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Smarter purchasing to manage pressures in the UK hospitality market

Whilst the conversation around business rates continues across the UK hospitality sector, one thing is clear: costs and guest expectations are rising.

These changes create a unique moment to reassess purchasing decisions, explore efficiencies, and tap into new ways of working, because procurement is one of the most effective tools for protecting margin and creating resilience. Whilst large brands benefit from strong negotiating power and volume purchasing, independent and smaller hospitality businesses should leverage other resources to beat costs and disruptions.

So how can businesses identify value in their current operations, stay informed on market developments and meet guest expectations? With the right tools and some practical techniques, hospitality owners can access better prices, improve efficiency and continue delivering exceptional experiences for their guests.

Standardise & rationalise what matters

Too much choice in products at your hotel creates unnecessary cost, waste and operational inconsistency. Optimising your inventory through product rationalisation & standardisation can help to identify items that are not adding value to your business. Will medium eggs instead of large eggs lower your guest satisfaction? In many cases, these small changes will hardly impact the guest experience. Moving towards full-size amenities across your business, limiting the items in your minibar or buying bigger packages can all impact your costs positively. Make sure your departments are not ordering in silos and benefit from volume purchasing within your own hotel.

eProcurement Tools

Real-time visibility into order & spend behaviour allows hoteliers to evaluate purchasing decisions more effectively. Businesses that order from multiple suppliers benefit from the usage of an eProcurement system. These systems provide instant oversight in spend behaviour through reporting and drive operational efficiencies across all departments.

Market reporting

A data-driven approach also supports hotels to develop a competitive advantage when adapting to changing price fluctuations. Market development reports or commodity price reports for example deliver data that helps hotels negotiate fair industry prices. Gaining access to these market insights can therefore be crucial for cost reductions and to anticipate product shortages. Make sure to check your invoiced prices against agreed rates for top spend items regularly to avoid unnoticed price increases.

Rationalise suppliers

In case you wish to operate without an eProcurement tool, you can improve your visibility by working with a smaller group of suppliers. Using a wholesaler for Food or a single distributor for your Beverages can help you gain better commercial outcomes and reduce complexity. Less supplier fragmentation means that small or independent businesses can benefit from defined delivery days and clear MOQs. Larger hospitality groups gain additional value by coordinating delivery schedules, improving drop density, and reducing surcharges.

Look ahead with your suppliers

Working with a smaller group of supply partners enables you to build stronger relationships and collaborate more effectively. A well-aligned supplier can help you anticipate and reduce logistical issues during unexpected disruptions or peak‑demand periods. Regularly discuss what’s ahead such as expectations of harvest yield due to weather conditions, higher volume requirements due to events, and trends that could influence top‑selling items. Your supplier often has these insights available to share with you.

Group Purchasing Organisations

Building a strong supplier network however takes time. Becoming part of a Group Purchasing Organisations (GPO) helps you to uncover the benefits of volume purchasing, saving you time & money as prices are negotiated by the GPO for a larger group of buyers. Being part of a GPO therefore also helps reduce supply chain risks, allowing increased resilience to disruptions with back-up supplier options and stronger supplier relationships held by GPO agents.

By uncovering value within current operations, staying close to market trends, and leveraging the right insights and reporting tools, small business owners and operators can build resilience and unlock new opportunities. The only answer is that you might not be able to achieve all of this alone. Invest in the right tool or people who can help you find more value in your business and deliver guest expectations.

If you want to learn more about the benefits that a Group Purchasing Organisation can bring to your hospitality business, visit www.hsm.com