Supporting changing operator behaviors

A lot of operator habits have changed since the pandemic started, including where and how purchases are made.

According to a recent Technomic report, GPO purchases grew by $55 billion in 2021, indicating that operators are turning to GPO partners to save time and money, and improve efficiencies.

Digging into some stats in this recent Technomic report, Entegra’s Senior Vice President of Sales, Mike Bomstad, discusses how Entegra has helped clients with margin improvement and supply chain challenges through COVID and beyond.

Q: 63% of operators say they specifically increased their usage of GPOs because of the pandemic, and 88% of those operators expect their usage to remain elevated after the pandemic subsides. Why do you think that is?

MB: The pandemic created several unique challenges (or exacerbated already existing challenges) for operators. Among these critical challenges:

• The need to source personal protective equipment (PPE) beyond levels previously expected came on quickly. Tapping into the sourcing expertise of our Supply Management team and our buying power, the Entegra team was able to acquire and provide many of our clients with PPE not available elsewhere.
• Restaurant, lodging and leisure segment operators had to furlough a substantial portion of their procurement teams and turned to Entegra to support their skeleton staff.
• Most operators were forced to substantially reduce their front-line staff during the early phases of the pandemic and upon reopening for business, many operators found themselves unable to recall those frontline staffers previously furloughed or laid-off. Entegra, through our temp labor partners, were able to help clients fill critical staff positions.

Q: 43% of operators say GPOs have been critical in dealing with supply chain issues throughout the pandemic. How has Entegra been able to step in and help clients through supply chain challenges in the past two years?

MB: During the early phases of the pandemic, clients faced an over-supply of product and distributors were left holding significant amounts of unsold inventory. Soon, supplier and distributor resources were shifted where possible to support alternate channels such as grocery stores.

Then, as most of North America re-opened, labor shortages and supply shortages appeared across the supply chain due to multiple factors including Covid-related plant shutdowns, disincentives from stimulus provided by governments, large scale employee defections from the industry and, most recently, the war in Ukraine, collectively having significant impact to the industry.

Entegra has offered guidance to clients, supported by the knowledge within our supply management, account manager and culinary teams, by:

• Forewarning them of pending shortages and price increases
• Guiding clients to alternate suppliers or alternate distribution channels
• Helping them reconfigure their menus to use products that are more consistently available and subject to lower price inflation, driving the possibility for higher margins

Q: How can a GPO continue to bring value to clients facing lingering COVID impacts who are looking to move forward?

MB: The biggest value of Entegra comes from our teams’ ability to listen to our clients, understand their challenges and proactively work with our all supply chain partners to solve client problems. The pandemic’s challenges have also presented opportunities for Entegra to support clients beyond just saving them money, but by partnering with them to solve problem and improve their operations.