Panelists including Shangri-La Dubai?s area director of purchasing Zahid Aslam discussed a range of topics at the event, including e-procurement. Panelists including Shangri-La Dubai?s area director of purchasing Zahid Aslam discussed a range of topics at the event, including e-procurement.

“We may be effective at using e-procurement to manage process, paper flow and sharing of information, but I think [when it comes to] the final process of online purchasing we haven’t reached that stage yet,” he said.

The myth of three quotes

Another issue to rear its head throughout the day was the “myth” that procurement managers should rely on three quotes. At the start of the panel entitled “Game Changers — which planning and research strategies will guarantee success”, Shangri-La’s Aslam was quick to debunk the traditional practice of three quotes.

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“Hoteliers have a myth that if you have three quotes, you will get the best price. In my opinion you can have 20 quotes and there is no guarantee you will get the lowest possible price,” he asserted.

According to the panellists on the third session, entitled ‘Attaining the Best Value while maintaining a property’s standards’, the issue of getting the best quote was related to appropriate levels of communication with vendors.

Radha Valiathan, procurement manager, Jumeirah at Etihad Towers, said suppliers worried that if they quoted their best price initially, they would then be asked by the hotels to lower it.

“We need to get away from this,” he said. “It is better to deal with companies directly, but that all depends on their availability and communication channels. But if you source a product directly then you should speak with them, which will improve service and standards.”

He also advocated centralised purchasing to enhance purchasing power, while DHS’ Manesh Balani said e-procurement enabled fair judgement.

“We have to find a way to avoid fish market bargaining where hotels are trying to get suppliers to undercut each other. E-procurement allows suppliers to put out their very best price and benchmarks — that makes the procurement system so much easier.”

Ultimately, according to Crowne Plaza’s Nair, success in this area comes down to partnerships. She said she is not afraid to ask suppliers what their costs are and to share her own costs, in order to come to an agreement to benefit both parties.

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