Name: Procurement In The Hospitality & Entertainment Industry (1080p)
Uploaded: 2025-12-04T08:34:20.211Z
Duration: 34 min 26 s
Description: Procurement In The Hospitality & Entertainment Industry (1080p)

Transcript for "Procurement In The Hospitality & Entertainment Industry (1080p)": Hello, everyone, and welcome to our webinar in partnership with Amazon Business. My name is Libby Hargreaves, and I'm the editor of supply chain digital. Today's webinar is part of an ongoing series with Amazon Business, where we explore the big issues keeping procurement leaders and supply chain managers up at night. Make sure you visit the webinar section on the procurement magazine website for more insight expertise and success stories. I'd also just like to mention our procurement and supply chain live event series, which promises to be bigger and better than ever. Today's session is on procurement in the hospitality and entertainment industry. In this webinar we'll explore how modern hospitality and entertainment venues navigate the balance between guest facing demands and the realities of back of house operations. We'll look at the supplier networks needed to support such varied environments and uncover strategies that maintain quality, consistency, and creativity, while still keeping cost control and compliance at the forefront. We'll also discuss how organizations can build stronger transparency across multiple venues, gaining the visibility required to make smarter decisions, streamline fulfillment, and respond more effective to changing usage patterns. We've got a couple of brilliant experts joining us today to unpack these themes and share their real world experiences. I'm joined by Meera Cohonan Law, group head of procurement at Fournam, and Uzair Chowdhury, vice president of procurement and supply chain at Canada Aramark. Meera, Uzair, thank you so much for being here. Before we jump into this the discussion, perhaps each of you could start by giving a short introduction. Mira, let's start with you. Please tell us a little bit about your current role. Thank you, Libby, and it's a pleasure to be here. Hi, everyone. My name is Mira Korfonen Lowe, and I'm the group head of procurement for the Foranom Group. I look after all of our procurement and purchasing activities across five countries. So Forum Group is the largest long stay hospitality b two p, operators in The Nordics and Central Europe. Alizair? Thanks, Libby. Great to be here. I'm Alizair Chaudhry, vice president procurement supply chain at Vender International on Aramark. I lead our contracting and sourcing teams across all of our hospitality, entertainment, sports and leisure, healthcare and multi site operations. We support stadiums, casinos, theme parks, convention centers, hotels, restaurants, spas and other guest facing environments like universities, colleges. My role focuses on helping operators manage food and beverage services, OS and E and FF and E as well, in a way that actually improves guest experience, while, controlling costs and assuring supply. Fantastic. Now onto the nitty gritty. In your experience, Mira, how do hospitality and and entertainment led venues adapt OS and E procurement to support both guest facing spaces and back of house operational needs? Well, I would say for us, it really comes down to scoping. So for us, when we have, I don't know how much the, audience would know who we are, but one of our unique points is that we are actually, staffless in terms of we don't have funds of house staff meeting the customer in our in our venues. So for us, it's actually very important to make sure that all of the services and supplies and equipment that we procure, we're able to provide those services in a way where we don't need daily staff to deal with our suppliers. So for us, in terms of how do we scope from, front of house spaces to back of house operational needs, we just really need to make sure that we scope all of our materials, and products well enough so that we know that our front of house products are designed for the particular environment. And then also, of course, back of house, equipment and services and and goods are, tailored for the needs of the staff. This is maybe, obvious, but for, of course, for us, front of house, surfaces, for example, we purchase a lot of, cleaning equipment. We have services to maintain those spaces, That kind of equipment and, what we have in the front of house has to be different to what we have in the back of house because, of course, you have, deterioration of surfaces if you use the wrong type of of materials on front of house. So as a hospitality operator, we have to be mindful of all of that kind of thing. And maybe you, sir? Yeah. Well, Libby, you know, I think in hospitality entertainment led environments, really as Meera pointed out, there are two distinct needs, right? There's the back of house requirements, which really where you want to drive efficiency and cost down. And, and then the front of house where you wanna make sure that you're tackling some of that experience. So one of the best practices that we've seen in, in our spaces is, having about 70 to 80% of OS and E items standardized for the back of house. So a lot of standardization and then allowing for that 20% to 30% of flexibility for front of house. And then the other item, as Mira mentioned in her location, they don't have labor, but one of the key aspects in our space is also is procuring items in the West and East space, which actually deliver a lot of labor optimization, right. So ready to use items, easy to use. Staff changes quite considerably these days, that's one of the challenges. So how do we buy and source products that help our operations and our labor rather than potentially hinder them? So, but at the same time, allowing for that flexibility for guest experience. The other piece that's really, important in in this space is really consumption spikes. Right? So you you may see significant consumption spikes that are out of your control and planning for that is really important. So tying tying your Osmi, sourcing to your actual calendar is is also particularly important. And, speaking of the source sourcing spikes, what unique pressures, for example, demand variability, peak event periods, shape procurement decisions in entertainment and accommodation settings? So I I think that, we, you know, in some of our spaces, we have extreme demand of of volatility. Right? So stadiums, playoff runs, you may have a game, you may not have a game. So you're looking at maybe potentially between 20 to 60,000 guests coming or not coming within a week, right, within the span of a couple of days. So two to three times the OSNE burn during those events is really something that we have to plan for. So those real peaks and spikes, you need to have strong advanced planning. So you have to have, both, long term plans as well as backup supply. The unique pressure around multi experience venues as well is really, really important. So in a location, you may have a in a hotel, a spa, retail outlet, food and beverage, restaurant on-site. So planning for all of those different variables is is extremely, important. It creates a lot of catalog complexity that has to be planned for. So, again, it's it's really important that, you stay in tune with operations, but you have a sort of a centralized view for a centralized catalog, And you appreciate the fact that you it it can be complex, and drive different OS and E profiles per zone. I think that yeah. Great points. I'm just listening going. Like, we have we have very similar challenges, I think, in terms of working in the hospitality. For us, it's really, we have we have things like low season and high season. For us, really, always, any planning has to do with the fact that we we procure a whole amount. So we procure a lot of, goods for customer use in terms of using the actual hospitality venues themselves. So we have to make sure that we have good planning. So we have demand planning for for the year ahead. But, of course, like, Uzair said, it's very difficult to have, a good idea of where your capacity is going in a year. So we work off things like ADR and RevPar. So we have certain things that we, you know, daily rate. So we look at things also from a how much do we need to procure to make sure that we have healthy EBITDA levels and, you know, that we're we're not buying excess stock in the long c in the long season, for example. So in the low season, we want to make sure that we freely, optimized our purchasing trends so we're not we're not holding too much stock because, of course, we purchase perishables as well. So then, trying to make sure that we don't have write offs of stock. We have the right amount of stock at the time when we need it to prepare for high season. They're really the sort of for for our business, in five countries where also we operate. We have to make sure that we have good standardized services and also, good, like Yuzera said, standardization is really key as well for our business. Of course. Thank you both. Moving on to talk a little bit about supplier networks now. Meera, what sourcing strategies would you say help ensure a consistent quality and performance when suppliers must serve a high traffic and determined area, including hospitality spaces and those special specialized operational zones as well? For us, we really, we have to live with data. So we live with data with our suppliers. We give them planning data for planning so they then they can prepare for like I said, we have low season and high season. We really have high peak demand, windows where we have to make sure that we do have the capacity with the supplier to be able to service the amount of rooms, for example, that we are about to to to, put into to to sales, and we have customers coming in. So it's really it's really managing, their time, their staff, their resources, and the quality. So what we find is if we don't do the capacity planning well with them, our demand planning, in terms of what they need, then we come into quality issues because of lack of staff. And I'm not sure if this is the same in in Uzair's world, but we really find that this is where we then need to have these contingencies plans of how we make sure that, in in high demand peaks, we're able to spread some of that load to our suppliers so quality stays good. And is there do you have any sourcing strategies to share? Yeah. So let me you know, one of the things we found that the most effective sourcing model that we put in place, whether it's in the hotel space or in stadiums or convention centers or even casinos, is is really a tiered, supplier ecosystem. So what we drive is, national or, global suppliers that provide, the backbone standardization, high volume, my OSNE items with consistent pricing and reliable fulfillment. And then we find that regional suppliers, they handle geography specific or freight sensitive categories. And then we we sort of layer the last bit in, the icing the proverbial icing on the cake is local suppliers that support experiential needs. So spa products may be, sourced locally, themed attraction material, or specialized restaurant items. This structure we found really at the end of the day helps us, both reduce defects and out of stocks, but still gives operators a little bit of what we think they need is just creative creative space, to differentiate themselves. It also mitigates a single source dependency, and builds agility for events spikes. Because often you'll find there is a little bit of tail that the regional supplier has or the local supplier has that you can leverage in those moments where you may not be getting it from your global supplier. And so in in my opinion, I think the most sophisticated operators increasingly value suppliers not just on price, but on their ability to scale up quickly, manage replenishment speed, and then also, maintain quality across multiple venue types. Thank you. And how can procurement teams balance standardization with flexibility with the flexibility required for unique entertainment experiences, themes, or venue formats? Meera? Well, I think what's worked really well for us is that we've standardized our key supplies. So we have things like furniture and fittings and locking systems. We have to we have to have really think about the categories where we need to have very strict standardization because we we need to build integrations and automations into our systems. So we have a proprietary ERP, which we've built ourselves. So, of course, we need to make sure that the supplier can be adaptable to our system and they can operate with our system. So that's the one thing, where we we have identified where we need to standardize, and then we we are more flexible in the categories where we feel like, there is you know, there's no need to have that sort of really strict, standard. And then for pricing flexibility, this is really important as for us as well, because we we are a very high volume purchaser for we have a lot of procurement in, the feed fittings in the pictures space. So we buy a lot of furniture, for example. For us, we we find what works really well is that we we look into having locked, pricing periods, where we guarantee we get the lowest possible price. And then we have an annual review review process, each year, and also we have caps on increases. And this is really a way where we get to make sure that we have the the benefit of having, good central contracts, good control. We have, known price points for the year, so we can do forecasting on our costs, but also that we are protected against really high volatile changes in raw materials, for example, that go into some of the fittings procurement that we have. Like, for example, we had the Ukraine war and COVID, which really, caused major havoc in in our supply chain. So that works well for us in terms of of our strategy. Some great points there. Is that do you agree? Absolutely. I do I I agree. I actually think, you know, Mira, her point is really important. We shouldn't blaze over it. The right balance starts with identifying which categories or items actually truly drive guest experience. Right? So linens, amenities, tableware, smallware, springware. So once you understand that, versus which categories, are less direct impact on guest experience, you then have to factor that into your planning cycle. You source for standardization and protecting cost, hygiene and replacement efficiency on those standardized items. But but that flexibility is really important around the other space. So but the first step as Meir pointed this, is knowing. And we find the challenges that even between different in the same sort of operator in multi sites, their appreciation for which items are directly impact guest experience, which ones don't is very. So understanding which ones in your space will impact your guest experience is really important. So getting that guest feedback, if you don't have that guest feedback, it's tough for you to be able to implement it. Then you have to have open lines of communication with your sourcing team to be able to source for those avenues as well. And then and then implementing that into your catalog so that both operators feel like they they their their voices are heard, but they are actually able to achieve some of those guest experiences. And I think the big insight for us, across, like, these multisite hospitality locations is is guest preferences. You know, as hard of a pill as this is to swallow, it's guest preferences, are actually, patents replicate themselves. So if something delights a guest in one location, it often, performs well across other locations and other venues. And capturing those patterns makes for better, smarter sourcing decisions year over year. So in the importance of, you know, data, as Meera mentioned earlier, is that data funneling back to sourcing is extremely important before the sourcing cycle starts, not after. Mhmm. Thank you, Bert. Now when it comes to transparency across multi venue operations, there must be a few challenges to say the least. So how can and determine organizations gain better visibility into spend, inventory, fulfillment, all across locations that ultimately have very different usage patterns and operational rhythms? Meera? It's a really it's a it's a short question that is is, it could be a very long answer. But I think for us, for example, operating across five companies, I think anyone who has a sourcing organization that's responsible for a multinational, multi country environment, you know, if if you have great systems, it's fantastic. For us, for example, we've had to develop our own ERP, and, the way we get visibility is that we use, information that comes in from our own ERP. So we've even developed modules where we can track some of our service, partners in there. So we have, we have good data, and it doesn't need to be your own system. So, you know, it could be a system somewhere where you have visibility on on what type of service, levels service capability, what what is happening on on-site in terms of of your, in your locations. We have you know, it's almost 8,000 locations that we track through the ERP. And then also, we have ensured, for example, things like inventory. You need to have a really good control of your inventory. If you don't have if you have internal inventory practices, it's always recommended to make sure that you have good, resourcing for that. If not, then you outsource it. We have outsourced all of our inventory management, and we really get good data. We insist on good data from from that supplier. So we have we have, the ability to see what is inventory, what's the level of fulfillment. We get to do planning also for the future to see what's what's in stock, what's not, and, also movement of assets. For us, it's really this is an asset heavy, business for us. So for us, it's really important to be able to see, the movement of those assets and where they are. But, yeah, I would really say, in short, it's a mix of your own data and your suppliers' data, and you really need to combine it well and work with it. Thank you, Mehra. Is there? Yeah. Yeah. Yeah. Absolutely. So it's it obviously starts with, aggregating, collecting data, but visibility, improves dramatically, in my opinion, when procurement is consolidated into a unified digital environment. So when you have centralized purchasing, you can aggregate some scale and scope, those curative catalogs having them digitized and available. And then, you know, one aspect that I think that, you know, when you play on what Meera is saying in terms of you you have to have a system. Right? Whether it's your own, whether you buy somebody else's, you have to have an integrated system. And once you have those integrated systems, you know, your question around transparencies, when across multisite operators really typically, you can uncover a lot of hidden, spend that's, that you you don't see necessarily. So once you have that integrated, system, you can start to track things. And specifically, what it becomes important is the you know, on the concept of sharing data transparency is starting to operate your metrics at a certain level where it's a per guest or per event or per occupied room basis. When when you start doing it in that format and then you, in a multisite operation, you start to compare, you see that behaviors change instantly because operators can actually see cost drivers versus, you know, rationalizing it for demand. So you when you layer that out, it's a little easier to be able to, you you know, understand demand patterns. And forecasting becomes more accurate, especially around peak periods. And so, you know, in my opinion, again, this benchmarking across venues, reveals patterns that, were, you know, invisible, before and enables more strategic planning. So really harmonizing your data, collecting it. Whether you're using, your own system or using another system, I think you really need to spend a lot of time understanding your organization and building that data and insight availability to move operators and source. Some really important points there. And, Meera, are there any tools or processes that help ensure compliance and consistency while still enabling creative and experience driven procurement decisions? Well, I think like Uzair said, if you have a procurement tool, if you have some sort of vendor management tools or a way to funnel all of your, activity into a place where you can have visibility, then that's that's really a good starting place because then procurement can, influence some of those, some of those purchasing methods. You can influence some of the behavior. But another really important aspect is that if there is sort of sourcing activity or implementation, anything that has to do with multi venue, multi country, the implementation of those new services, or contracts has to be professionally done by procurement. The handovers need to be clear. You need to have a really good understanding between you and the business. So when you when you transfer it to business as usual, on what what now is responsibility between yourselves and and the business and the operator. Also, we find that, so I you know, our job is to make sure that we have, good catalogs, good products, good ordering processes, and we deal with implementation, so that then the business can look after the customer facing part. And, you know, we leave that to them. I yeah. That's really where I think, we can add value. Thank you. Is there anything to add? Well, I would just say, you know, in in my opinion, it's it's interesting concept compliance. Compliance, in my opinion, actually improves when procurement, removes some of the friction rather than adds it. And what I mean by that is, you know, having those curated catalogs, but having them with simple approval workflow, right, for requesting alternate items. And and and clear compliance dashboards, we found in a lot of our spaces when we when we transition, clients or our own operators, from looking at compliance to a more regular basis. So whether it's weekly or monthly, for them to be actually looking at their compliance against some of our contracts and what they're purchasing is really important. And it makes it easy for operators to stay within guidelines. Right? Operators still have operators still have the the freedom to choose, but within approval structures that still protect cost and quality and brand standards and safety across all of venues. So it's it's it's really what we what we we term internally is, like, governance by design, right, not governance by restriction. And, this balance creates a system where operators feel supported, not constrained, and where cost control and experience experience quality improve at the same time. It's it's it's a it's a novel notion, but it actually ends up happening. So, it really is allowing the operators to feel like they're part of the process by giving them that simplified approval workflow, but really having a very strict system that controls your catalog at the same time. It's that balance. Can I also add just this one small thing? I love the comments there. But another thing that I forgot to mention that is really has been valuable for us is involving the commercial, part of the business as well. So if you have any any product or service delivery that actually forms part of how your brand is perceived by the customer, also, procurement can, again, get great buy in if you involve those kind of commercial and brand discussions in in terms you can convert that to we are buying this because of, we are procuring this because of, this really broadcast how our brand is perceived to the customer. And it's important that we are cohesive and our brand is seen as being cohesive. So that was just one additional point where I felt like it really helps with the buying. Fantastic. Well, thank you both for your insights so far. I can see we've got some pre submitted questions from the audience. This is a good one. One viewer asks, as a small business owner, I don't have the same scale or resources as large hospitality or entertainment venues. What are the top procurement practices you would recommend that can help a smaller operation handle sudden spikes in demand or unexpected supply issues without overspending? Great question. Meera? Well, as a small supplier, I would say a good advice is to make sure that you have well, you should at least make sure that you have procurement price controls in your, agreements with your suppliers. A good thing is always to make sure especially if you're worried about, spikes in demand or supply issues, this is where your party controls, your CPI, increase caps are very important to make sure that you have those in your contracts. And also, of course, if if there is a possibility linked to indexes when it comes to this, this will protect you in terms of if there's inflammatory pressures related to some of the goods that you're purchasing. Another tip would be to make sure that you diversify. So, you know, to make sure that you have primary and secondary suppliers, you don't need to have you know, it's it's maybe an eighty twenty split, but this also means that if there is increased demand, that you can push some of that overflow to your secondary supplier and still able to meet the demand of your business. And, also, of course, then you might have access to broader pricing. Not all suppliers are really good at protecting their own, raw material, pricing. So then if you have more, suppliers in your base, which you have negotiated good contracts with when you when there are spikes like this and and inventory pressures and, demand, then you might have access to better pricing if if you have good suppliers that have actually prethought this. And is there any advice for our audience member? Yeah. You know, yes. You know, for small operators, often they wear a lot of different hats. Right? And, so I think I think the first and foremost thing is to sort of identify, where you wanna focus. Right? So when you when you're when you're extremely busy in a smaller organization, it's really important to identify like that that top 20% of where you think you can get the best value. And and, you know, in my opinion, it might be a biased opinion, but the biggest, advantage for small, operators or the biggest opportunity for small operators is actually partnering with an organization, that might be able to help you support you with your procurement and sourcing. Right? So a vendor international, we offer our services to clients that operate their own facilities. It actually lets small and midsize operators punch way above their weight class. They they get access to vetted supplier networks. They mitigate risk in terms in terms of sourcing. They get negotiated pricing like Mira mentioned earlier. And we we we have full flow and assurances and procurement governance that's already in place. So, you know, I would argue why why not try and punch above your weight class by just partnering with someone else that might be able to support that, that space. And I we see it working wonders in terms of we've seen savings between, you know, on on OS and E items, commodity items, sometimes even between 15 to 20% savings for clients that participate in those programs. Some great points there. And finally, someone else asks, what major changes do you expect to shape procurement in entertainment and hospitality as we move into 2026? Meera? In this one, I'm gonna have to say that the area where we're operating, so the European Union, is really bringing in a lot of sustainability requirements. So we have the CSRD, reporting that's coming in and also a lot of, yeah, a lot of sustainability initiatives that probably will be front of mind next year. A lot of those impacts will be, really hitting the industry, and we have to then make sure that we spend more time classifying our suppliers and our purchases to ensure that we are being sustainable. Everything's becoming way more transparent, so there's no more, greenwashing. It is it is going to be a a key focus for us, and I think will be a a key focus for the industry as well. If you can't play in that space, you will you will probably not, succeed very well. And, in terms of, the the growth that's in this industry, look, I think the ADR and the RevPAR is really, going to be moderate growth next year. For us, it's really just making sure that we can capitalize any of that growth to make sure that we're considered to be a good sustainable, reliable partner for hospitality. And, of course, what we're also seeing is, some of this c to b space. So the sort of, consumer space is growing, as well. So we're more of a b to b operator, but the, the consumer space is growing especially in that land. So, that's that's probably a a growth area for us too and any any operator to think about. But, yeah, cross pressures will continue and, sustainability issues will continue. Over to you, Esa? Well, Libby, I think I think, Mira absolutely hit it on the head. You know, sustainability definitely is gonna be one of our focuses, and I think the industry focus, in '26. But as we move into '26, I think there are some other areas that there's gonna be some shifts in major shifts. One is, moving towards more unit economics. So understanding costs and consumptions per guest, per event, and per occupied. Like, I I talked about that a little bit earlier. Operators who really master this are gonna make smarter decisions and tighter cost control. So moving down to that granular level. And and that sort of actually plays into what I think one of the big shifts is gonna be as the incorporation of AI driven forecasting or artificial intelligence into the sourcing process. Right? And then it's it's gonna be more proliferated across different organizations. So that's gonna enable us to do some of that unit based economics that I talked about earlier. Sustainability measures and pressures that, you know, greener amenities, circular materials, concentrated cleaning systems, reduced waste and oilseeding, all that is, you know, it's not going away. It's exactly only gonna just be on steroids in 2026. And then I think one one area that we see as, when we look out into the future is is a supplier consolidation. Right? So we are seeing more and more suppliers consolidate acquisitions happening in particular in the OS and E space. So fewer suppliers with, will sort of challenge this space as suppliers trying to consolidate your SKU availability, your variability might go down. But I'd also think you'll come with deeper accountability for service and quality and resilience from those suppliers. So really navigating that as there is supplier consolidation in in the space is gonna be really important for operators. Fantastic. Thank you both. Well, I'm afraid that's all we have time for today. My thanks to all of you for watching. And Meera, Uzair, you've both been great. We'll speak again soon. No doubt. The recording of the webinar will be available shortly, so you can come back and watch it all over again. You can also catch more webinars over on the procurement magazine website. Just head to the procurementmagazine.com. Thanks again to you all for watching bye for now.