Chapter 1
The purchasing process begins when...
Needs are determine
What is the difference between EP and AP?
EP refers to weight of a product after it is processed, prepared, and cooked, and AP is before that.
What is par level?
A specified quantity of products that should always be in inventory.
What does NBG stand for?
National buying group
Par level is 9. In stock is 2. How many is needed to order?
(CHAPTER 3)
7
History predicts...
The future
Quality standards are...
The factors used to compare an actual product or service with the desired product or service.
What is a sales history?
Offers a wide variety of products
What is a stockout? (CHAPTER 2)
Occurs when an item is no longer available in inventory.
To minimize unnecessary or excess inventory, a purchaser should (any of the 4 is acceptable):
1. purchase according to accurate forecast
2. Anticipate cash needs
3. Consider available storage space
4. Think about future costs
Define IQF
Individually Quick Frozen which is vacuum packaging, no oxygen in the package to better preserve taste, texture, and nutrient values
What is the menu popularity index?
Percentage of customers likely to order specific menu items
In high-volume organizations, the vendor evaluation is typically performed by who?
The purchasing staff.
What is competitive bidding?
(CHAPTER 2)
A strategy for comparing vendors' prices for products of acceptable quality to determine the lowest price
In independent/single unit operations, the person responsible for purchasing is:
the owner-manager
It is a best practice for a vendor to identify acceptable substitutes for products originally requested. Why?
Saves time and effort
Define a standardized recipe
Provides detailed instructions, including the amount of every ingredient, to produce a food or beverage item
What is a local distributor?
They order and receive products shipped from the manufacturer location. Then store and transport products in necessary quantities to the operation's unit.
Define value (CHAPTER 1):
the relationship between the price paid and the quality of the products, services, and information recieved.
Request for Proposal
There are 3 basic types of purchasers. Name one:
1. Price conscious
2. Quality conscious
3. Value conscious
Describe the problem excessive quantities of purchasing products has on cash flow
Products in inventory for long periods must be paid for before being used. Payments require cash that can be used for other purposes.
What is vendor sourcing?
Making decisions about which vendors will be asked to submit prices for the products needed
When it comes to forecasting, a good indicator is:
(CHAPTER 3)
What has happened in the past predicts the future
There are several external factors that impact purchasing decisions. Name 2:
competitors
customers
distribution channels
global trade conditions
government regulations
environmental concerns
Using the exact name of something being purchases helps ensure...
The correct item will be purchased, and to prevent frustration or misinterpretation for the buyer and vendor
What is an easy example of LIFO purchasing?
Baked goods or dairy products
There are several advantages to using a broad-line vendor. List 1:
Reduced per-unit costs with increased purchase volume
Decreased costs of purchasing and accounting aspects
Less time required for purchasing tasks
Less time required for product-receiving activities
Reduced time needed to evaluate, select, and interact with specialty-line vendors
What is a petty cash system?
(CHAPTER 3)
A cash fund used to make infrequent and low-cost purchases
F F & E stands for:
furniture, fixtures and equipment
Quality standards are developed in recognition of an operation's (name 1 of 4):
concept, location, customers, and competition
What is a minimum-maximum inventory system?
Requires the buyer to determine the minimum and maximum quantity that inventory levels must fall between
What type of operation do you typically see NBG's?
Franchises or multi-unit operations
Why should purchasers conduct on-site inspections?
To observe factors such as work methods, cleanliness, and general organization.
~also acceptable~
View recent inspection from USDA or 3rd-party inspector, and based on Good Manufacturing Practices (GMP) or Good Agricultural Practices (GAP)
Name two of four: a purchaser must have these different type of abilites:
technical skills
conceptual skills
interpersonal skills
ethical character (under "other skills")
What are the first 2 steps in developing and implementing specifications?
Determine needed products
Learn about available products
If an AP price per pound is 22.95, and the edible yield percentage is 72%, what is the cost per servable pound?
31.88
Why must vendors have a HACCP in place?
To control risks and hazards throughout the food supply process.
What is a specialty-line vendor?
(CHAPTER 4)
Purchasers - especially from the oversight of a general manager, must avoid (any of the 3):
unethical, illegal, and unprofessional actions with those from whom they buy
Quality can be defined by when a buyer first determines what the produce is to be used for, and then that product...
Becomes the one most suitable for its intended use at the lowest cost
What is JIT purchasing (complete name and definition)?
Just in time: a purchaser has a long-term commitment with a vendor to make frequent product deliveries
NBG's offers a number of benefits. How so? List 1 out of the 3 possible answers:
Identify products that meet specific standards
Negotiate prices that meet these standards
Address many contract details that favor their organization
There are several conditions that need to be met for a minimum-maximum inventory system. Name 2:
(CHAPTER 3)
purchase specifications exist for the products and quality doesn't change
vendors product prices are constant
products are used in relatively consistent quantities
products are expensive and require stronger controls
same type of products will be used in the future
Products are not extremely perishable
maximum quantities do present storage issues
stock is rotated and theft is minimized