, smaller companies can rely on GPOs such as Consolidated Concepts to find the best prices for them rather than having to hire a full-time purchasing staffer—and that can make a huge difference in savings over time, too.
Monitoring contracts and rebates—with help
When choosing vendors to purchase from, GPO members should be mindful of the companies they are working with and monitor closely whether there are rebates to be had. More important, though, members of a GPO should feel confident that their GPO is working hard to find the best deals. Consolidated Concepts helps do just that. James Clark, director of food and beverage for Murphy Adams Restaurant Group, which manages more than 36 locations of two different concepts, said, “I really count on Consolidated Concepts to pick up all those pieces that fall through the cracks. I don’t have time to chase down contracts or rebates for every single SKU that we are going after. Consolidated Concepts does a great job of finding better pricing and rebates.”
Rebates are just one benefit of being part of a GPO. To learn more about how Consolidated Concepts can help with food cost savings, supply chain reliability and more, visit consolidatedconcepts.net.
I might change the wording here away from ‘limiting’ or add some information about the vast product coverage of a large GPO partner:
While smaller GPOs may only offer rebates on a handful of categories, large GPOs like Buyers Edge Platform offer rebates on 165,000 line items across hundreds of manufacturers and categories. Client Managers assist operators in uncovering additional savings and rebate opportunities in the form of recommended product switches, which can often net significant savings on easily-swappable items like chicken breasts, gloves, can liners, etc.
This post is sponsored by Consolidated Concepts