Supporting Best Practices

While we at Seva Procurement would like to believe we invented everything there is to know about supply chain management and procurement, we know this is just not so!  Our model at Seva is not to try and create a gimmick or offer free money for doing nothing, as this is not what supply chain management is about and will ultimately not provide the value that can be achieved through true strategic procurement.  Rather, Seva is about embracing Procurement Best Practices as they relate to the hospitality industry and to work with our clients to realize the benefits that they provide.  While Seva remains one of the most flexible hotel procurement services organizations in the market, we believe that as your procurement partner, it is our responsibility to build a program based on these hospitality best practices and to seek to coach and educate your personnel whenever allowed.

Product Standardization

It’s all about consistency!  The products your personnel select have a huge impact on both the guest experience and your organization’s bottom line.  “Cherry picking” and using multiple suppliers greatly increases this inconsistency, a hallmark of the antiquated transactional purchasing model.  On the other end of the spectrum is “strategic procurement,” which is the process of supplier and product rationalization based on the price/quality/perceived value equation.  Seva supports this best practice by working with key member personnel to standardize product specifications for the vast majority of products.

Purchasing through Supply Chain Contracts

It seems simple, but we are amazed at the number of operators that fail to have proper contracts in place with their suppliers.  Lack of contracts greatly increases the cost of goods and services, as well as creating significant risks related to product safety and potential liabilities.  Seva members can rest assured that they are embracing this best practice, as 100% of products purchased through the Seva program are tied to industry-leading supplier contracts.

Reduced Fraud Through Increased Operational Transparency & Barriers

The hospitality industry is made up of vibrant, energetic and talented individuals.  It is always a best practice, however, to ensure that systems are established aimed at limiting ethical issues and fraud.  When it comes to the area of procurement, regardless of the industry, the vast benefits of transparency and barriers between the supplier and decision maker have long been understood.  By utilizing Seva, these barriers and transparencies are automatic, eliminating any potential for vendor related fraud.

Indemnification, Product Safety & Quality Assurance

While most properties tell us that they are always on the lookout for the best price, we rarely hear that properties are actively ensuring they are indemnified by their suppliers or that they have contractual product safety and quality assurance requirements in place.  Failure to do so can be much more costly than the actual price tag of a product.  As part of the contracting process, Seva Procurement ensures that industry-leading standards are established as it relates to these issues. 

Create Baselines to Promote A Culture of Ongoing Improvement

Measured improvement in any area is an ongoing process, one that Seva executes through adoption of Six Sigma best practices.  Through the creation of product specifications and purchasing through distributor contracts, members are able to define and set expectations, and to then evaluate and renegotiate at later date, creating a process of ongoing, measured improvement. 

Purchasing Standards & Contracting Continuity Independent of Personnel Changes

While key member personnel are often highly talented individuals, it is never a best practice to have key product, supplier and purchasing procedures dependent on any given employee.   To reduce the risks that this creates, Seva promotes working with key member personnel to create published member specifications.  Further, the portfolio of Seva supplier programs and our e-Procurement platform ensures that regardless of personnel changes, your business will always have continuity in terms of supplier pricing and product consistency.

Auditing

Trust but verify.  While it is rare for Seva to come across a hospitality property that has executed supplier contracts for their primary vendors, it is even more rare for us to find an operator that both has these contracts and executes supplier audits to confirm compliance with the stated terms.  Seva routinely audits all of our supplier programs to make sure that members are continuously benefiting from the program.

E-Procurement

The jury is in and e-Procurement is now considered a best practice.  Utilizing e-Procurement enables operators to ensure published specifications are properly implemented by aligning hosted order guides with these requirements.  Additionally, adopting this technology greatly increases employee efficiency by streamlining the purchasing process and reducing mistakes that occur when orders are placed manually.  Finally, using e-Procurement enables systems integrations to create significant accounting and reporting efficiencies.

Supply Chain Efficiencies

No matter how good someone is at contracting, it is impossible, on average, to negotiate contracts that will deliver a product for less than it cost to manufacturer and ship--this is basic economics.  Too often, we find operators focusing solely on the delivered cost of a product, with no concern about the third-party input costs that ultimately drive the price--it is the mentality of "that's your problem."  Unfortunately, the truth is that if these operators worked with their suppliers to understand these input costs and what drives their costs, then all parties can work together to try and lower unnecessary costs that drive up the price for everyone.  Typical examples of these supply chain efficiencies relate to minimum orders, average delivery drop sizes, expected customer representative service on property and payment terms.