ProBuy beats Entegra Procurement Services® and ClubProcure™ every time.
“Rebate Only Procurement Services” cannot beat ProBuy
Both of these great giant companies offer many things that ProBuy does not offer. Frankly, ProBuy does not aspire to try to be everything to everyone. ProBuy has focused and perfected a program relationship with a major broad line distributor.
Both of these fine giant companies who are popular in the Restaurant or Golf and Private Club Community offer many things that ProBuy does not offer and never will.
A partial list:
Rebates VS. A True Program
One of those giant companies has on their website …. “Purchasing Flexibility”. This is 110% true. All of the major Club and Restaurant companies with 100+ Units know the truth. Rebate programs are easy. However, if a rebate program was the absolute best approach and offered the most savings, why would all Major Chains bother to negotiate a true margin over cost program for their group of Operators?
MDA’s (Master Distributor Agreement) are complicated and have demands on the buyer. But MDA’s save the operators much more money … every time! ProBuy has spent the time and effort to secure an MDA for its clients. Our clients save money on all broad liner category items. Imagine a single operator with the buying power of the major chains.
Then there is Rebates:
Our culture loves Coupons! At the grocery store, redeeming Coupons give most people that warm and fuzzy feeling of accomplishment. Rightfully so. Foodservice uses a similar process … “buy my product and I will send you a rebate check back”. When that check shows up there are many warm and fuzzies to pass around. Many Club buyers use this Rebate check to show their Manager that they are an astute buyer and are vigilant in maximizing their purchase dollars. The buyer is truly sincere and believes what he/she is saying. However, the truth is much more complicated.
Rebates VS. Protected Pricing
In the distribution business, as a customer, you are either part of a group that is known to have an MDA or you are “on the street”. There are many differences between the two but the major difference for this conversation is “Price Protection”.
Here is a real example from a potential client analysis:
Our actual program price for this Folgers coffee item in that market is around $58.00.
If you are on the street, you do not have price protection. Did this Chef get his 2% Rebate back? Get a check back for $2.08 but get overcharged $43.35 in the first place. Your Rebate company has no control of local invoice prices. They can only pay you back what they have negotiated with Folgers or whoever.
Scrutinize Invoices VS. Servicing Your Members / Customers
The above example is an extreme case and DOES NOT happen all of the time. But it shows that if you have a busy Chef, Kitchen Manager etc., do they really have time to scrutinize EVERY ITEM? This is true no matter what size operation you may have. Smaller operators may have one lead person with some support staff. Larger operators may have a Chef, Sous Chef, lead cook and prep people. It really doesn’t matter. In all cases, there is typically not anyone available to devote the many hours necessary to scrutinize every invoice and every line item. Even if you did, how will you know what is a good price for that Folgers item? What is a good price on trash liners? What is a good price on Sterno? What is a current good price on Avocados? On and on and on.
“Rebates on MORE items”
When we went to secure our MDA, we decided to create something unique. The two major Rebate Only programs typically go to the major manufacturers like Heinz, Hunts etc. and ask for rebates for their clients. The kicker is that most distributors are not crazy about that relationship.
As you may know, grocery stores make much more money on their house brand then they do on major label products. Their coupon system is typically focused on major national brands since they get a piece of that manufacturer’s money. However, their house brand eliminates the middle man and leaves more room for cheaper prices. So goes Distributor branded products. For instance, our major distributor branded french fries are actually made by Simplot.
Rebates on Branded Product:
Knowing that love-hate relationship of promoting major manufacturing products vs. in house-branded products, we committed to our distributor that we would only promote branded products and we solicited a 1% Rebate back to our clients. The % is less than the two giant rebate companies but the ProBuy program pays on many more applicable items. For instance, not only can you buy Simplot french fries for your Members / Customers and get a discounted case price at the back door, you then get a Rebate Check back at the end of the quarter! Our clients are currently averaging over 60% of the items purchased are rebate items.
We are NOT better negotiators than you:
Most operators are great negotiators. We are certainly NOT any better at negotiating than you. Imagine if you went to 20 of your neighbors and all of you agreed to pick one certain auto dealer and all agreed to buy their next vehicle from them. You can walk into the dealership and by-pass the sales team and go right into the “fleet” office. This is the place where your city, county, major employers go to buy their vehicle fleet. The fleet guy will typically offer you a straight $200-$500 over their TRUE invoice cost. Not having to pay commissions to any of the sales team makes it a no brainer for the dealer. (Plus, they still get the 2% from the factory on the back side). It is a win – win for everybody! That’s ProBuy. Request a FREE Analysis and help us help you.
We use our multi-unit clout to coordinate a pre-arranged structure where the distributor is allowed to make X% over their true landed cost (product cost + freight). Being inside this new multi-unit structure and outside the traditional games, your pricing is verified by ProBuy’s audit privileges. ProBuy is allowed to basically look at the books to verify the arrangement is being honored. With a written distributor agreement, ProBuy clients get the best prices on ALL items and EVERY invoice with no further negotiating. Simple and effective.
However, if you do not feel that you are getting a benefit, you can always go back to your old way and cancel our agreement. To date no one has done that. Why? Because ProBuy does exactly what we promise. We negotiate your new pricing as if you were a multi-unit operation. And then keep a consistent watchful eye on all invoicing to assure their negotiated costs are honored.