Guides and White Papers
9 Questions to Ask When Choosing a GPO
How to Evaluate Potential Group Purchasing Organization Partners for Your Multi-Location Hospitality Group
Whether you’re part of a large procurement department or are operating as a team of one, choosing a group purchasing organization to protect your margins is the smart way to go.
Business owners and operators worry about inflation cutting into their profits. The cost of goods and services is even driving some hospitality-driven businesses into the red.
It doesn’t have to be this way, especially for multi-unit operators who need to leverage cost savings and process improvements across locations and teams.
Solving Your Hospitality Business Challenges with a GPO
If you’ve decided to work with a GPO, here are the nine questions that you need to ask before jumping into a relationship. Here’s what you need to know and how Entegra solves the unique challenges facing hospitality-driven businesses.
1. Is this GPO partner an expert in hospitality?
Each industry has its nuances and unique needs. A group purchasing organization has to understand the headwinds that you’re facing with staffing, supply shortages, inflation, and more.
The solutions that a GPO brings to solving these challenges should reflect your reality in the hospitality industry.
In addition to specific industry knowledge, Entegra’s clients work with supply chain experts, procurement professionals, culinarians, dieticians, hoteliers, and more who bring decades of experience operating businesses and working for major brands. They bring a deep awareness and understanding of your challenges to help us develop solutions tailored to your needs.
2. Do they have the best savings for my most frequently purchased categories?
Every GPO will tell you that they’re the best.
Entegra is the world’s largest food GPO and can leverage over $36 billion in purchasing power globally to negotiate the best savings for our clients.
Learn more about potential savings
3. In addition to saving on food and beverage from national suppliers, where else can they help me save?
Not every GPO can offer you access to international, national, and local products. You should ask about a GPO’s reach into the local suppliers that you like working with to see if there are opportunities to save under a GPO contract.
Entegra’s Local and Direct program provides a wide range of specialty food, FF&E, MRO, office supplies, technology, and products in many other categories. This breadth of goods and services gives you the best possibility of getting what you need at a price that fits your budget.
4. Do I need to pay any fees?
You need to know how a GPO makes its money. It should never be from you.
Entegra has no fees for joining, and we’re paid by our suppliers.
5. Beyond invoice savings, what other solutions can this GPO partner provide?
You may be looking for a GPO partner for savings on food and other goods. But a large group purchasing organization can offer so much more. In the long run, starting with a partner with a wide range of services may save you time and money.
In addition, when you purchase from Entegra’s contracted programs, you can earn rebates. Rebates regularly provide cash back which can become an additional revenue stream. We work with manufacturers to negotiate the best possible rebates for you. Other solutions include culinary services for our clients through the Entegra Performance Kitchen with menu optimization, product cuttings, as well as research and development.
Some of the other services we provide include SKU rationalization, supplier consolidation, compliance with food safety regulations, front-line staff training, and more.
6. Will I have to change suppliers when working with a GPO?
If you have a supplier that you love working with, and it makes financial sense, you can continue that relationship.
With Entegra, you can continue to purchase from your preferred supplier/manufacturer, even if they are not on the Entegra program. You’re never locked into only buying under Entegra’s programs. What you may find, however, is that the negotiated pricing through Entegra’s contracts may be better for your bottom line.
7. Can this GPO help us reach our corporate social responsibility (CSR) goals?
Increasingly, consumers are scrutinizing a company’s commitment to and actions on sustainability and corporate social responsibility. Not only should you ask about a GPO’s own commitments, but also how they plan on helping you reach your goals.
From developing sustainable, plant-forward menus to adding diversity to your suppliers to reducing your carbon footprint, Entegra can help.
You can buy from our list of suppliers who are committed to sustainable supply chain practices. We also help food service operators with food waste management through LeanPath, a service helping companies avoid over-purchasing and wasting food.
In addition to sustainable purchasing and food waste management solutions, Entegra has a wide range of energy management programs to help clients reduce Scope 1, 2, and 3 emissions.
8. Does this GPO provide actionable insights that can help my business?
As an owner or operator, you should want a partner who can give insights into the marketplace. Especially if you feel like you’re reacting instead of being proactive with trends, new products, or product changes, adding a GPO with a dedicated and experienced team of professionals can help take your business to the next level.
Entegra has a whole host of insights, from industry white papers, bi-weekly program updates, and inflation updates. Our team works to provide important news and information that you can use to make strategic decisions.
9. What digital solutions does this GPO have to help me?
GPOs can provide members with data analytics tools that allow them to track their spending and identify areas where they can save money.
Entegra’s Purchasing IQ platform, Savings Optimizer, enables our clients to see what they are purchasing, and the potential savings opportunities of switching or substituting products.
Entegra’s cutting-edge data, analytics, and digital tools enable greater control of your purchasing, better visibility into unit-level compliance, and more thorough auditing of distributor pricing, all for stronger business performance.
Learn more about Purchasing IQ
Still not sure if a GPO is right for your business?
To optimize your business performance while improving margins, speak to the experts at Entegra, the world’s largest food GPO.