BHM 407

HOSPITALITY procurement,
purchasing & selection

BY :

Name : Celyne Taneda

Student ID : 17.53.01.0020

Class : HM IX-13

Intake : 2017

Major : Hospitality Management

Submission Date :
Question 1

What are example of some of the most important responsibilities of a Director of Purchasing?
How do these responsibilities impact the success of the organization?

Answer : I think the most important responsibilities of a Director of Purchasing are

1. Track place orders & inventory

It is up to the director to determine what types of materials & supplies & place orders as
needed. It will involve keeping an inventory of materials & supplies on hand & replenishing
these items as they are used.
2. Establish cost budgets
Director must create a a budget for spending on materials & supplies, it would include
materials & supplies pricing as well as staffing & transportation of goods. Director must
work closely with other managers, to complete inventory planning & forecasting reports that
will impact the budget.
3. Select & negotiate with vendors
Director build relationship with vendors in order to receive competitive pricing & quality
products, they will negotiate pricing & contracts & continue the business.

Question 2

You’ve learned that transportation costs are one of the expenses “built-in” to products that are
purchased. When, if at all, would you ask a supplier to provide a product price excluding
transportation to reduce your costs? In other words, when would you consider allowing someone
from your organization to pick up the products at the supplier’s pl ace of business? Defend your
anwer.

Answer : if this can reduce the costs, I will ask supplier to excluding the transportation prices. If
the supplier is in the same city as my place, I will arrange the appropriate time and ask the
delivery party for documents or items at our place to pick up the items, but if the supplier’s
place is outside of the city, maybe I will ask supplier to find the cheapest transportation prices to
reduce the cost.

Question 3

Procurement is an extensive, strategic process to acquire products necessary to run the business.
Why do you think it is imperative to have this process? What are some potential pitfalls for a
hotel operator that does not understand the procurement process and its value?

Answer : It is imperative to have this process because it can simplify and expedite the process of
strategic planning, procurement of tenders, vendor selection and recording company’s assets, can
ensure the procurement process of goods, running on time, the amount in accordance with the
order and also check the quality of the good themselves, able to assess and choose potential
providers of goods and services based on certain criteria, this activity is called the supplier
qualification process that aims to get providers of goods and services in accordance with the
standard, conducting the right strategy to achieve the company’s goals and also in accordance
with the company’s business plan, this strategy concept must be owned by procurement
department, supervise the quality of providers of goods and services, such as scoring,
certification and penalties, it aims development of providers of goods and services, procurement
process can make goods and services providers as part of the company’s business growth, the
higher level of company acceptance is directly proportional to the ability of providers of goods
and services that support it, preparing cooperation between the procurement department and the
suppliers of goods and services, so that is not only related to supply activities, but the success of
the procurement division can be judged by the percentage of vendors who are loyal and provide
the best service for the company. From explanation above, it appears that the purpose of
procurement for company is not only supply of goods and services but there are other activities
that will continue to support the company’s operations, that’s it is imperative to have this
process. For the pitfalls for a hotel operator that does not understand, maybe the item or service
order details are not better tracked and confirmed, delivery of goods is not certain to be safe or
not to the destination

Question 4

1. What are some challenges you think hotel companies faced in 2000 with such a large
initiave?
2. The article to direct links to vendor websites and access to full vendor categories, what
potential procurement issues might arise from this?
3. What do you think drives cost savings from an effectively functioning e-procurement
system?

Answer :

1. The challenges is the opportunity for the hotel to get a vendor may take a long time, but
the hotel can also find out whether the vendor can be trusted or not because they meet in
person. The registration process is still manual and complicated as starting from the
place, table, chair, fill out the form and also prospective vendors who must prepare a
letter in accordance with the requirements to be submitted, so the parties concerned must
be far more thorough and focused. Explanation meetings are held face-to-face, so the
party explaining must learn and know the ins and outs of the explanation he gave in order
to answer the questions from the vendors, so the party that explains it will better
understand and so may be able to find out the shortcomings of procurement and can
submit opinions so that procurement can develop.
2. Because it is related to the website, maybe the problem that arises more often is technical
problems, such as changing IP blocks at ISPs, every year the procurement process must
go through a tender stage, so that every year there is a possibility of a change in the
 winning bidder resulting in changes in the IP block in accordance with the IP block at the
tender winner's ISP because of that change, it takes 1 x 24 hours for the Resolve DNS
process, which will result in the downtime of all web-based services including the e-Proc
system. WAN connection problem, for example: North Sumatra Provincial WAN
Connection uses 802.11 b / g wireless LAN, along with the increasing use of this
technology, resulting in slow and disconnection of the North Sumatra Provincial ,
Government's WAN / Agency connection due to frequency interference. For non
technical problems, the amount of natural resources and leadership, As a result of the
absence of a legal umbrella in the implementation of e-proc, reluctance arises from
decision makers at the operational level to take the initiative to start changing the
procurement / tender pattern into the form of an electronic auction.
3. E-procurement can save costs because it avoids us from : duplication of the purchase of
goods, the amount of uncontrolled expenditure, and minimize costs incurred for the
manufacture and maintenance of fission documents

Question 5

A. Why do you think the hotel’s contracted suppliers were unable to provide the monkfish?
B. What are some products requirements that the hotel needs to establish before the event?
C. Are there any challenges that the hotel may face using a supplier they are not familiar
with?
D. How can the oursourced procurement company assist?

Answer :

A. Because one supplier alone cannot supply the monkfish according to the quantity that is
in the requirements, so it needs more supplier to provide the monkfish
B. Some products requirements are the product presented must be clean and sterile, the
product is supplied according to the agreed terms, the product has a payment term (credit
terms), the price offered adjusts the market price, suppliers of food ingredients or
products must have a business license, the supplier can maintain commitments that
include communication and delivery times, has a clear identity for the origin of the
product, has a clear level of quality or grade, has a clear quantity of measure, for example
Lb (pounds), kg, Ltr, Pack, Gr.
C. Because the hotel does not yet know the suppliers the challenges that must be faced by
the hotel that is to have to investigate deeper like must know the quality of their products
because if the quality of their ingredients is poor, then it will also affect the quality of the
products produced or presented, after ensuring the quality of products from suppliers,
hotels must ensure their ability to produce in accordance with the desired amount, hotels
also have to predict from the beginning the ability of suppliers to provide materials so it
needs to take into account the factors that may be constraints, such as distance, equipment
used, their work schedule, to the number of workers.
 D. Can help the hotel if during the event the hotel is short of employees, therefore, hotels no
longer need to take care of recruitment, training, and others because this has been
managed by an outsourcing company, reduce the burden of limitations for hotel
development.

Question 6

When constructing the final points of a procurement deal, should the buyer try to negotiate a
contract for multiple years or for a single year? Discuss the Pros and Cons of a longer term
contract.

Answer : Depending on whether the buyer already believes and matches them. The pros are a
long-term contract can to take the financial guesswork out of hotel’s cash flow, and they
offer a great opportunity to grow a meaningful relationship with client, can truly master the
strategies behind client’s campaign it need some time to get to know the ins and outs of
clients, this also gives time to figure out how many resources should invest in the project to
make it work, if we have a long-term contract in place, we can dedicate more of resources
into this crucial stage early, and also to get know our client more, a long-term contract allows
us to provide our client with more direction and figure out a long-term plan to make sure the project
is sustainable. The cons are we don’t have much flexibility and could get stuck with a bad
client, not every client relationship is perfect, and sometimes you just have to pull the plug
for the benefit of your business.