To Buy or say ‘Bye'?

Purchase department in any organization is important as, being the centre of successful supply chain management; it helps in improving your business. The top objectives of the department in the hotels, as in any other business are selecting a mix of suppliers who can provide the best prices and terms, reduce risk and ensure the security of supply, improve quality, pursue innovation, etc. The purchase department in the hotel industry has to deal with a wide spectrum of activities to ensure that the organization attains – and maintains – profitability. Ashok Malkani tries to evaluate the on how it deals with various objectives and the problems that it faces.

- Ashok Malkani

Procurement process in a hotel is a complex function. The procurement or purchase department of a hotel plays a significant role in seamlessly running a successful and profitable business. A purchase manager has the responsibility of discovering sources for materials, contract negotiations, and payment terms. In hotel industry the purchase managers are intrinsically connected to the success of the business at nearly every level. In hospitality, procurement occupies a place of singular importance as it helps in not only supplying the organization efficiently but also producing value through optimal quality of goods. In this new digital age traditional hotels have to compete aggressively with new style accommodation, like AirBnB and similar services, fighting to cut costs without sacrificing quality or user experience.

Padmakumar K, Purchase Manager, The Leela Palace, Chennai, declares, “In any industry including Hospitality, procurement process is pivotal. In Hotel industry optimum procurement is the key for effective and desired output with minimal investment which certainly has its impact on company’s earnings. Procurement process has become more relevant today as there are multiple options available and careful evaluation has to be done to ensure that you get the best product at competitive price.

Bernad Fernandes, Procurement Manager, Sofitel Mumbai BKC too is of a similar view. He adds, “The purchase department acts as the mediator between the hotel and its vendors. Therefore, it is important for the department to coordinate efficiently between the two so that we can optimally use our resources keeping in mind our budgets and aim for maximum profitability of the organization. At the same time, we avoid any compromise on quality because we, at Sofitel Mumbai BKC, believe that quality is non-negotiable.