Finding the Right Equipment Supplier Paramount to Success in the Restaurant Industry

If you plan on opening a restaurant, choosing the right equipment supplier should be your top priority. Why? Identifying the right supplier can help improve profitability and efficiency in the day-to-day operations of your eatery. You will not only find that it is possible to provide great customer service, but also foster growth and expansion as your business grows.

In this article, we'll discuss some of the crucial steps in this process and explore how you can overcome any challenges you may face in finding a reputable supplier for your restaurant's needs. Plus, we'll go into detail on five types of suppliers that should be considered when making purchases while running a small or large sized business alike.

Thinking about starting your own business? Start with this article to learn how to properly choose the right suppliers for your restaurant, and how to improve on your financials in the name of success.

What Suppliers Look for When Evaluating a Restaurant for their Needs

Suppliers have many different criteria when evaluating potential tenants or buying into a particular eatery. Some of these criteria may include: financially sound, strong bonds with restaurants in the locality, access to capital, a dedicated and knowledgeable manager, clean facility, etc.

Prior to entering into a contract with a restaurant operator, it's important to evaluate any of your existing suppliers. This is because it is imperative to maintain several levels of product availability. The alternative is to have critical restaurant supplies on backorder and not be able to provide your customers with the services and products they desire.

What About Food Costs?

Food costs can be one of the most important factors in evaluating a potential business deal or identifying a great equipment supplier. This is because food is the first cost that must be accounted for in a business-to-business sales transaction. This is true even if the purchaser or supplier needs to pay a premium price, making a sale worthwhile.

Therefore, food costs are likely to be one of the top considerations that you'll need in your selection process. For instance, if you're looking to sell equipment, it would all come down to how much food costs in your operations. The better your food costs, the more advantageous it will be for customers to choose your business over another eatery that does not offer great deals on all the above-mentioned factors.

Having a good profit margin can mean the difference between opening a successful business, and a restaurant that is finding it difficult to break even in its first few years.

The Most Important Elements in the Restaurant Equipment Supplier Selection Process

There are several steps to consider when making business decisions for your eatery. In order to narrow down on the appropriate equipment supplier, you might want to focus on food costs, financial stability and location. These criteria may look different depending on your ultimate goal. For instance, if you're looking to open a fast food restaurant where high volume sales will outweigh all other expenses, then you'll have different needs than another new parent-controlled restaurant that does not feature high volume sales as their primary goal.

Below are some of the most important elements to consider as you prepare to make purchases for your restaurant's needs:

Food Costs  – The higher your food costs, the more pertinent it will be for customers to choose your business over another eatery. In other words, you'll have more control over your cost structure if you're a high volume restaurant that does not feature low food costs compared to another eatery that does feature low food costs. In this scenario, the customer is less likely to sift through multiple options and go with the lowest cost option.

Location – There are many different factors that come into play when deciding on where to open or purchase from in terms of equipment and supplies. Location is often one of the top considerations when planning on expanding a family-run restaurant. For instance, if you plan on building a new eatery in an area that has a large network of restaurants, you might consider looking to lease from a supplier that is located near other operations so that your business will run more smoothly.

Financial Stability – Another important aspect to take into consideration is that suppliers would like to see financial stability in your business operation before entering into any type of agreement. This goes hand-in-hand with ensuring that your business runs somewhat smoothly and that there are no major challenges in store for potential customers.

Thick with Tradition - As you consolidate your contacts, it will be essential to build a relationship with suppliers that deal in equipment. This is important because you'll want to make sure that the supplier you work with has strong sales and customer service capabilities.

These are just a few of the many considerations that any business owner will need to take into account when selecting a supplier for their needs. Providing your customers with great food, having a stable financial structure and building relationships can be achieved if the right people are involved during negotiations.

5 Types of Suppliers to Consider

1. Independent Distributors

These are the most common type of business-to-business suppliers that you'll find in the food industry. The independent distributor is usually an individual or company that sells and rents equipment on a wholesale basis with a selection of other goods such as cutlery, crockery, uniforms, etc. That's right; these distributors will typically have complete control over their inventory and do not deal with restaurants or entrepreneurs at all.

2. Manufacturers - These businesses will often make all of the products they sell in-house and may own their own production facilities. The only difference between independent distributors and manufacturers is that the latter will usually own their own products.

3. Engineering - Engineering businesses often focus on researching, improving and developing new equipment for the food industry. These types of businesses are great because they work with other engineering companies to create new innovative products that are beneficial to their customers. For example, you'll find small engineering companies that design and manufacture unique venting systems that take into account customer needs such as convenient access to the kitchen area.

4. Leasing - This type of equipment solution is ideal for growing businesses that need short-term capital and long-term payment installments.

Conclusion

When you're looking for a supplier for your business, it's important to be thorough in your selection process. You'll find that there are many different factors to take into account as you prepare to make your decision. If the items above do not stand out or they appear unattractive to you, then you may want to reconsider the option in question.

Similarly, there are many different types of suppliers that will work best for specific scenarios. Some equipment suppliers may offer rental agreements while others may lease full products such as ovens, steam tables or cooking equipment such as broilers and convection ovens.