GPO Benefits That No One Tells You About

The event industry was hit hard by the COVID-19 pandemic, causing businesses across the board to look for ways to reduce costs. With an unstable economy, it’s vital to find additional strategies to bring in revenue and raise profit margins. However, even as events have made a comeback, caterers should still be mindful about spending.

One of the most effective ways to do so is by joining a group purchasing organization (GPO) for caterers. A GPO is similar to a mutual fund, but rather than stocks and bonds, caterers join together to buy food supplies. Forming a large group allows businesses to increase their buying power and get better prices due to the high volume of products they purchase.

Bulk orders tend to come at a lower cost than small orders, but you might not need to buy all of your ingredients in bulk if you're a smaller catering company. With a GPO, you can place orders at a discounted rate while only paying for what you need. Though you’re not getting any money back as you would with a rebate program, you will be saving money upfront with each order.

Joining a GPO is a great cost-saving strategy, and there are a variety of benefits when it comes to finding the right GPO for your business. Here’s what you need to know. 

Reduces heavy lifting 

The best GPOs have representatives on-hand to answer your questions and provide solutions. Many programs even have local reps that can assist members in real-time. In addition, you’ll be working with a team of supply chain professionals who have a deep understanding of the market and how to get the best deals.

Your GPO will be a resource for you should your business undergo any changes. With the unpredictable nature of the economy, it’s nice to have a reputable partner in your corner. Look for a GPO that strives to provide your company with first-rate deals and supplies.

Minimizes costs

The most obvious benefit of a GPO, your business will enjoy reduced costs on food supplies that allow you to bring in more clients and take on additional events. Plus, you’ll receive best-value pricing due to the size of the group purchasing each order. If budgeting is a primary focus for you (as it is for most growing companies!), joining a GPO should be at the top of your to-do list.

Introduces high-quality sources

One of the best things about joining a GPO is that, when you find the right one, you’ll receive high-quality products and ingredients from reputable sources. As you conduct your research, ask distributors where their products come from, so you can read up on each company and determine whether or not their supplies are up to your standards. If safe and responsible sourcing is a priority for you, there are a variety of GPOs that focus on this as well.

Joining the right GPO allows your business to access thoroughly vetted suppliers who deliver exceptional service. As a result, you can save money without compromising the quality of food you provide your clients. Things may change behind the scenes, but your reputation remains intact.

Requires no long-term commitments 

Many GPOs require no fees or lengthy obligations. You’ll still retain all of your rights as an individual business owner while reaping the rewards of the GPO itself. If you find a contract that requires a strict membership requirement or cancellation fees, consider it a red flag and look elsewhere.

To ensure you’re choosing the right GPO, request a copy of their policies and restrictions before signing any agreements. You want a reliable and trustworthy partner, not one that limits your choices as a business.

GPOs help you cut costs, save time, and protect your bottom line. If you’re looking to reduce spending, joining a GPO might be the best move you can make this year!