Why better procurement could be the answer to your problems

In the face of inflation, supply chain disruptions and evolving consumer expectations, procurement within the hospitality sector is undergoing significant changes. Its traditional view—as merely a function of operations—is being challenged, with experts stressing that procurement practices need to form a core part of companies’ long-term strategies. 

“Typically, investors see procurement as a very valuable function when times are tough and margins are being squeezed, and it gets a lot of attention and focus. But when cost pressures aren’t quite as bad, where procurement is saving money isn’t considered quite as much, and so it becomes more of a cost perhaps than a saving,” said Phil Halanen, head of sourcing & sustainability, EMEA at Wyndham.  

However, he notes that procurement is evolving from being just a cost center, with companies starting to realize the value of procurement as a profit center as the function can also be used to generate revenue whether that be through sales commissions from suppliers selling into company networks or collaboration when it comes to marketing initiatives. 

Read the full article on our sister site, Hospitality Investor.