Food Suppliers and Pricing

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nvb
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2005/04/11 16:21:13 (permalink)

Food Suppliers and Pricing

Since I've only been in the restaurant business for 18 months I'm still trying to get a handle on my costs. I started out buying from Ben E. Keith and due to a problem with my rep I switched to Sysco. Sysco started out saving me money, but has since steadily raised prices.

I've been told that their managers get into the accounts and manipulate the pricing. I confronted my rep about this and he denies that it happens. He just writes it off to rising prices and fuel costs, which maybe true.

Anyone ever had the experience of getting hooked with a company and have them manipulate pricing?

And thank you for this forum.
#1

31 Replies Related Threads

    zataar
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    RE: Food Suppliers and Pricing 2005/04/11 18:49:04 (permalink)
    I was once in that situation and it was with Sysco! I felt it was a case of manipulation, but by Sysco's standards I was a small account. I did indeed confront my sales rep and she denied that such thing was going on. Business is business, I guess. All of my current suppliers have had to raise their prices and all are imposing a fuel surcharge. I prefer to use smaller suppliers that may cost slightly more, but the service we receive more than makes up for it. I've never had a sales rep from Sysco run something to me that was left off the truck. I'm fortunate that I'm able to use smaller local companies, not everyone can afford to do that.
    Thanks Stephen, this will be a good forum.
    #2
    BT
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    RE: Food Suppliers and Pricing 2005/04/11 21:14:31 (permalink)
    Any of you familiar with United Natural Foods? What do you think of them?
    #3
    lleechef
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    RE: Food Suppliers and Pricing 2005/04/11 21:45:48 (permalink)
    When cheffing in Boston area I used Sysco exclusively. I love Sysco. Here in Alaska I use FSA (Food Services of America) as Sysco does not have the variety of products available.
    I think that all you professional chefs will agree with me that your rep is the KEY to a good relationship. I once called my Sysco rep because the lamb racks came in with the chine bone ON! I nearly flipped! I don't have a band saw in my kitchen! He came to my restaurant, picked up the lamb racks, went to our local grocery store and persuaded the butcher to run those racks on the band saw. Sysco had nothing to do with it..........it was ALL the rep!
    #4
    blizzardstormus
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    RE: Food Suppliers and Pricing 2005/04/11 22:37:54 (permalink)
    I have dealt with Sysco for 20 years throughout the U.S. It has ALWAYS been the rep who kept me with the company. Unfortunately, with the enormous size of Sysco & rising fuel & meat costs, the Accounting Department seems to be overruling any deals my current rep has set up for me. Keep Sysco (for that matter, any food vendor) honest by dealing with more than just one supplier. The threat of using a different supplier is the only real way you can keep your current vendors honest.
    #5
    lleechef
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    RE: Food Suppliers and Pricing 2005/04/12 00:34:11 (permalink)
    I dunno blizzard, I used to check prices and compare, pit company against company, Sysco's Heinz ketchup was 3 cents more than Kraft Foods.....but Sysco was cheaper on canola oil. I finally gave up. I had a fantastic rep so I stopped banging my head against the wall and just went with Sysco. I still managed to run a below 30% food cost so it worked for me.
    #6
    The Travelin Man
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    RE: Food Suppliers and Pricing 2005/04/12 00:56:34 (permalink)
    I think that this is something that happens in any time of wholesale/retail vendor relationship. I used to work in the wholesale flower business and we were generally the small, local wholesaler competing against the larger, national wholesalers. What made our business was the relationships that we had with our customers. I knew nothing about the flower business when I started, yet my customers needed someone who they could rely on to give them straight information -- about pricing, quality, new/improved products, etc. In addition, they also knew that I was the one who would make an extra delivery on the way home from work, or come in on a weekend when they had an emergency funeral come in. When I left the company, I was the #3 (of 8) salesman, in terms of $$/month sold.

    Now -- how does this relate? Well, there were some customers who shopped price on everything, some who shopped quality, and some who did business with whomever they were most comfortable, regardless of price or quality. Invariably, the shops that thrived were the ones who favored quality product over inferior cheap products. So, if you are comfortable with the level of service you get from your Sysco rep, and you are pleased with the quality of their product, you likely shouldn't worry about the nickel and diming.

    I would think that we are all going to see these increases in prices across the board as fuel remains at historically high levels.

    Steve
    #7
    MikeS.
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    RE: Food Suppliers and Pricing 2005/04/12 02:40:28 (permalink)
    I spent several years doing delivers and warehouse work for a food wholesaler, first they were a small private company and then they were bought out by Continental Foods(coffee) in Chicago. We usually stocked our delivery trucks with extras just in case the customer had forgotten to order or whatnot. Many times I was the guy assigned to drive a case of something 40 miles one-way because a customer had forgotten or the item wasn't delivered because of our problem. It was a good school time job and i learned a lot about the restaraunt commercial food preparers. The Rep really did matter and a lot of people bought because of them alone.

    MikeS.
    #8
    nvb
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    RE: Food Suppliers and Pricing 2005/04/12 08:19:12 (permalink)
    I'm getting great service out of my Sysco rep. He has been a great help to me and he will hot shot anything that gets screwed up or I forget.

    What I'm talking about is that $23.00 box of potatoes I got hit with a few weeks ago. Looks to me like they will hit you like that until you catch up with it. In this case I mentioned it right away and when he checked it was changed back to $13.00. I don't usually have the luxury of refusing something like that, so I get soaked with it.

    So I guess I'm wondering if this is a Sysco thing or is it across the board in the food supply business?
    #9
    UncleVic
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    RE: Food Suppliers and Pricing 2005/04/12 09:27:33 (permalink)
    Around here, Sysco is expensive.. With that said, it's not all bad.. The sales reps always keep you up to date with specials, and if something is missed on an order the sales rep will jump in his car and personally make it right. Our other major supplier, Gordon Food Service is alot cheaper.. I like using them since the business is based right here in Grand Rapids! BUT, all is not good... Sales rep are eager to take your order, but yet fail to report on specials or new items. Seems like they're in too much of a rush all the time... Both have their positives, but I prefer Sysco for level of service..
    #10
    Michael Beam
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    RE: Food Suppliers and Pricing 2005/04/12 10:51:47 (permalink)
    I have been in the business for many years and it is not uncommon for prices to change dramatically from supplier to supplier, week to week. However, I have not ever experienced (or heard of it being done) intentionally manipulating prices to gain an account. After all, it is the service and personal relationship that keeps you happy (as noted in this forum). Vendors are not going to jeapordize that relationship for a few dollars.

    I always have found it best to competitively shop for prices on high dollar items or items that have a substantive impact on my food cost. I recommend that you identify a few vendors for those items that have an impact on your operation and shop those each week(pick your top 10 items). It will lower overall costs while only taking a minimal amount of time. It will also have the side benefit of fostering a little competition among your suppliers which is never a bad thing.

    I would also recommend that you look at your invoices as they arrive to check ordered pricing versus delivered pricing. I have often found that the price quoted when I placed the order is not what shows up on the invoice. Being diligent about checking will take some time at first, but should result in chasing down fewer credits after the fact if you can catch it at the back door on delivery.
    #11
    zataar
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    RE: Food Suppliers and Pricing 2005/04/12 14:44:50 (permalink)
    I've been fortunate in my career to have established great working relationships with many of my sales reps. I've even switched suppliers when one particular rep changed companies. It does seem in my area if you aren't a large account you don't always get the greatest service. And I've noticed that some of the much younger reps don't have the same sense of customer service. It took me 3 weeks! to get my Sysco rep to call me back about a $1000 cookware order. That may have been peanuts to her, but it was the deciding factor not to use them anymore. I'm not out to dog Sysco, I think as Michael Beam said and lleechef stated, watch your pricing, be aware of delivery prices and establish a good working relationship with your rep. Ask for another one if the rapport isn't there but you like the company. If they want to keep you they should oblige.
    #12
    lleechef
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    RE: Food Suppliers and Pricing 2005/04/13 05:55:10 (permalink)
    I agree with all the above posters. As the tractor-trailer was pulling up this morning at 7AM and the guys were unloading my order the phone rang and it was my FSA rep asking if everything came in alright, that I got shorted on basil but he would bring it by around noon. Now, THAT's a GOOD rep!
    #13
    rumbelly
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    RE: Food Suppliers and Pricing 2005/04/13 08:02:24 (permalink)
    I agree with Michael Beam in selecting your top high cost items and watching them closely. Another area is chemicals and paper goods. One stop shopping is easy but don't think even your friendliest and most efficient rep won't spot that one a mile away. One that gets me about Sysco is the minimum cost of delivery. We spend a lot over the course of a year but being in a somewhat seasonal area there are many weeks when I can't make the minimum without padding it with stuff don't need. What makes it worse is the truck is in town anyway across the bloody street! So I use a more local company for about 1/2 my orders now.
    #14
    nvb
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    RE: Food Suppliers and Pricing 2005/04/13 08:11:35 (permalink)
    quote:
    We spend a lot over the course of a year but being in a somewhat seasonal area there are many weeks when I can't make the minimum without padding it with stuff don't need.


    Without making this a bash Sysco thread, I know what you mean. I started with them at a 10 case minimum, then a few months later it increased to 12. Now, it's 15. If my business had not grown during this time the new minimum would restrict me from dealing with Sysco.

    I guess y'all have answered my question. Thanks!
    #15
    blizzardstormus
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    RE: Food Suppliers and Pricing 2005/04/13 18:07:45 (permalink)
    Definitely, check your quoted prices from the rep versus actual delivery prices. Because of the way the computerized Sysco system works, a price quoted by your rep may be overruled because a new shipment arrives at a higher price. A good rep knows these kind of quirks in the system and attempts to catch them. However, he or she can't catch everything. Again, keep them honest.
    #16
    C&TDESIGN
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    RE: Food Suppliers and Pricing 2005/05/18 10:25:59 (permalink)
    I have a friend who recently interviewed with Sysco. The person who interviewed her said their turnover rate is very high. She was told that not only does she own the accounts,pricing, sales, etc... but if any of her accounts fail to pay for their orders, she is personally responsible for that amount. They will deduct those amounts from her paycheck. She said the don't offer any expense reimbursements (mileage, meals, travel, wireless phone) and you must use your own vehicle for calling on your accounts. Needless to say she did not take the job. If this is how they are conducting business, it is no wonder the reps are putting in price increases. This probably helps them pad the accounts to pay their own overhead!
    #17
    nvb
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    RE: Food Suppliers and Pricing 2005/09/27 16:49:01 (permalink)
    Maybe I'm now bashing Sysco.

    My rep turned in his two weeks notice to Sysco last Friday, and let me know that they took his laptop and he wouldn't be by on Monday for an order. This made me think a little and I called a Performance Food Group rep (that had solicited me before) that same afternoon. I sent him my product list and you wouldn't believe the pricing difference. He priced his briskets at 30 cents a pound less, and across the board I'll save quite a bit on every order. He even beat some of the prices from the other suppliers I've been dealing with.

    After looking at the numbers it appears that they were picking and choosing which products to soak me on. Can we say 12 bucks for 5 lbs of lemons? It makes me sick, but I didn't keep up the pricing as well as I should have, so I can only blame myself.

    Y'all were right when you said to watch my prices.
    #18
    bassrocker4u2
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    RE: Food Suppliers and Pricing 2005/09/28 06:49:06 (permalink)
    sysco definitely has some issues. many years ago, down in fl, i used sysco as my main supplier for my pizza/sub shop. they were great!
    then......i figured with such a great experience, i would use them here, in ga, for my bbq shop. aarrggghhh!!!!
    i dont know if the entire corporate has changed, if the sales person is the true difference, or what, but here, i wouldnt pull them from a burning building!
    they screwed me over big time, and it tooks me a year to get over it.

    well, things were going fine, i was ordering well above the minimum. i noticed the price change in certain items that were not commodities(commodities flutuate week to week). after useless attempts to regain good prices from my salesrep, i brought in u.s. foods. my sysco rep saw u.s. boxes at my place and went ballistic. there are many things wrong with that. first, its still america, i can still buy from whomever i choose. well, anyway, sysco dropped me as a customer. i've never heard of such a thing. i was called a 'cherry picker' by my rep, who said they would not ever deliver to me again. most things that would not matter, but one particular item i bought from them was only available through them. i had spent thousands on advertising that particular item on t.v. and radio and coupons.
    all that money down the drain, as i could no longer provide it to the customer. i lost 2k a month gross sales from that one item.
    was the problem the rep, or the company. i am not sure, but i have since recovered, and i am pleased with u.s. foods. my prices havent changed in over a year. even the commodities have stayed the same.
    #19
    Scallion1
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    RE: Food Suppliers and Pricing 2005/09/28 07:16:13 (permalink)
    b-rocker,
    and would you be willing to divulge the nature of this proprietary item?

    anyway, i've gotten stuck using sysco or other, similar vendors from time to time, and i think they all suck. it's not that they want to be creeps, i don't think, but that if you're using them you probably haven't got many choices.

    years ago when i ran the kitchens at a hotel out on the east end, we had to use some such service because (except for our butcher, who made weekly runs from nyc with beef, lamb and veal) there wasn't a local guy with a big enough product range.

    overall my experience is that with sysco et al the tail wags the dog. i always wound up changing my menu to meet their specs and their lines. and whatever i might have saved on their pricing (which i ALWAYS found arbitrary, indecipherable and untrustworthy) i lost on waste because i bought in bigger quantities than i needed.

    the only time i'd ever use them again, and god please forgive that this should ever occur, would be in an institutional setting.

    rocker, did you ever sell the bbq place?

    #20
    Raine
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    RE: Food Suppliers and Pricing 2005/09/28 16:27:08 (permalink)
    We haven't even called Sysco due to all the negative stuff we've heard. Called US Foods and the rep was calling every couple days(before we opened) wanting to meet us. Well, he finally did meet us and we gave him a list of items we would be purchasing and asked for a price list. Haven't heard anything from them since. We have called bakeries for our bread products and can't get them to send out a salesperson. Had one bakery who told us their min was $75, and if we went 2 weeks without meeting that min, they would drop us.

    We get a few of our items from ijFoodservice, the rest from SAM's and the local grocery stores.
    #21
    Scallion1
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    RE: Food Suppliers and Pricing 2005/09/28 21:33:14 (permalink)
    Do you have a Costco down there? Up here they've started local deliveries to businesses, and I know that you can buy meat by the box. More expensive than what I can buy up at the wholesale meat market, but not bad.
    #22
    Raine
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    RE: Food Suppliers and Pricing 2005/09/29 07:59:12 (permalink)
    Yes, we have a Costco, but don't think they can beat SAM's price. We went there once and was not impressed with anything we saw. Had a card for a year and never bought anything there.
    #23
    Scallion1
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    RE: Food Suppliers and Pricing 2005/09/29 09:05:40 (permalink)
    You'd know better than I. Up here no one can touch Costco for price or quality among the big-box stores, imho.
    #24
    nvb
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    RE: Food Suppliers and Pricing 2005/09/29 09:13:27 (permalink)
    Sometime last year I got a call from Sams Cub asking if they could send someone by to talk to me about delivery. I told them sure but have not heard a word from them since and it's not available Does anyone have it in their area?
    #25
    Raine
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    RE: Food Suppliers and Pricing 2005/09/29 09:17:48 (permalink)
    They have the click & pull, but haven't heard anything about delivery. Maybe it is available in limited areas, or maybe they are test marketing the service. It would be nice to have SAM's deliver.
    #26
    bassrocker4u2
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    RE: Food Suppliers and Pricing 2005/10/01 08:35:53 (permalink)
    personally, i wouldnt want sams to deliver. nor would i use the click and pull. reason being, that they are prone to not rotate product well, and often i am pulling fresh stuff from under cartons, from in the back, on top, or where ever else it may be hiding, because the stuff up front is expired, or damaged, or on its last leg. i am way too picky for them to deliver. i cringe even now, when u.s. delivers.
    i check every single item i receive. sometimes they will try to slip in rotten potatoes. my bread guy drives me crazy! i think his stop before me must be on a dirt road, cause the pillows are always covered in sand and have to be cleaned off. before entering the restaurant. i can only gripe so much before i just 'swallow and go'.
    one time i refused them, and the supervisor had to bring out more bread. well, his bread was of a less quality, so i learned not to refuse any more..heehee
    nope, i didnt sell the place yet. we have had a few folks come and look at it, and a few more are scheduling to do so. i think once people realize that they have to get down and dirty, work for a living, they kinda get scared of it....i dont know. the last guy was a restaurant manager. well i should have known. they usually just want to hire a crew to patronize. not at my place. the owner has to do the work!
    #27
    nvb
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    RE: Food Suppliers and Pricing 2005/10/01 08:45:54 (permalink)
    I use click & pull just about every Saturday and I've had only one problem. It's convient because I have to dive 45 miles one way and it's nice to have my order waiting on me.
    #28
    dreamzpainter
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    RE: Food Suppliers and Pricing 2005/10/01 10:56:37 (permalink)
    I worked part time for a messanger service in the philly area, running between DC and NYC with everything from a single letter to canisters of film. I was often requested by Sandy Mac (a restaurant supplier) sometimes for a couple case of dishware or a couple boxes of supplies, one time a single box of plastic wrap to Cape May
    #29
    Burgerman1
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    RE: Food Suppliers and Pricing 2005/10/18 14:02:16 (permalink)
    I have found that with the big boys, Sysco, US Foodservice, IFH that it's not them rising prices, but that I always found one or two items that would be inflated every invoice. Example, 500ct Deli Wrap would jump from a normal $4.99/box to $6.50/box...this might happen for one or two weeks and then back down to normal price. I always found that odd.

    As far as current prices in the last two years there have been some increases, but not what you would expect, I project that rising prices will be the norm during the next 12 months with rising fuel costs. The decreasing profits right now I attribute more to rising operational costs, electrical, gas, linen services, pest control, etc. The only way to beat this is to do more business.

    I agree with a former poster, sometimes we can spend more time shopping for a low price than if we just accepted the price and worked more on increasing business. Don't get me wrong I do keep track of all incoming prices, and I let vendors know when they are getting out of line, with the volume that I do I can afford to have more than one vendor, and if I have to I can switch and make a dent in a salesman's take home pay.

    Howard
    #30
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