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Lecture Hotel management and operations (5th Edition): Chapter 8.6 - Michael J. O'Fallon, Denney G. Rutherford

Violence is the leading cause of workplace fatalities in the hospitality industry (US Department of Labor, 2002). There are two categories of workplace violence: Explicit violence – is that which is specifically directed at a hospitality employee. Implicit violence – occurs in a hospitality establishment but is not directed at an employee. | The Hotel Purchasing Function C. Lee Evans Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Introduction Up until the late 1980’s, various tax advantages/benefits were the primary reason for the construction of U.S. hotels, Profitability is now required, along with maintaining the established level of quality. This has brought about a new level of interest on the purchasing function. Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Introduction Cont. Managers realize that true cost saving generated in the purchasing department are dollars that drop directly to the bottom line. The true definition of purchasing should be: purchasing the right product, at the right price, at the right time. The hotel purchasing function supports virtually every department within the property. Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Introduction Cont. The purchasing manager usually reports to the hotel controller or the hotel’s financial control division. The purchasing function is changing for several reasons: In the past 5 to 7 years hotels have undergone tremendous consolidation. Many of the hotel companies today have centralized the purchasing function to some extent. Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Purchasing Organization The purchasing department can be organized into three basic areas: Administrative – consist of pricing, vendor selection, and the purchase of nonstocked items. Receiving – Two categories: Hotel goods that are placed in storage in the purchasing area or items that are immediately issued to the requesting department. Items that have been shipped to a registered guest or expected guest. Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Purchasing Organization Cont. Issuing – Two categories: Consumable food and beverage supplies consisting of all food items and liquor, beer, wine, and mixes to be held in the purchasing department storerooms. Items consisting of office | The Hotel Purchasing Function C. Lee Evans Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Introduction Up until the late 1980’s, various tax advantages/benefits were the primary reason for the construction of U.S. hotels, Profitability is now required, along with maintaining the established level of quality. This has brought about a new level of interest on the purchasing function. Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Introduction Cont. Managers realize that true cost saving generated in the purchasing department are dollars that drop directly to the bottom line. The true definition of purchasing should be: purchasing the right product, at the right price, at the right time. The hotel purchasing function supports virtually every department within the property. Copyright © 2011 by John Wiley & Sons, Inc. All rights reserved Introduction Cont. The purchasing manager usually reports to the hotel controller or the hotel’s financial control .