Food-based businesses like restaurants, bakeries, grocers, and caters all run on ultra-tight margins. Working with less to make more is the name of the game. The secret to success is to find that sweet spot between cutting corners and splurging. Sometimes, you need to make difficult decisions, but before you start trying to do an entire team’s worth of work with just a handful of people, it’s important to first look at your suppliers.

Your suppliers will immediately change your business. Not only in terms of the costs you’re dealing with, your suppliers will also play a huge part in the quality of your work outright. A great supplier that offers fresh, delicious ingredients is going to help your business stand out. Sometimes, those high costs for those premium items price you out.

Some bakeries can upcharge and survive without a problem. Their customer base will typically have a higher income range, or they may be found in a popular tourist area and can survive off of those orders. However, bakeries in small, low-income communities will not be able to justify the higher prices that cover the costs of those premium ingredients.

Finding the right supplier for you is going to mean so much more than just who answered first or what business popped up in the number one slot. Sometimes, you’ll want to stick with hyper-local; other times, you’ll want the convenience, variety, and low price of going international. It can be difficult to determine where to splurge, where to save, and when to go local and abroad with suppliers. That’s where this guide comes into play:


Split Your Suppliers

The first thing you need is to split your supplier needs up. If you serve items with fresh fruits and vegetables, for example, that can be a different supplier than the person you get your meats from. You can separate your suppliers based on fresh versus dry ingredients. Very rarely will you get the best deal and also the best ingredients by shopping for all your needs in one place, so split up your suppliers by type or even whether it goes in the fridge/freezer or your dry cupboard storage.

When to Stay Local

Local produce and locally grown meats are essential when you want to offer the best possible experience. If you do this, you will likely need to price your ingredients at a higher rate. Unless you can get an excellent deal with your local farms, more often than not, frozen or imported “fresh” foods are going to cost less. If you pride yourself on offering fresh or organic foods, then you need to stick with suppliers as close to home as possible.

When to Shop Abroad

Buying food grown or produced abroad can and even should be done in certain instances. If you use a lot of spices that are typically and historically grown outside of your country, then buying bulk spices from an online, global supplier is your best bet. Not only is this how you can get the best price, but it’s also how you can get a great deal on a spice or product that may not even be found locally near you except in specialty stores.

Shopping abroad for anything will typically mean cost savings. While shopping for spices is perfect for all types of businesses, from high-end restaurants to even low-budget bakeries, buying frozen or imported fresh foods is going to be a better fit for those offering their meals at the lowest possible price points.

Pay Your Suppliers On Time, Every Time

If you want to cultivate a productive, positive relationship with your suppliers you need to not only be a customer with them for a long period, but you also need to pay them on time, every time. If there’s an issue (like your bank is holding the payment), get in touch with the supplier ASAP and let them know what’s going on and when they can expect the payment.

The longer your relationship, the higher your negotiating power will be in the future. This way, you can perhaps negotiate a price match if you find a lower-priced supplier, or can work on getting better bulk deals for your business.

Constantly Be On the Lookout

You need to go through and constantly look for new suppliers, just so you know what the market is currently like, what things are costing the general market, and what deals are available. Keep in mind that suppliers don’t always refer to your food suppliers.

Things like your accountant or even cloud-based software are also suppliers. Your utilities, phone operator, and so much more are all suppliers. Look up what their competitors are offering, and see if you can get at least a price match. Big, corporate-based businesses are more likely to match prices or offer you a deal if you plan to switch.

If the deal is better and your current supplier isn’t playing ball, then switch. The only business you need to look out for is your own. While it can be hard to let go of a long-term relationship, there are many reasons why this is the move that will help your business succeed and continue to succeed.

After all, businesses change management, suppliers, and so on all the time. If the quality is suddenly lacking, or if the price is no longer competitive, then it’s important you are serious about switching to a better business. Doing this consistently is how you will constantly get the best service or product for the best possible price.

Bonus: Keep Track of Price-Per-Plate

Keeping the prices for everything is so important. If you can, try to track the cost of each plate or item you produce versus what you sell it for. Understanding the base cost, even before employee costs come into play, is essential to help you price your products appropriately. You’ll then want to calculate the labor cost per plate or piece, and then add a profit percentage on top of it.