Negotiating better prices with distributors

[gfron1]

I've been running my cafè for about 9 months now and in the past month or so our business has doubled. This is attributed to us building a loyal clientele through the winter, then the switch to warm weather. As a result the food distributors are paying quite a bit of attention to me all of a sudden. There are a few things that have happened that are leading me to ask for some of your expertise.

First, I just recently learned how much cheaper it is to buy my produce by the large box instead of small. For example, I was buying 10# of zucchini for around $10 and just recently learned that 28# is only $17. I was a bit perturbed that my rep didn't tell me, but in his defense I didn't need that much til recently. I've now upped all of my produce and sell my excess out of my retail op.

Second, a friend who has a restaurant told me about P1 pricing. That's a Sysco term - one of the two distributors I use (you can read all of my anti-Sysco rantings in that other topic, but I've learned that they actually have a good mix of products). I mentioned P1 to my rep and he was clearly not happy that I knew the lil' secret. I still don't know if I have it.

Third, I like to think that I run an ethical business and I watch how my reps take care of my credits...let's just say credits that aren't on the up n up. An example is that they shipped me paper product that I couldn't use (rep just got the wrong thing), so he offered me a deal to keep the product. The deal was good, so I did. The credit came through as bad cheese. My guess was that he doesn't lose his commission on bad cheese like he would with returned 'wrong item.'

So that's where I am. I'm the only growing restaurant in town and I feel like now is the time to get them to listen to me. I'm still not the biggest in town, and I know neither company does price locks - they just don't do it, so what can I do to get the most out of these guys?

[Tri2Cook]

Sysco has a tiered system for ranking their customers based primarily on how much money they're making off of you and it effects not only pricing but, in some cases, quality. There is a pecking order for produce and such when their stock forces them to choose who gets the good stuff. I was told this by a rep so if it's incorrect it's not because I just made it up.

Sysco will do price locks, at least in Canada. Not across the board but they'll lock on a high volume item or two if you're doing large and/or consistent orders with them and you're pushy enough. The rep may have some sneaky way he gets it through the company, I don't know or care. All I know is that the items that were locked for us have remained so despite a couple of nasty increases in that area of the market.