Andrew Hale Feinstein
John M. Stefanelli Edward G. McKeown
Instructor’s Manual to Accompany
Purchasing
Selection and Procurement for the Hospitality Industry
Seventh Edition
JOHN WILEY & SONS, INC.
ii
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Purchasing: Selection and Procurement for the Hospitality Industry, Seventh Edition, by Andrew Hale
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Printed in the United States of America
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1
CONTENTS
Preface
Notes to the Instructor
Suggested Course Syllabi
Suggested Term Projects
iv
vi
ix
xviii
Key Concepts and Suggested Questions for Each Chapter
Chapter 1
The Concepts of Selection and Procurement
Chapter 2
Technology Applications in Purchasing
Chapter 3
Distribution Systems
Chapter 4
Forces Affecting the Distribution Systems
Chapter 5
An Overview of the Purchasing Function
Chapter 6
The Organization and Administration of Purchasing
Chapter 7
The Buyer's Relations with Other Company Personnel
Chapter 8
The Purchase Specification: An Overall View
Chapter 9
The Optimal Amount
Chapter 10
The Optimal Price
Chapter 11
The Optimal Payment Policy
Chapter 12
The Optimal Supplier
Chapter 13
Typical Ordering Procedures
Chapter 14
Typical Receiving Procedures
Chapter 15
Typical Storage Management Procedures
Chapter 16
Security in the Purchasing Function
Chapter 17
Fresh Produce
Chapter 18
Processed Produce and Other Grocery Items
Chapter 19
Dairy Products
Chapter 20
Eggs
Chapter 21
Poultry
Chapter 22
Fish
Chapter 23
Meat
Chapter 24
Beverages
Chapter 25
Nonfood Expense Items
Chapter 26
Services
Chapter 27
Furniture, Fixtures, and Equipment
iii
1
1
8
16
28
42
51
58
66
81
93
106
113
126
135
145
155
164
174
184
192
201
212
221
233
244
253
264
PREFACE
This instructor's manual has been developed to assist those instructors who teach purchasing for the
hospitality industry. The primary objectives are to provide suggested lesson plans and a pool of questions
suitable for classroom discussions, homework, quizzes, and examinations.
The manual includes several possible course syllabi, key concepts of each chapter in the text, and
several multiple choice and true/false questions for each chapter, in addition to answers to the textbook
chapter questions. These features are discussed in detail in the next section.
Several strategies are presented that will introduce the students to the purchasing function in the
hospitality industry. Experience has shown that there are several methods for presenting course materials,
three of those methods will be the major focus of this manual. The First method exposes students to
purchasing principles and procedures which will steep them in the theory and practice of ordering, contract
administration, and product specifications. The Second method concentrates the instruction on food,
beverage, and nonfood product identification factors focusing solely on discussions of those products that the
typical hospitality manager purchases on a routine basis. The third method is a blend of the first two
approaches, which extract the best of both, while giving the students the benefits of the wider aspects of the
purchasing function. The text and this instructor's manual are structured to present the third method of
instruction and provide a solid foundation of what the authors consider to be an appropriate combination of
purchasing principles, procedures, and product identification factors.
Furthermore, at the end of each chapter are suggested discussion topics that the author’s have
included to address the role of management (i.e., how these discussions topics relate to the manager's overall
responsibilities, their application in the industry and how they might be utilized for career advancement).
Purchasing is but one element of the typical hospitality manager's job description. The manager must
be knowledgeable on a wide spectrum of issues and must also know and understand how these relationships
interact within the total scope of the hospitality organization. These instructional materials have been
developed to emphasize "purchasing for non-purchasing agents" primarily because students must learn
purchasing principles and procedures as well as product knowledge, but just as importantly, they must
understand how these activities all fit together in the well-run hospitality operation. With this goal in mind,
four term projects are incorporated in this manual to assist the instructor.
v
NOTES TO THE INSTRUCTOR
The textbook includes twenty-seven chapters. At first glance this would seem to be an
unmanageable number. However, as with most textbooks, some materials are easy to comprehend while
others are more challenging. Students should be able to assimilate much of the material through reading and
self-study while some of the more difficult concepts will require the instructor to develop and amplify key
concepts thoroughly with classroom instruction or discussion. Experience has shown that purchasing students
will usually encounter difficulty understanding the cost and order-size calculations as well as the concept of
product specifications. Those student who have never had the opportunity to work in the food or beverage
segment of the hospitality industry usually have the most difficulty grasping these topics.
Each class will be different in some respects; demographics, nationality, and experience from
semester to semester, consequently, the instructor will need the flexibly to alter the course to provide the
students with the most relevant learning experience. To provide some flexibility the authors have included
several possible term projects to help address potentially diverse learning styles of students.
The authors have provided three suggested syllabi, but there is sufficient flexibility within this
manual to allow instructors to adapt the material to suit their individual needs. Each chapter has been
intentionally structured to stand independent of any other one, thus providing the instructor flexibility to bring
in to the classroom outside speakers, field trips, and/or additional materials that will enhance the student’s
learning experience. The instructor has the opportunity to present a unique set of chapters without being
locked into a predetermined course outline.
While it would be ideal if all of the chapters included in the textbook could be introduced to the
students, the authors are aware of the time factors that impact classroom instruction. Instructors may find
it undesirable or unnecessary to cover each chapter or each key concept presented in the text, for instance,
it may be redundant to cover alcoholic beverages if students are required to take a bar management
course. The instructor could eliminate the FFE chapter if students must take a layout and design course as
well as just providing an introduction of the ordering, receiving, storing, and issuing topics if students
must take accounting and cost control courses. If some of the chapters and/or key concepts are eliminated,
the extra classroom time could be utilized for field trips, scheduling additional guest speakers, or
introducing other pertinent topics, such as selling techniques, negotiating tactics, and current product
popularity trends. Extra time could also be used to delve more deeply into one or more key concepts for
instance; one could devote extra time to the meats section.
Whenever possible, instructors are encouraged to arrange one or more tours of hospitality operations,
suppliers' warehouses, commissaries, and/or central distribution centers in order to illustrate and highlight
classroom discussions. These tours should be scheduled toward the end of the course, after the students have
been exposed to the basic concepts of selection and procurement. Tours at the beginning of the course are
discouraged primarily because most students will be unable to appreciate their application within the
hospitality industry. Experience shows that student’s are usually not conversant with the vocabulary of the
industry and therefore, will be unable to ask pertinent questions or engage in meaningful dialogue with the
tour conductors.
Guest speakers can and should be utilized throughout the course whenever possible. It is always
desirable to supplement classroom presentations with those delivered by one or more guest speakers. This
allows students opportunities to gain additional perspective. Effective guest speakers also prevent monotony
and boredom; moreover, guest speakers may be able to motivate your students to consider seriously a career
in purchasing or distribution as well as providing networking opportunities for the students when they
graduate.
vi
When scheduling guest speakers, take the time to provide them with a specific outline of topics to
cover. One or two war stories can enhance the learning experience, but the instructor cannot let this get out of
hand. Do not allow them to concentrate solely on impressing your students unnecessarily, to the detriment of
other more important tasks of covering pertinent material.
The first suggested syllabus, divides the material into twelve major sections. It is recommended that
each one be delivered by the instructor, a competent guest speaker, or the person conducting an appropriate
field trip.
The second suggested syllabus provides a sixteen-week semester lesson structure with two class
meetings per week. It encourages the assessment of student learning through a number of exams and a term
project.
The third suggested syllabus is also based on a sixteen week semester. This syllabus can be modified
to accommodate classes that meet on a Monday, Wednesday, and Friday schedule or a Tuesday and Thursday
class meeting schedule. This syllabus also includes a group project as a major portion of the course. The use
of the group project allows the students the opportunity to apply the lessons learned throughout the semester.
In addition to evaluation of convenience products students have the opportunity to develop their interpersonal
relations and group dynamics in order to meet the project requirements. The examination schedule is broken
down into five chapter segments that have proven manageable by the student given the amount of material
covered within the text. This syllabus also has built in flexibility for the instructor.
The authors are proponents of cumulative examinations and quizzes. In their experience, they have
found that students respond much better to this type of testing primarily because the students are forced to
stay involved throughout the course of the semester. If daily homework is also assigned and consistently
assessed as part of the student’s overall grade, a higher degree of involvement is virtually assured.
There are several short-answer questions included at the end of each chapter in the textbook and the
answers for these questions are contained within this manual. Additional information and suggested activities
also appear on the Web site for this text. The multiple choice and true/false questions included in this manual
are intended to supplement Web content. All of the questions can be entered into a word processor program
and coded so that they can easily be retrieved and used to prepare a quiz, examination, or homework
assignment. These questions should be treated as an initial pool of questions to give the instructor a starting
point for the development of examination questions.
Optional Assessment Options: Instructors have considerable freedom to consider allowing openbook and/or open-notes examinations if this is consistent with their personal teaching philosophy. While one
certainly does not want to make the course too easy for students, (for to do so would seriously understate the
dedication and commitment one needs to succeed in the hospitality industry), there are times when one needs
to "ease" students into the educational program in order to build their self-confidence. This course is usually a
lower division course within the degree program and may be the student’s first exposure to the world of
purchasing. Furthermore, with open-book and/or open-notes exams, students will not react negatively if they
feel you expect them to learn an excessive amount of material in a short period of time.
In addition to exams or quizzes, or in lieu of them, the instructor might consider assigning
homework, reports, projects, and/or classroom presentations. These additional exercises, especially classroom
presentations, are attractive to students majoring in hospitality management as they allow them to use their
creativity and demonstrate their people skills.
vii
A term project is included in the first suggested syllabus. The primary purpose of the project is to
give students sufficient practice in the preparation of acceptable product specifications. Instructors can make
this a single term project, or it can be assigned as portions throughout the course. Usually combining this
option as well as a few specification homework exercises and the product-specification term project provide
the students with a solid foundation in the principles of purchasing.
An optional term project is also included with this manual. If desired, this particular project can be
easily incorporated into the second sample syllabus provided. This term project requires students to write a
research paper. The main purpose of the project is to enable students to demonstrate their skills in
establishing a purchasing system, policies and procedures for purchasing, ordering, receiving, storage,
inventory control and issuing of products and services for a hospitality operation. Students are also asked
to develop appropriate specifications, forms, and records for effective purchasing practices for the
hospitality operation.
Teaching a purchasing course can be very challenging for both the instructor and the students. The
proper instructional approach is subject to a great deal of opinion. And unlike other hospitality courses, there
is usually more coordination and demonstration work that must be done. The authors have attempted to
include as much flexibility as possible throughout this instructor's manual. It is not intended to be the final
word in how purchasing should be taught, rather it gives the instructor a good starting point and it is hoped
that the suggestions noted herein will make that job a bit easier.
viii
SUGGESTED COURSE SYLLABI
SAMPLE SYLLABUS #1 (16-week course)
COURSE DESCRIPTION
To provide a basic understanding of the principles of purchasing food, beverage, equipment, contract
services, and supplies. Primary focus on product identification, supplier selection, and the ordering, receiving,
storing, and issuing process.
COURSE OBJECTIVES
To develop and/or refine the student's ability to:
1. Apply generally accepted principles and procedures of selection and procurement in the hospitality
industry;
2. Analyze specific product characteristics, especially their market distribution, quality standards, and
other selection factors; and
3. Prepare product specifications.
COURSE READER
The following textbook is used for this course:
Feinstein, Andrew Hale., and Stefanelli, John M. (2008). Purchasing: Selection and Procurement
for the Hospitality Industry, 7th ed. NJ: John Wiley & Sons, Inc.
COURSE OUTLINE
TOPIC
BACKGROUND READING
The Concepts of Selection and Procurement
Chapter 1
Technology Applications in Purchasing
Chapter 2
Distribution Systems
Chapter 3
EXAMINATION I
Forces Affecting the Distribution Systems
Chapter 4
An Overview of the Purchasing Function
Chapter 5
The Organization & Administration of Purchasing
Chapter 6
EXAMINATION II
The Buyer’s Relationships with Other Company
Chapter 7
Personnel
The Purchasing Specification: An Overall View
Chapter 8
EXAMINATION III
The Optimal Amount
Chapter 9
The Optimal Price
Chapter 10
EXAMINATION IV
The Optimal Payment Policy
Chapter 11
The Optimal Supplier
Chapter 12
EXAMINATION V
Typical Ordering Procedures
Chapter 13
Typical Receiving Procedures
Chapter 14
Typical Storage Management Procedures
Chapter 15
EXAMINATION VI
Security in the Purchasing Function
Chapter 16
Fresh Produce
Chapter 17
Processed Produce and other Grocery Items
Chapter 18
EXAMINATION VII
ix
Dairy Products
Eggs
Poultry
Fish
Meat
Beverages
Nonfood Expense Items
Services
Furniture, Fixtures, and Equipment
Chapter 19
Chapter 20
EXAMINATION VIII
Chapter 21
Chapter 22
EXAMINATION IX
Chapter 23
EXAMINATION X
Chapter 24
Chapter 25
EXAMINATION XI
Chapter 26
Chapter 27
EXAMINATION XII
COURSE PROCEDURE
The objective of this course, attainment of a basic understanding of the purchasing function within
the hospitality industry, will rely primarily on background reading, lecture and discussion sessions, field trips,
homework exercises, examinations, and a term project.
COURSE ASSIGNMENTS
1. Twelve non-cumulative examinations.
2. Class attendance.
3. Class participation.
4. Homework.
5. Term project. (See sample #1 in term projects section)
COURSE GRADE
Your final course grade will be determined as follows:
The total number of points earned for each examination, class attendance, class participation,
homework, and the term project will be divided by the maximum number of points that could have been
earned for these assignments. The percentage computed will be translated into a letter grade according to the
following scale:
A
=
96% to 100%
A=
92% to 95%
B+
=
89% to 91%
B
=
86% to 88%
B=
82% to 85%
C+
=
79% to 81%
C
=
76% to 78%
C=
72% to 75%
D+
=
69% to 71%
D
=
66% to 68%
D=
62% to 65%
F
=
0%
to 61%
(NOTE TO THE INSTRUCTOR: You will need to determine the point distribution you want to use
for the assignments and list it on this syllabus.)
x
SAMPLE SYLLABUS #2 (16-week course)
Course Number
(Suggested course title): Hospitality Purchasing
Semester, Year
OFFICE INFORMATION
Primary Instructor:
Office Number:
Office Hours:
Telephone:
Fax:
E-mail:
APPOINTMENTS
State the desired appointment procedures.
CLASS INFORMATION
Time and Location
REQUIRED TEXT
Feinstein, Andrew Hale., and Stefanelli, John M. (2008). Purchasing: Selection and Procurement
for the Hospitality Industry, 7th ed. NJ: John Wiley & Sons, Inc.
COURSE DESCRIPTION
This course is intended to promote an understanding of the managerial aspects of the hospitality
purchasing activity. Emphasis is placed on strategic selection and procurement considerations based on
item need, value, and supplier information. The purchasing targets are food, beverage, supplies,
equipment, services, and furnishings. Particular attention will also be given to product identification and
to the receiving, storing, and issuing sequence, as well as to the technological applications and concepts in
purchasing.
COURSE OBJECTIVES
This course is designed to develop or refine your:
1. knowledge of the generally accepted principles and procedures of selection and procurement and
their applications in the hospitality industry;
2. knowledge of how to determine the optimal amount, price, payment policy, and supplier for the
purchasing targets;
3. knowledge of technology applications buyers and suppliers use;
4. knowledge of specific product characteristics, especially their market distribution, grading
standards, quality differences, and other selection factors; and
5. ability to develop and document policies and procedures for controlling the purchasing function
in a hospitality operation.
CRITERIA FOR EVALUATION
Exams (3 @ 100 points each)
Final Exam
Purchasing Manual
300 points
100 Points
100 points
xi
EXAMS
See class schedule for exam dates. Exams are multiple choice and true/false format. Exams can
include mathematical problems or specifications. Students will need to bring a SCANTRON, calculator,
and a # 2 pencil to class on exam day.
FINAL EXAM
The final exam will be an eighty (80) question, multiple choice exam.
PURCHASING MANUAL
The description and the requirements of this assignment are described in detail in sample #2 of
suggested term projects section of this manual.
GRADING SCALE
Your course grade will be determined as follows:
A
=
92% to
100%
A=
89% to
91%
B+
=
85% to
88%
B
=
82% to
84%
B=
79% to
81%
C+
=
75% to
78%
C
=
72% to
74%
C=
69% to
71%
D+
=
65% to
68%
D
=
62% to
65%
D=
59% to
61%
F
=
0%
to
58%
CLASS ATTENDANCE
Include specific class attendance requirements here.
xii
DETAILED SCHEDULE
(Based on a 16 week semester with two class meetings per week)
Month
Date
Day
Topic
Introduction
Selection, Procurement, and Technology Applications
Distribution Systems
Forces Affecting the Distribution Systems
An Overview of the Purchasing Function
The Organization & Administration of Purchasing
The Buyer’s Relations with Other Company Personnel
Exam 1
The Purchase Specification: An Overall View
The Optimal Amount
The Optimal Price
The Optimal Payment Policy
The Optimal Supplier
Typical Ordering Procedures
Typical Receiving Procedures
Typical Storage Management Procedures
Security in the Purchasing Function
Exam 2
Fresh Produce
Processed Produce and Other Grocery Items
Dairy Products and Eggs
Poultry and Fish
Meat
Exam 3
Beverages
Nonfood Expense Items, Services, Furniture Fixtures &
Equipment
Final Review
Final
xiii
Chapters
Reviewed
1 and 2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19 and 20
21 and 22
23
24
25, 26, 27
ACADEMIC INTEGRITY
Students are forewarned that all opportunities for violations will be closely scrutinized and that
violators will be subject to appropriate sanctions. Per the University’s Undergraduate Catalog, the
University is dedicated to learning by all members of its community. In responding to this dedication, the
University demands a high level of scholarly behavior and academic honesty on the part of students,
faculty, staff, and administrators. No form of academic dishonesty is acceptable.
While maintenance of an atmosphere of academic integrity is the responsibility of all, the faculty
is principally responsible for enforcement of these principles. Academic dishonesty includes any act that
violates the academic process of the university. These acts include, but are not limited to, cheating on an
examination, stealing examination questions, substituting one person for another at an examination,
violating the procedures of a national or state examination, falsifying data, destroying or tampering with
or stealing a computer program or file, and, turning in the work of someone and claiming it as your own.
If you are caught with any of the above violations, you will receive an F in this class.
The instructor is responsible for recording the circumstances and for giving the student the
opportunity to reply. Appeals go to the dean of the college offering the course, the Academic Standards
Committee, and the Vice President for Academic Affairs. On the back of this syllabus is a sheet of paper
stating that you understand all parts of this academic integrity statement and are willing to abide by it.
You must sign this and return it to the instructor by the second day of class. Failure to sign this form will
result in being dropped from this class. Remember, ignorance of these rules is no excuse. If you do not
understand this section, please see the instructor.
ACADEMIC ACCOMMODATIONS FOR DISABLED STUDENTS
If you have any condition, such as a physical or learning disability, which will make it difficult
for you to carry out the work as outlined or which will require academic accommodations, please notify
the instructor immediately so that he/she may assist you. Students may also contact (provide name, phone
number, and location of related resource center) for coordination of their academic accommodations.
DIVERSITY STATEMENT
It has been and will continue to be the policy of (College or University name), to be an equal
opportunity institution. All decisions of admissions and employment are based on objective standards that
will further the goals of equal opportunity.
The university is committed to assuring that all programs and activities are readily accessible to all
eligible persons without regard to race, religion, gender, national origin, ancestry, age, disability,
Vietnam-Era and/or disabled veteran status, any protected class under relevant state and federal laws, and,
in accordance with the University policy, sexual orientation.
PROFESSIONALISM
Students are expected to demonstrate restraint and professionalism at all times. Failure to
demonstrate common courtesy and respect toward others will result in your removal from the class.
xiv
SAMPLE SYLLABUS #3 (16-week course)
Course Title and Number (Hospitality Purchasing)
Semester, Year
OFFICE INFORMATION:
Professor:
Office Phone:
Faculty Office is located in:
Internet e-mail:
Fax Number:
OFFICE HOURS: Will be scheduled on an individual basis.
CLASS INFORMATION:
Location and Time
(Course Number)Hospitality Purchasing
A reception for 325 executive guests is scheduled for Friday at 5 PM…
Which cheeses should be purchased? Pre-shredded? Or should we buy “convenience” appetizers?
Frozen? What Quality? How do we describe quality? What quantity? Delivered when? And should we
renew the carpet cleaning service? Or is it time to BUY our own cleaning equipment?
This class is about making decisions on questions such as those described above. This course
offers objectives, perspectives, and tools for executing and managing others in conducting purchasing
activities. Readings, class sessions, and exercises are intended to promote an understanding of both the
managerial and choice aspects of hospitality purchasing. Particular emphasis is on strategic selection and
procurement considerations. The course focus includes: products/service specifications, as well as
determinations of what, when, and from whom to buy, how much to buy, how much to pay, and
safeguarding what is purchased. Main purchasing targets includes food and beverage products,
equipment, furnishings, operating supplies, and services.
REQUIRED TEXT: Feinstein, Andrew Hale., and Stefanelli, John M. (2008). Purchasing: Selection
and Procurement for the Hospitality Industry, 7th ed. NJ: John Wiley & Sons, Inc.
COURSE OBJECTIVES:
1. The student will have an understanding of the process of purchasing food, beverage, equipment,
contract services and supplies, and will be able to differentiate between commercial and noncommercial
operations with 95% accuracy.
2. The student will in the course of the semester and through classroom handouts be able to calculate with
a 90% proficiency, the Levison, Par stock, economic Order Quantity Ordering systems.
3. The student will develop the skills to compute portions and preparations required for large numbers of
guests and will be provided with ample opportunity to practice these skills.
COURSE EXAMINATIONS:
There is the possibility of several quizzes and there will be five examinations (plus the final)
scheduled for the semester. The expected date for each exam is noted in the Course Calendar while
quizzes are unannounced.
The reason for such frequent evaluations is that they tend to stimulate students to keep up and
stay involved. Since this course should and does move rapidly, regular exams provide ongoing feedback.
Final Exam. A Comprehensive Final Exam is scheduled for (date, time, and place) in accord
with the published Finals Schedule.
xv
COURSE EVALUATION POINTS:
1. Quizzes: The first evaluation will be a 20 point quiz to allow for “orientation” (Note: All quiz
and exam scores will be converted to percentages indicating the percent of total possible points
earned. All other quizzes will be unannounced and may vary in point value depending on class
participation and attendance.
2. Exams: Will consist of material covered in class, from overheads, and assigned reading. They
will very in format and will be discussed in class prior to the first exam
3. Production Analysis Team Project: Groups of 3-4 students
4. Final Examination: Mandatory
POINT BREAKDOWN:
Preparation/Attendance
Quiz
Exams
Production Analysis Team Project
FINAL EXAMINATION
TOTAL POINTS
100 x 5=
# of points
50
20
500
100
100
770
GRADE DETERMINATION:
A
AB+
B
BC+
C
CD+
D
DF
92.0 % and above
90.0 through 91.9%
88.0 through 89.9%
82.0 through 87.9%
80.0 through 81.9%
78.0 through 79.9%
72.0 through 77.9%
70.0 through 71.9%
68.0 through 69.9%
62.0 through 67.9%
60.0 through 61.9%
falling below 60%
ACADEMIC INTEGRITY
Appropriate conduct for a University setting is outlined in the Undergraduate Catalog. All
university community members (student, faculty, and staff) are expected to practice exemplary scholarly
behavior and academic honesty. It is each member’s role to uphold and to police these ideals. This means
that students, not just faculty, are obligated to prevent and report instances of dishonesty or misconduct to
the course instructor or to an appropriate administrator.
STUDENT ACCOMMODATION
The Student Support Services are available for those who may benefit from assistance in seeing,
hearing, reading, and test-taking, etc. If you have a documented disability that may require assistance, you
will need to contact the Disability Resource Center (DRC).
xvi
SUGGESTED COURSE CALENDAR:
WEEK
Topic
1
Course Orientation
Purchasing Intro
Pre-test
Ch.1: The Concepts of Selection & Procurement
Ch.2: Technology Applications in Purchasing
2
Ch.3: Distribution Systems
Ch.4: Forces Affecting the Distribution Systems
3
Ch.5: The Overview of the Purchasing Function
Review for EXAM 1
EXAM 1 CHAPTERS 1-5
4
Return Exam 1
Ch.6: The Organization & Administration of Purchasing
Ch.7: The Buyer’s Relationships with Other Company Personnel
Ch.8: The Purchasing Specification: An Overall View
5
Ch.8: The Purchasing Specification, continued
Ch.9: The Optimal Amount
Ch.10: The Optimal Price
Review for EXAM 2
6
EXAM 2 CHAPTERS 6-10
7
Return Exam 2
Ch.11: The Optimal Payment Policy
Ch.12: The Optimal Supplier
Ch.13: Typical Ordering Procedures
8
Ch.14: Typical Receiving Procedures
Ch.15: Typical Storage Management Procedures
Review for EXAM 3
EXAM 3 CHAPTERS 11-15
9
Return Exam 3
Ch.16: Security in the Purchasing Function
Ch.17: Fresh Produce
10
Ch.18: Processed Produce and Other Grocery Items
Ch.19: Dairy Products
11
Ch.20: Eggs
Review for EXAM 4
EXAM 4 CHAPTERS 15-20
12
Return Exam 4
Ch.21: Poultry
Ch.22: Fish
Ch.23: Meat (Beef, veal, pork, lamb)
13
Ch.24: Beverages
Ch.25: Nonfood Expense Items
Ch.26: Services
14
Ch.27: Furniture, Fixtures, and Equipment
15
EXAM FIVE CHAPTERS 21-27
Class Presentations
Class Presentations
Return Exam 5
16
FINAL EXAMINATION
xvii
SUGGESTED TERM PROJECTS
SAMPLE TERM PROJECT #1
PURCHASE SPECIFICATIONS
The purpose of the term project is twofold. One, the student will become very familiar with twentyfour food and beverage ingredients. And two, he or she will develop the ability to prepare an acceptable
product specification.
Each student is assigned twenty-four ingredients – three ingredients from each of the eight food and
beverage categories noted in this section of the instructor's manual. It is suggested that you make a random
assignment of these ingredients so that each student has a unique set.
You should make the assignment immediately following EXAMINATION VI (see syllabus sample
#1). When introducing the term project, note the following:
1. The students' first step should be to get familiar with the assigned ingredient lists.
2. Following the familiarization process, each student should note appropriate exact names and
intended uses for their ingredients. These data will influence the amount and type of remaining
information needed on each product specification.
3. Inform the students that you will highlight in class all relevant product selection factors for each
ingredient category.
4. Students should plan to use the product specification outlines noted in the textbook for each product
category to guide their work. Also point out that there are several example product specifications in
the textbook that can also be used as guidelines.
5. Ideally students should not wait until the last minute to work on their term projects. They will learn
more by spreading the work over the last few weeks of the course. For instance, a good strategy is for
students to work on fresh produce specifications immediately following the fresh-produce lesson(s)
in class, work on groceries immediately following the groceries lesson(s), and so forth.
6. Students usually need to spend about twenty to thirty hours on their term projects.
7. In many cases, it is more convenient for students to visit a supermarket, distributor warehouse,
buyer’s club (such as Sam’s Club) or hospitality operation's storeroom to gather relevant product
specification information.
8. The term project's completion date should be listed on the syllabus. In lieu of a single completion
date, you might want to stagger the project so that students are required to hand in a few
specifications at a time. This will keep them involved and prevent procrastination.
xviii
FOOD AND BEVERAGE CATEGORY I – FRESH PRODUCE
1. Fig
2. Apple
3. Apricot
4. Artichoke
5. Asparagus
6. Banana
7. Snap bean
8. Green bean
9. Egg plant
10. Parsley
11. Brussels sprout
12. Onion
13. Cabbage
14. Blueberry
15. Raspberry
16. Broccoli
17. Cantaloupe
18. Carrot
19. Celery
20. Cauliflower
21. Cherry
22. Coconut
23. Cucumber
24. Endive
25. Corn
26. Garlic
27. Grapefruit
28. Avocado
29. Grape
30. Leek
31. Lemon
32. Lime
33. Lettuce
34. Turnip
35. Mushroom
36. Nectarine
37. Squash
38. Orange
39. Peach
40. Papaya
41. Pear
42. Pepper
43. Potato
44. Pineapple
45. Plum
46. Radish
47. Spinach
48. Yam
49. Tomato
50. Kiwi
FOOD AND BEVERAGE CATEGORY II – GROCERIES
1. Green bean
2. Almond paste
3. Apple butter
4. Apple sauce
5. Pea
6. Baking powder
7. Baking soda
8. Lima bean
9. Oregano
10. Tomato
11. Instant potato
12. Soup base
13. Bread
14. Barley
15. Caper
16. Catsup
17. Mustard
18. Rice
19. Corn starch
20. Chili sauce
21. Chocolate syrup
22. Tapioca
23. Corn
24. Cumin
25. Oil
26. Mayonnaise
27. Salad dressing
28. Shortening
29. Vanilla
30. Honey
31. Jam
32. Jelly
33. Preserves
34. Soup
xix
35. Pie filling
36. Lentil
37. Nut
38. Noodle
39. Olive
40. Basil
41. Curry
42. Salt
43. Pepper
44. Cherry
45. Peach
46. Raisin
47. Fruit cocktail
48. Pear
49. Horseradish
50. Cinnamon
FOOD AND BEVERAGE CATEGORY III – DAIRY AND EGGS
1. Bleu cheese
2. Fresh egg
3. Egg yolk
4. Egg white
5. Dried egg
6. Fresh whole milk
7. Evaporated milk
8. Dried milk
9. Sour cream
10. String cheese
11. Dried meringue powder
12. Canned whole milk
13. Skim milk
14. Two-percent milk
15. Buttermilk
16. Nonfat milk
17. Yogurt
18. Chocolate milk
19. Half-and-half
20. Cream
21. Whipping cream
22. Eggnog
23. Dessert topping
24. American cheese
25. Lite cheese
26. Brick cheese
27. Brie cheese
28. Camembert cheese
29. Cheddar cheese
30. Colby cheese
31. Cottage cheese
32. Cream cheese
33. Edam cheese
34. Gorgonzola cheese
35. Gouda cheese
36. Cheese food
37. Cheese spread
38. Ice cream
39. Ice milk
40. Sherbet
41. Soft ice cream mix
42. Butter
43. Swiss cheese
44. Coffee whitener
45. Ricotta cheese
46. Mozzarella cheese
47. Fontina cheese
48. Parmesan cheese
49. Romano cheese
50. Liederkranz cheese
FOOD AND BEVERAGE CATEGORY IV – POULTRY
1. Chicken giblet
2. Cornish hen
3. Broiler/fryer
4. Chicken noodle soup
5. Turkey noodle soup
6. Chicken soup base
7. Chicken pot pie
8. Chicken liver
9. Capon
10. Chicken finger
11. Tom turkey
12. Duckling
13. Chicken Kiev
14. Duck
15. Goose
16. Chicken drummette
17. Squab
18. Pigeon
19. Chicken wing
20. Chicken thigh
21. Chicken leg
22. Chicken Cordon Bleu
23. Chicken chow mien
24. Chicken nugget
25. Chicken hot dog
26. Turkey hot dog
27. Turkey ham
28. Turkey bologna
29. Turkey cotto salami
30. Chicken hen
31. Turkey hen
32. Turkey breast
33. Chicken breast
34. Turkey thigh
xx
35. Turkey roll
36. Chicken lunch meat
37. Sliced turkey breast
38. Chicken patty
39.Chicken vegetable soup
40. Chicken neck
41. Turkey pot pie
42. Chicken burger
43. Chicken rice soup
44. Turkey rice soup
45. Cooked chicken meat
46. Chicken heart
47. Turkey soup base
48. Egg roll
49. Turkey pastrami
50. Chicken salad
FOOD AND BEVERAGE CATEGORY V – FISH
1. Trout
2. Frog leg
3. Catfish
4. Perch
5. Pike
6. Bass
7. Oyster
8. Whitefish
9. Abalone
10. Herring
11. Sturgeon
12. Cod
13. Fish stick
14. Fish patty
15. Dover sole
16. Haddock
17. Sole filet
18. Halibut
19. Mackerel
20. Pompano
21. Red snapper
22. Salmon
23. Squid
24. Swordfish
25. Tuna
26. Whiting
27. Clam
28. Crab
29. Crayfish
30. Lobster
31. Scallop
32. Shrimp
33. Mussel
34. Snail
35. Anchovy
36. Sardine
37. Smelt
38. Turbot
39. Shark
40. Caviar
41. Hake
42. Seafood Creole
43. Imitation crab meat
44. Flounder
45. Imitation shrimp
46. Chub
47. Clam juice
48. Fish cake
49. Sablefish
50. Monk fish
FOOD AND BEVERAGE CATEGORY VI – MEAT
1. Cubed steak
2. Round steak
3. Tamale
4. Flank steak
5. Hot dog
6. Sausage
7. Salami
8. Ham
9. Veal cutlet
10. Beef noodle soup
11. T-bone steak
12. Stuffed pepper
13. Beef for stewing
14. Rib eye roll
15. Beef inside round
16. Beef bone
17. Stuffed cabbage roll
18. Steer liver
19. Beef outside round
20. Chili
21. Leg of lamb
22. Pork chop
23. Veal chop
24. Skirt steak
25. Pork tenderloin
26. Pork cutlet
27. Ground beef
28. Meat ravioli
29. Beef tenderloin
30. Strip loin steak
31. Sirloin butt
32. Bacon
33. Bologna
34. Beef tongue
xxi
35. Porterhouse steak
36. Beef stew
37. Beef pot pie
38. Ground beef patty
39. Kidney
40. Chuck
41. Pork shoulder
42. Pork cutlet
43. Calf liver
44. Sparerib
45. Beef soup base
46. Lamb chop
47. Brisket of beef
48. Corned beef
49. Cocktail franks
50. Beef hash
FOOD AND BEVERAGE CATEGORY VII – ALCOHOLIC BEVERAGES
1. Rose wine
2. Cognac
3. Green Chartreuse
4. Peach liqueur
5. Triple sec
6. Blackberry brandy
7. Peach brandy
8. Apricot brandy
9. Anisette
10. Cherry liqueur
11. Crème de menthe
12. Beer
13. Malt liquor
14. Armagnac
15. Champagne
16. Scotch
17. Irish whiskey
18. Rum
19. Kailua
20. Peppermint schnapps
21. Sherry wine
22. Sloe gin
23. Bourbon
24. Crème de cassis
25. Passover wine
26. Canadian whisky
27. Tequila
28. Apple brandy
29. Chablis wine
30. Gin
31. Vodka
32. Chianti wine
33. Sauternes wine
34. Cointreau
35. Rhine wine
36. Ale
37. Light beer
38. Stout
39. Zinfandel wine
40. Riesling wine
41. Chardonnay wine
42. Chenin Blanc wine
43. Merlot wine
44. Ouzo
45. Vermouth
46. Madeira wine
47. Amaretto
48. Rye whisky
49. Drambuie
50. Pouilly-Fuisse wine
FOOD AND BEVERAGE CATEGORY VIII – NONALCOHOLIC BEVERAGES
1. Coffee
2. Diet soda
3. Instant coffee
4. Decaf. coffee
5. Papaya juice
6. Seltzer
7. Tea
8. Cocoa
9. Apple juice
10. Orange juice
11. Pear nectar
12. Lime juice
13. Orange drink
14. Cranapple juice
15. Grape drink
16. Lemonade
17. Pineapple juice
18. V-8 juice
19. Margarita mix
20. Grenadine
21. Root beer
22. Fruit punch
23. Cream soda
24. Apple cider
25. Tonic
26. Cola
27. Dr. Pepper
28. 7-UP
29. Bottled water
30. Club soda
31. Tea
32. Prune juice
33. Mango juice
34. Apricot nectar
xxii
35. Peach nectar
36. Lemon juice
37. Plum nectar
38. Cranberry juice
39. Grape juice
40. Grapefruit juice
41. Pink lemonade
42. Tomato juice
43. Bloody Mary mix
44. Espresso coffee
45. Boysenberry juice
46. Iced tea mix
47. Lemon/lime soda
48. Chocolate drink
49. Ginger ale
50. Strawberry soda
SAMPLE SEMESTER PROJECT #2
PURCHASING MANUAL
Due Date: (State the due date and related information here).
Objectives
At the completion of the assignment, students will be able to satisfactorily demonstrate their
ability to:
1. Establish a purchasing system for purchasing food for a hospitality operation;
2. Establish policies and procedures for ordering, receiving, storage, inventory control and issuing
of food for a hospitality operation; and
3. Develop appropriate specifications, forms, and records for effective purchasing practices for a
hospitality operation.
The Assignment
Students are required to prepare a research paper for this course. The student will assume the
position of a manager or owner of a real or imaginary restaurant, or some other foodservice operation.
The paper will be written in the style of a Purchasing Manual instructing a newly hired Purchasing Agent
in carrying out the policies and procedures for ordering, receiving, storage, inventory control, and issuing
of food for this hospitality operation.
Purchasing Manual Evaluation
The paper will be graded according to the following criteria:
Category
Points
Format
25
Content
50
Presentation
25
TOTAL
100
The following is an explanation of the evaluation criteria. Also, see the Purchasing Manual
Evaluation Sheet that is attached to this document.
Format (25 points)
TABLE OF CONTENTS (5 Points)
Following a title page, a Table of Contents will identify the page where each major section and
subsection of the manual begins. Points will be deducted if no page numbers are given.
INTRODUCTION (10 Points)
An introduction, welcoming the newly hired Purchasing Agent, will provide pertinent
information about the real or imaginary foodservice operation, including: a brief history, type of menu,
location of the establishment, seating capacity, hours of business, and any feature that makes the
operation unique.
NOTES (5 Points)
Students may use the words and ideas of other persons as long as they give appropriate credit by
footnoting the passage. Sources may be documented using one of the following three methods:
1. Parenthetical notes within the text of the manual (internal citation);
2. Endnotes, at the conclusion of the manual; or
3. Footnotes, at the bottom of the page.
xxiii
Students are expected to conduct their own research. Handing in the work of a fellow student,
past or present, will result in a failing grade for the course. It is not necessary to footnote specifications.
BIBLIOGRAPHY (5 Points)
Students are required to seek out and investigate sources of information along with their own
personal knowledge and experience. A bibliography providing a list of all books and articles used in the
preparation of the manual should be presented at the end of the manual. Bibliographic entries must be
arranged in alphabetical order by the author's last name.
The bibliography should list five or more sources. An interview with a foodservice professional
may be listed. Class notes may also be listed.
Content (50 Points)
The body of the paper will consist of a separate section for each of the following:
1. Ordering
2. Receiving
3. Storage
4. Inventory Control and Issuing
Each section (10 Points each) will begin on a new page, and will instruct the Purchasing Agent on
how to carry out the purchasing function at the particular operation. There should be evidence of research
in each section.
The manual will also include a section consisting of ten specifications (10 Points). Regardless of
the type of operation and the type of menu, specifications will include at least one of each of the
following: fresh produce, processed produce, dairy, eggs, poultry, fish, meat, alcoholic beverage, service,
and FF&E.
Presentation (25 points)
SPELLING AND GRAMMAR (10 Points)
The manual must be professional in terms of language use, spelling, grammar, and punctuation.
INSTRUCTIONAL FORM (5 Points)
The manual will instruct the Purchasing Agent in carrying out his or her duties and
responsibilities. Therefore, the text must read like an instructional manual.
PROFESSIONAL QUALITY (10 Points)
The manual must be a clean, neat, attractive document, and must be professional in terms of style
and presentation. Students should feel free to adapt class materials in the preparation of their manual.
Handouts and copies of published material, however, should not be included in the manual.
If a student is producing a manual that will be used in an actual operation, some of the above
requirements may be waived. Consult with your instructor about your plans.
xxiv
FOOD AND BEVERAGE CONTROLS
PURCHASING MANUAL EVALUATION
Name____________________________________________________
Date ________________20_______
GRADE_________________
Points
Possible
Evaluation Criteria
FORMAT
Table of Contents
Points
Awarded
Comments
5
Introduction
10
Footnotes
5
Bibliography
5
SUBTOTAL
25
CONTENT
Ordering
10
Receiving
10
Storage
10
Inventory Control and Issuing
10
Specifications (10+)
10
SUBTOTAL
50
PRESENTATION
Spelling and Grammar
10
Instructional Form
5
Professional Quality
10
SUBTOTAL
25
TOTAL SCORE
100
Comments:____________________________________________________________________
______________________________________________________________________________
_____________________________________
xxv
SAMPLE SEMESTER PROJECT #3
GROUP PROJECT CONVENIENCE PRODUCT ANALYSIS
CONVENIENCE PRODUCT SPECIFIC CATEGORY
Recommendation:
As a group, read, think, and talk through this entire project BEFORE beginning. What types of
product’s are of interest? Reasonable to locate? Etc. Answers to the questions included in the project
assignment probably would not be less than 1 to 2 typed pages per question, plus the graphics. Be sure to
clearly identify the individual products referenced.
1. Briefly name and describe your (fictitious) catering company and a catering event at which a
convenience food item (see #3 below) will be served. (It need not be the main course). Be
sufficiently thorough in your descriptions so that your eventual product choice makes sense. You
might note how/where the food will be thermalized (heated, cooled) and plated. What serviceware will be used? Who will be the guests? Number? At what event? A wedding party of 200
older persons? A day care picnic for 25 3-yr olds? On a scale of 1 (bare bones) to 5 (lavish),
what is their budget?
2. For the purposes of eventually selecting a product for the above event, report and rank, highest to
lowest. The guests' priority objectives and the caterer's priority objectives: Brand recognition?
Eye appeal? Flavor? Low price/value? Large portions? Festive? Low fat? Preparation ease? Other
objectives? Choose a convenience food item to be served by the team's firm at the noted event
(e.g., vegetarian lasagna, chicken chow mein, premium ice cream, etc.) Observe these criteria:
A. Three different brand examples of this item must be available, at least one of which
corresponds with the priorities in #2, of the above. For example, the team might study three
competing brands of frozen lasagna; or instead, two brands of frozen apple pie and one brand
of fresh bakery apple pie.
B. Each item/product must be packaged in packaging that includes both an ingredient label and
a nutrition label and/or key decision criteria and data. Note: IF the group will need any
equipment for this presentation other than an overhead projector, the instructor should be
notified AT LEAST one class period in advance in order to schedule equipment delivery
(e.g., easel, slide projector, computer projection system, etc.).
Project Objectives:
1. Since we learn from one another as well as from our own activities, this provides a forum for
sharing ideas, discoveries, research approaches, as well as presentation touches and techniques.
2. It provides an opportunity for one or more team members to practice (and impress others with
his/her verbal presentation skills in front of a group of colleagues.
3. A little known gem is that an important part of being a Hotel Major should be getting to know
others: networking for tomorrow. Presentations provide a way to observe how at least a few of
your colleagues handle this important aspect of business--public speaking. Note the names of
those individuals who impress you favorably. Maybe you'll want to recruit them for your business
one day - or contact them to go to work in their department or company!
Project Procedures:
1. Each selected product has three or more "food" ingredients. EXCLUDED in this count are
water and all non-food additives (e.g., nutrients, preservatives, texturizers, colorants, and others
that are included primarily for economic purposes.) Herbs and spices DO count as food.
xxvi
2. Visit any (one or more) foodservice vendor, club store, supermarket, food importer, or other
specialty food retailer to locate three brands to compare. For each of the three products, record all
the information required to complete the accompanying table. (Tip: Note any differences.) The
group is not required to purchase the three items. However, for ease of analysis, it definitely is
recommended that the group choose an item of interest, and then purchase the examples.
3. Now, create a typed spreadsheet or table for (at least) the information requested. Your graphic
should contain the actual data from your selected products, as well as the results of the necessary
computations. Each group is welcome - is encouraged- to arrange the information (rows) in a
different order, or to devise an entirely different scheme for presenting the comparison. The
objective is a smooth, sensible, and complete communication of the comparison that helps the
reader of the table or other graphic interpret which is the optimal item to select, given item
number 2's stated objectives.
4. Prepare a separate table or chart to present a per product comparison of the entire table's data that
refers to A.P. price (at least three instances). Devise the meaningful graphic arrangement of your
choice. Interpret and comment on the price results shown in your graphic with accompanying
text.
5. Describe main relevant differences found across these products, aside from A.P. price.
6. According to #1 and #2 above, which of the three products the team analyzed would be selected
for the event? WHY? Second choice? Why? Would the third-ranked product be acceptable in the
absence of the others? Why or why not?
Product Presentation:
Each group is to have one or more members present a brief summary of the three-product
comparison to the class. Presentations should be planned to take approximately 3-5 minutes (excluding
class questions). Share with the class a quick overview of the fictional catering firm, the event, and the
prioritized objectives of the firm and the customers. Then review the comparison of relevant
characteristics of the three products examined, bringing us to the team's conclusion of which would be
selected and why.
Props and other visuals are recommended because they can communicate a great deal in a short
time. (A picture CAN BE worth a thousand words.) Example visuals are the products, their packages, and
overhead transparencies of the group's charts.
A final formal paper will be given to the instructor for evaluation.
xxvii
Group Project Evaluation Sheet
Convenience Product Analysis
Possible maximum of 10 Points each
1. Completeness of the product evaluation
2. Product selection process
3. Degree of participation by group members
Group Presentation
1. Quality of presentation: visual aids and or handouts
2. Presentation delivery communication quality
3. How well did the group meet the goals of the project?
Project paper
1. Quality of preparation and professionalism of paper
2. Degree that the facts and figures of the products meet the final analysis of the group
decision making process
Overall Grade combining all of the requirements of the project including your degree of
participation
Total Points
xxviii
__________________
Chapter 1: The Concepts of Selection and Procurement
Key Concepts
1. Types of hospitality operations
a. Commercial operations
b. Noncommercial operations
i. Institutional operations
ii. Military operations
2. Major purchasing distinctions in hospitality operation types
a. The independent operation
b. The multiunit operation
c. The franchise operation
3. Purposes of the textbook
1
Multiple Choice Questions
1. An advantage of co-op purchasing is:
a. buyers will receive a higher quality
b. there is potential cost savings due to bulk purchasing
c. suppliers prefer this system over all other purchasing methods
d. all of the above
2. E-procurement applications are:
a. direct-mail applications focusing on procurement activities
b. e-commerce applications that focus on broad-band activities
c. computer applications that focus on e-commerce activities
d. e-commerce applications that focus on procurement activities
3. The orderly, systematic exchange between seller and buyer is referred to as:
a. selection
b. procurement
c. purchasing
d. identification
4. Typically, franchise operations can reduce and streamline the purchasing function by:
a. using a co-op organization to increase their buying power
b. using a central distribution center
c. buying large quantities of locally produced products
d. restricting franchises from purchasing products locally
5. The hospitality industry includes three major segments -- the commercial segment, institutional
segment, and:
a. military segment
b. lodging segment
c. religious segment
d. off-premises segment
6. Franchise operations usually purchase some products from local suppliers primarily because:
a. it will save a great deal of money
b. state law usually requires purchasing agents to buy many items locally
c. local suppliers usually sell higher quality merchandise
d. it can maintain good community relations
7. Which one of the following is an example of a noncommercial hospitality operation?
a. quick service restaurant
b. bar
c. convenience store with foodservice
d. none of the above
2
8. E-commerce platforms where products can be selected and procured online are referred to as:
a. e-procurement centers
b. e-procurement chat-boards
c. e-marketplaces
d. e-buying clubs
9. Which one of the following is not considered to be a responsibility of a small independent ownermanager?
a. advising the board of directors of potential new products
b. overseeing delivery of inventory from distributors
c. preparing payroll checks
d. all of the above
10. The manager of a company-owned restaurant unit usually orders all merchandise from the
company's central commissary or from:
a. an approved supplier
b. the local supermarket supplier
c. the co-op set up by the vice president of purchasing
d. none of the above
11. The vice president of purchasing for a large corporation has the responsibility for all of the
following except:
a. drafting national contracts
b. establishing purchase specifications
c. purchasing products for independently owned and managed operations
d. establishing limitations for purchasing products
True/False Questions
1. In the context of e-procurement, the term "B2B e-commerce" stands for business-to-buyer
electronic commerce.
2. It is very profitable for noncommercial hospitality operations to engage in co-op purchasing;
however, it is not very profitable for the commercial operations.
3. It is very profitable for commercial hospitality operations to engage in co-op purchasing;
however, it is not very profitable for the noncommercial operations.
4. It is illegal for noncommercial operations, such as school foodservices, to engage in co-op
purchasing.
5. It is illegal for government-operated foodservice facilities to engage in co-op purchasing.
6. A correctional facility is part of the commercial and military segment of the hospitality industry.
7. A cruise ship is an example of a noncommercial type of foodservice operation.
8. The small independent foodservice operations usually have limited capital resources to take
advantage of volume discounts that may be offered by a supplier.
3
9. The executive steward's major job responsibilities are to order food and supervise the kitchen
ware-washing crews.
10. A franchise operation should never purchase products from any vendor outside of the central
distribution center.
11. A small, independent foodservice operation is usually run by an owner-operator who does all of
the buying for the operation.
12. An Internet purchasing program can be accessed only by hospitality operators that are licensed to
engage in e-commerce.
13. Many hospitality businesses now use Internet-based e-procurement applications.
14. The evolution of the Internet and the introduction of e-commerce technology have leveled the
playing field for smaller hospitality companies to procure products at more competitive prices.
15. In a large hospitality company, the restaurant manager is responsible for drawing up national
contracts.
16. A lodging referral group may provide some central purchasing services to its members.
17. A mobile caterer is an example of a commercial type of foodservice operation.
18. The second major category of hospitality operations includes the multi-unit companies and
franchises.
19. A small, independent restaurant/bar is usually run by an owner-operator who does all or most of
the buying for the operation.
20. Purchasing from a commissary is always less expensive than buying foods from local suppliers.
21. The commissary system used by large chain operations is always the most cost effective option.
22. A "referral group" is another name for a "B2B group."
23. Selection is defined as paying for an item or service.
24. The foodservice at UNLV's Dining Commons is an example of a commercial foodservice
operation.
25. Waste and spoilage are not factors that small nonprofit foodservice operations need to worry
about.
4
Answer Key for Chapter 1
17.
18.
19.
20.
21.
22.
23.
24.
25.
Multiple Choice:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
b
d
b
b
a
d
d
c
a
a
c
True/False:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
False
False
False
False
False
False
False
True
True
False
True
False
True
True
False
True
5
True
True
True
False
False
False
False
False
False
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Answers to Questions in the Textbook:
1. Selection is choosing from among various alternatives on various levels.
2. Procurement is an orderly systematic exchange between seller and buyer.
3. The broad view allows for those who are not going to be specialized purchasing agents to
understand the purchasing function as it relates to the hospitality industry. It also helps them
understand how purchasing interacts with other departments in the typical hospitality company.
4. E-procurement applications are computer applications, which harness the power of the Internet to
complete Business to Business e-commerce (B2B).
5. The hospitality industry can be broken up into major segments, which are Commercial and
Noncommercial. These two segments are broken down into Profit-Oriented Operations for
commercial, and Institutional and Military for noncommercial. The main difference between
these segments is the profit-orientation of the commercial businesses.
6. Small independents generally have a manager/owner responsible for all purchasing decisions,
while the large properties usually would have a full time buyer purchasing for the various
production departments, or have a full time buyer in each of its many departments.
7. Co-op buying is when a group of hospitality operations band together to achieve savings through
bulk buying.
8. E-commerce has created aggregate purchasing companies that assist in the purchasing function
for similar hospitality organizations throughout the country, by negotiating contracts on behalf of
restaurants, hotels, etc. It allows buyers to search quickly for products and services. And it
simplifies the procedures as well.
9. Many of these corporations require the individual units to purchase items from a central
distribution center/commissary. For items that cannot be purchased this way, they must be
purchased locally; in this case, the buyers must adhere to standardized company specifications
and purchasing procedures.
10. This question is similar to number 9. The difference is that the student may wish to focus a little
more on the commissary production. Also, unlike question 9, question 10 does not indicate that
there are two typical purchasing procedures.
11. Some reasons are: maintain good relations in the community; purchasing highly perishable
products; it may be more convenient; sometimes local suppliers have lower prices; it may save
time.
12. The student could indicate any three of the following main activities:
a) Draw up national contracts
b) Establish purchase specifications
c) Set general purchasing policy
d) Purchase stock for central commissary/distribution center
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13. Some acceptable answers would be:
a) Prices would be lower
b) A co-op may have easier access to hard-to-obtain items.
c) Convenience
d) A co-op may have a skilled buyer who will share ideas with its members
e) Shipping costs can be shared
f) Purchasing the same item for many different units in a chain can increase savings
14. This question is similar to question 13. Similar answers would be acceptable.
15. Paying for a product or service.
16. A virtual marketplace on the Internet where suppliers can sell their wares to a variety of
hospitality operations.
17. A type of co-op where independent operators join together in order to send business to each other.
18. E-commerce allows companies to do things electronically, which frees time formerly used to
telephone orders to distribution centers, in addition to having to search for the best price through
stacks of paper price sheets. It also allows buyers to view many types and varieties of products
quickly and efficiently.
19. There would be several acceptable answers. Essentially, e-commerce has streamlined the
purchasing process, making it more efficient and effective.
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