Restaurants and their purchasing function in 2025, the case of Shanghai
By Christine Demen Meier, Associate Professor of Entrepreneurship at EHL
The Food & Beverage Industry conducted a prospective study.
This study has been done in 5 steps:
- A macro-environment analysis
- An academic literature review
- Interviews of experts and professionals
- A survey addressed to professionals about their vision of the future
- The development of prospective scenarios
The future of restaurants and their purchasing function
Two main scenarios emerged from survey analysis: one with a traditional purchaser and
A basic and traditional purchaser
In this scenario, there will be a "soft landing" of the Chineseeconomy. The remaining pressures (urbanisation, ageing of the population and inflation of food prices) will favour an increase in the efficiency of the market
In this context, the restaurant purchaser does not need to be astrategic thinker: he mostly needs to ensure food procurement and to adapt food quantities to customer demand and budgets. This implies a low degree of definition of the need or of anticipation of the demand. On the other hand, negotiation and reactivity are constantly needed. The purchaser's activities and relationship with suppliers remain simple, based on routines and mainly informal. As he mainly executes tasks, he does not have defined processes for his purchases or to communicate and potentially collaborate with his suppliers.
A strategic purchasing manager
This scenario would be particularly appropriate in case of a remaining sustained growthin China and of an improvement of infrastructures. The evolution of the legislation for safety and nutrition encourages improvements of the F&B operations, and both consumers and producers comply with this evolution.
Purchasers have followed this trend, getting more expertise in these topics anddomains. There has also been progress in food transportation, food storage and food traceability thanks to new IT and technological solutions. Adopting a more strategic and professional behaviour, purchasers implement processes and take initiatives for new products development and for the improvement of collaborations with suppliers, with or without contracts. For the majority of restaurant chains, technology has improved the ordering of purchases, the monitoring of the suppliers' market and product traceability. Devices which help manage the relationships between suppliers, restaurant managers, purchasers and kitchen chefs are all the more used that they include decision support software oriented specifically towards restaurant management. Financial management of the purchases is a priority for the purchaser and he is skilled enough to use any tool which may help him in this task (software, monitoring tools, dashboards…).
Additional scenario: State regulation
Academics, people working in institutions and business managers stated thatthe Chinese government has the power to modify situations with unexpected intensity and strength (compared to Western countries), especially when there are issues which threaten the social stability of the country. In that perspective, this scenario postulates a complete control of food safety and traceability by governmental agencies.
Purchaser, as a technician, would be able to understand, apply andanticipate legal norms and evolutions. At the same time he would have to find and use the most adapted means to do so. IT tools would be mobilised to reach the highest food safety standards possible, and the purchaser would have to be proactive both in the restaurant and with external partners. As a consequence, a concentration of the supplier market would also occur and the purchaser would have to increase the development of new products with wholesalers and group purchasing organisations, which would be associated with him in mid- or long-term relationships. Within these strategic supply chains, sanitary, nutritional and even ecological aspects would be strongly improved.
N.B: on July 4 during I-CHLAR conference, a day will be dedicated to the F&B industry. Register on: http://ichlar.ehl.edu/programme
About The Food & Beverage Industry Research Chair
The Food & Beverage Industry Research Chair was founded in 2010 by Ecolehôtelière de Lausanne and is supported by Danone Professional, Nestlé Professional and Unilever Food Solutions.
Its objectives are:
- To contribute to the development of innovative trends for operators, suppliers, distribution channels, sellers and marketers.
- To enhance students' and professors' understanding of the industry.
- The Chair's observation post for current and prospective jobs in the catering industry aims to:
- Develop a better understanding of F&B jobs: operators, suppliers, distribution channels, sellers, marketers, etc.
- Provide a framework for job identification and employment trends that includes different methodologies and agree on a common working language.
- Analyze the impact of technological or organizational advances on the skills required for F&B jobs.
About Ecole hôtelière de Lausanne (EHL)
Ecole hôtelière de Lausanne (EHL) is an ambassador for traditional Swiss hospitality and has been a pioneer in hospitality education since 1893. It has created and inspired a unique professional community of over 25,000 hospitality managers, united by the values and the legacy of EHL. EHL is a leading university that provides learning solutions for enthusiastic, talented and ambitious students from 114 different countries. With undergraduate, graduate and certificate programs, EHL offers its students a range of on-campus and online education opportunities at different stages of their professional journey. EHL is regularly recognized as the best hotel management school in the world with the highest graduate employment rates in the industry. EHL is a member of EHL Holding SA, a Group dedicated to hospitality management education