Top 5 supply chain management issues for restaurants

Editor's note: This exclusive column to Nation’s Restaurant News outlines what foodservice supply chain executives are facing today ahead of October’s National Restaurant Association Supply Chain Management (SCM) Study Group meeting. Written by Janet Erickson, vice chair and conference chair, NRA SCM Steering Committee, and executive vice president, supply chain management, at Del Taco LLC, the views do not necessarily reflect those of Nation’s Restaurant News.

Managing supply chain issues is more important than ever for the restaurant and foodservice industry, which will spend more than $225 billion this year on food and beverage purchases alone. Commodity prices are becoming an increasing concern, and food safety and traceability are top of mind as we seek to ensure that safe products are entering our restaurants.

Identifying priority supply chain issues and exploring key solutions to managing them is crucial for all restaurant operators. This is why the National Restaurant Association created the Supply Chain Management Executive Study Group (SCM ESG), which convened for the first time last May, and will meet again next month. Representatives from more than 145 restaurant operations and 70 foodservice brands attended the May conference, underscoring the industry’s interest in these issues.

Not only is the creation of this study group a big step in the right direction toward shining the spotlight on the importance of supply chain management issues, it also presents an opportunity for professionals in this field to network and build lasting relationships. Through this study group’s work, supply chain professionals can build connections that will serve to extend discussions throughout the year as the restaurant industry’ s operating environment evolves.

Building on the success on the inaugural conference last May, the SCM ESG will hold its Fall Summit Oct. 15-16 in Orlando, Fla., prior to Market Vision’s Fall Purchasing Conference, which will take place Oct.16-18. Market Vision is a commodities information and purchasing consulting firm serving the restaurant industry. Founded by John Barone, a contributing editor to Nation’s Restaurant News, Market Vision has worked with numerous restaurant chains. Learn more at Commodities Watch on NRN.com, or at Market Vision.

The NRA supply chain management executive study group will address best practices on the following priority issues, which are currently facing every foodservice supply chain executive:

Economic environment: While we cannot change the macroeconomic environment, making the right decisions to help position our companies to address the many challenges the slow economy brings is of critical importance. Controlling costs is a key area in which foodservice supply chain professionals can make a big difference. For example, one-third of sales in a typical restaurant goes toward food purchases, so managing those costs can have a strong impact on a company’s bottom line.

Packaging and sustainability: As supply chain executives, we can help move the industry in the right direction when it comes to environmental sustainability. We can encourage increased availability of product packaging that is not only better for the environment, but better for food quality and corporate budgets. In addition, some localities are beginning to restrict the use of certain packaging products, and we have to find alternative solutions that can bridge mandates and what’s best for our companies.

Emerging issues: Managing relationships with special interest groups throughout the supply chain is also an important part of what we do. Various stakeholders have different priorities and we have to navigate those waters carefully to balance our company’s best interests with building consumer trust in our nation’s food system.

Managing inventory: In the face of ever-increasing frequency of menu changes, we have to adapt to those changes without negatively affecting the quality of our meals or our bottom lines. Learning how to better handle LTOs, new product roll-outs and obsolete inventory, and improve internal communications will produce better results for our company.

Leadership skills: Improving the customer experience is the ultimate goal for any restaurant company, but we also need to participate as leaders in helping to make improvements within our companies. We need to better communicate our value to upper management and help them understand the value supply chain management brings to our organizations.

Registration for the Fall Supply Chain Management Conference closes Friday, Sept. 21.