Restaurant Buying Groups - Restaurant Buying Group Comparison
It's starts as a small hiss.
Followed by a quick whoosh and before you know it.
An explosion of activity!
Everyone's caught up in it.
We're right between the hiss and whoosh part (to be technical) when it comes to Restaurant Buying Groups.
Also known as Restaurant group purchasing organizations.
More than a decade since the great Recession and restaurants have rebounded!
So is restaurant inflation!
Food prices are going up.
Pretty quickly lately.
Just when we were starting to rest a little bit, we have to think about food costs eating up our profits.
No coincidence that Restaurant Buying Groups are starting to whiirrrrr!
And now they're talking about how another recession is due??
No thank you.
Restaurant Buying groups are new to most people so let's learn about them.
More importantly (to actual restaurant owners/purchasers), let's compare the main ones out there to make an informed decision.
You can jump to any of these sections here:
Let's get started.
We need to make sure our restaurant isn't the big whooshing sound!
Let's start with the basics.
What does that really mean?
Basically, you know how you contract with all your vendors and suppliers on product and price.
And they're always telling you that's the best they can do based on volume?
Restaurant food suppliers are all about volume.
They'll use this followed by a "sorry".
As if a giant chain!
You nailed it.
Welcome to the Restaurant Buying Group.
We've written extensively on how restaurant buying groups work.
Lots to learn about but were here to compare the major buying groups.
So let's move forward!
A little bit of housekeeping first.
Yes and no.
People tend to interchange them quite a bit in the industry.
The relationships are slightly different but for our purposes, we'll use them to mean the same thing:
There are some differences in terms of membership, relationships with suppliers, and additional services available...
BUT...let's be honest...
No one's joining GPO's or Restaurant Buying Groups for market trends!
Or new Mojito (so 2010) recipes.
We're here to see if we can purchase food and supplies with some serious firepower behind us.
So to the main event.
First, the contenders.
Not all of these players have the same focus or core strengths but that's what we want to look at anyway.
Major US Restaurant Buying Groups:
There are regional players but as you'll see, the partner on the other side of the GPO is the key factor!
Foodbuy spreads it's business across health care, hospitality, and restaurant.
You can guess that healthcare is a giant segment.
And quite different in nuance from restaurants.
Avendra has a strong focus on hotels which also caters to different skill sets.
Entegra is a Southern player with hospitality and restaurant chops.
Here's more detail on the top foodservice GPO's in the US.
We'll look at all of them in detail.
That guides us quite a bit when comparing these buying groups.
We're not after hand sanitizer savings.
And if so, maybe that's why recent nightlies are down??
Now that we know which companies to compare....
What should we compare??
Let's look at that now.
We're basing our criteria on feedback from countless restaurants.
Here they are (feel free to let us know if we're missing something):
We'll add in some basic supporting information on the big ones but above is what we really want to get at.
We're here for pricing.
The other aspects need to work as well!
A quick look at the topics before we get into the comparison.
It's why we're here.
How do the restaurant buying groups stack up?
Is it worth making the jump?
The net net is this..
There's only one way to find out.
Just request a quote on an actual invoice to see what the pricing looks
On average, we're seeing between 10-30%.
You can find out more how this is even possible at our saving with restaurant buying group page.
Keep in mind that the GPO's and Buying Groups are pass through entities.
They are not (generally) supplying the food and shipping it to you.
From a supplier or slew of suppliers.
Therefore, the suppliers are really, REALLY important.
Who needs a discount if you're getting your poultry from Slackjaw Tim's Chicken Shack.
Your day to day is with the partner so that really matters.
Did we mention that it's important.
We'll put a heavy focus on this with our comparison.
So, we need a good food supplier on the other side for starters.
That alone, can address this question quite a bit.
Some of the GPO's and Buying Groups actually go a step further.
A whole range of different services really.
This only matters if the first two items (pricing and suppliers) are up to snuff.
Ease of use with ordering and tracking does go a long way to saving you time so it's in the mix when comparing.
We like the price.
We like the partner.
The ordering is online and easy.
That's all great only if the food arrives on time and as expected.
It needs to be a no-brainer.
That's a function of the partner used for with the Restaurant Buying Group.
Good news is that they all have pretty solid partners there.
Some are better than others and we'll focus on that.
The strong players have very robust logistic tracking and long reputations around delivery.
What good is a Restaurant buying group if we can only get napkins?
Not good at all.
We really want to purchase as much as possible under the contract since the pricing is so good.
This is where we see some differences between the restaurant GPO's.
Some of them contract with many different suppliers.
Other's contract with large, nationwide suppliers.
Some have contracted pricing only on certain items and those can change.
Other's offer cart blanche to everything they can supply.
We'll definitely look at this piece.
There are a few items to look at here.
It's not the dealbreaker of the decision since we can always cancel the contract but it's nice to know!
Okay...let's get to the comparison.
A few notes before begin.
Not all the information we want is readily available so we have to go based on market feedback and inference when needed.
The market is constantly changing so feel free to either call or email us with any questions.
Here's it is!!!
So...where does this leave us?
Here's the ranking of criteria that end up making the biggest difference:
Let's look at each.
All the offer strong pricing models.
Otherwise, why even go there!
That's a function of their partner and the contract.
Leverage Buying Group partners with a top 2 Nationwide Supplier.
The next runner up, Dining Alliance partners with Aramark.
LBG's contract allows you to apply the contract discount on almost any item their top 2 supplier offers.
Which is immense (to the breadth of product question below).
Some of the others work with multiple suppliers or do not focus on restaurant exactly.
That's a disadvantage.
The goal is to make purchasing cheaper and EASIER!
One of the issues we had with some GPO's is that they steer towards certain products for the contracted pricing.
This isn't how you run your restaurant.
You design your menu according to customer tastes.
Not what's discounted this week by your supplier.
We need the discount applied to every item and we need lots of items to choose from.
We also need many quality levels to choose from.
We want what we want.
The LVG Top 2 US Supplier and Aramark are leaders there.
As we mentioned earlier, once the pricing has been sorted out, most other concerns flow from the partner/supplier.
Trying to source from multiple suppliers complicates things.
The original GPO's operated that way so it was the only way we could get the discount.
That's no longer the case!
We now have the biggest food suppliers partnered with restaurant buying groups.
So...where does this leave us?
Based on our research...we have a narrow winner.
It's really a function of their partner (top 2 US food supplier), it's strength, and their contract in terms of pricing and allowed products.
You can quote a current invoice here:
We're happy to walk through any questions at email@example.com
As the market changes, we'll add new information to this calculus.
The net net is this...
We want to maximize or savings across the widest range of products with total choice and confidence in delivery.
And world peace.
Okay...we'll settle for having our food delivered before 6am.
We've made it easy.
You'll get discounted pricing quote generally in 48 hours.
If you have questions from there, let us know and we're happy to help.
Hopefully, we've shed some light on what's important when considering the buying groups.
Don't just look at pricing as they all are pretty strong there.
Those are the key questions.
We provided our best information and feedback towards this end.
Of course, if you have questions beyond, we're happy to help.
Just email us at firstname.lastname@example.org
Again, there is absolutely no cost to you for our services. Email us at email@example.com
"No... Thank you. I wish I had found group purchasing earlier. It's a no-brainer"
"We have seen a reduction of 18% for last quarter for one location. Can't wait to roll it out other sites."
"The cost savings I realized on purchasing went right back into upgrading our meat and produce quality. We basically subsidized the needed move to higher grade at no cost."
"Thank you so much! Very happy with service. If there is any way I can contact supervisors to let them know about your great service let me know"
"I'll be honest...I didn't believe the pre-rollout saving estimates. Seemed to good to be true. I'm pleasantly wrong on that"
"After test at one location, we're ready to move forward across chain. Great resource to have. "
"Wow, I can't thank you guys enough for your help...I couldn't imagine trying to tackle this on my own!"
"Thank you so much for your marvelous work. I don't want to tell any of my restaurant buddies so this stays with us"