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Under extreme margin pressure, African chain restaurants turn to technology to transform supplier relationships.
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With the average gross margin for African restaurants being lower than 25%, leading restaurants across Africa are rethinking software's role in supplier relationships and in margin expansion. Here are three reasons why:
Administration is costing you more than you think
First, supply chain management in the restaurant industry is highly complex and involves multiple suppliers, each with unique challenges. Implementing effective supply management software allows IT managers to simplify these processes and ensure everything runs smoothly.
The rising cost of food
Second, the COVID-19 pandemic and the Ukraine and Russia crises have disrupted global supply chains, creating challenges that were not present. These disruptions have affected African restaurant chains, leading to shortages of essential supplies and increased costs; last year, KFC Kenya ran out of potatoes. Effective supply management software can help mitigate the impact of these disruptions and provide greater visibility and control over the supply chain.
Margin Pressure
Third, as the industry becomes more competitive, African restaurant chains must operate more efficiently and reduce costs while maintaining high-quality products and services. Effective supply management software can help optimise operations, reduce costs, and improve supplier quality, profitability, and growth by tracking supplier performance and identifying areas for improvement.
Cashflow
Lastly, as business-to-business payments become more digital, managing supplier payments and orders centrally enables businesses to keep track of payables and open new inventory financing avenues.
The future
In the last 10 years, restaurants around the world have had to adopted technologies like Uber Eats ato transform the way they generate revenue, Tto win in 2023 and beyond, restaurants must reimagine their supplier relationships. By implementing effective supply management software, African restaurant chains can improve their competitiveness and position themselves for long-term success. Software like Caantin is helping hospitality businesses streamline their local ordering and payments.