SITXINV003 Purchasing Goods: Operational Supply Chain Analysis

This project focuses on the operational aspects of purchasing goods, specifically within a food and beverage context, using the Red Rooster restaurant in Perth, Western Australia, as a case study. The project begins by outlining the operational area, the hierarchy of command, and the procedures for sourcing new supplies and suppliers, emphasizing the importance of a well-managed restaurant environment. It identifies six different types of goods relevant to the job role, including alcoholic and non-alcoholic beverages, cleaning agents, food items (dairy, dry, fresh, frozen, fruits, vegetables, meat, poultry, and seafood), general stores, housekeeping supplies, and uniforms. Furthermore, the project details the specific requirements for purchasing these goods based on upcoming functions, customer needs, and low stock levels, highlighting the necessity of clarifying specifications and quantities with relevant department heads such as the Head Chef and head waiter. The communication process and the determination of specific requirements for spices, tea, and coffee are also discussed, providing a comprehensive overview of the purchasing process within the specified operational area.

Assessment Tasks and Instructions
Student Name
Student Number
Course and Code
Unit(s) of Competency and Code(s) SITXINV003Purchase goods
Stream/Cluster
Trainer/Assessor
Assessment for this Unit of
Competency/Cluster
Details
Assessment 1 Project
Assessment 2
Assessment 3
Assessment conducted in this instance: Assessment 1 2 3
Reasonable Adjustment
1. Has reasonable adjustment been applied to this assessment?
No No further information required
Yes Complete 2.
2. Provide details for the requirements and provisions for adjustment of assessment:
Student to complete
My assessor has discussed the adjustments with me
I agree to the adjustments applied to this assessment
Signatur
e Date
2nd Assessor to complete
I agree the adjustments applied to this assessment are reasonable
Name
SITVersion 1 1 of 27
©Futura Group 2016

Signature Date
Assessment Guidelines
What will be assessed
The purpose of this assessment is to assess you underpinning knowledge to complete the tasks outlined
in the elements and performance criteria for this unit of competency and relating to the following
aspects:
Performance Evidence
 determine and confirm purchasing requirements for at least six of the goods listed in the
knowledge evidence
 make purchase arrangements for the goods to meet different:
o end product requirements
o customer specifications:
 numbers
 special requests assess supplier capacity to meet price, quality and delivery expectations for each of the above
goods complete above purchasing activities following organisational requirements for stock ordering,
including procedures and documentation.
Knowledge Evidence
 specific industry sector and organisation:
o features of products sold and the expected level of quality
o formats for and contents of workplace documents that describe supply requirements
o forecasting methods for calculating required quantity of goods
o formats for and inclusions of job costings that describe purchase price limitations
o sources of product and supplier information
o sources of information on negotiated cost of supply, contractual arrangements and preferred
supplier arrangements
o formats for and inclusions of supplier specifications for the purchase of goods
o full content of stock ordering procedures and documents
o individual stock ordering responsibilities
 sources of information to determine purchase requirements:
o buffet designs
o catering orders
o customer specifications:
 numbers
SITVersion 1 2 of 27
©Futura Group 2016

 special requests
o event orders
o event running sheets
o function orders
o menus
o operational itineraries for crew
o passenger itineraries
o passenger lists
o recipes
o reservation profiles
o rooming lists
o standard yields
 goods that need to be purchased by a business:
o alcoholic or non-alcoholic beverages
o cleaning agents and chemicals
o customer travel products:
 luggage labels
 travel bags
 travel wallets
 tickets
 vouchers
o event supplies
o food:
 dairy products
 dry goods
 fresh goods
 frozen goods
 fruit or vegetables
 meat, poultry or seafood
o fuel:
 aircraft
 coaches
 hire cars
 vessels
o general stores
o housekeeping supplies
o linen
o merchandise
o uniforms
 considerations in determining quality and suitability of stock on hand:
o ability to meet customer requirements:
 numbers
 special dietary requirements
 special requests
o ability to meet requirements of:
SITVersion 1 3 of 27
©Futura Group 2016

 event
 menu
 recipe
 touring itinerary
o for food:
 currency of best by or use by dates
 freshness
 size
 weight
 numbers of goods on hand
 organisational procedures for the supply of goods:
o completing purchase orders
o gaining authority to purchase
o limitations on which suppliers can be used
o who is authorised to negotiate and purchase
 assessment of supplier capacity to meet price, quality and delivery expectations:
o comparing price with previous supply costs
o visual assessment
o taste test for food
o visual assessment
o taste test for food
o checking on others’ satisfaction with the supplier
 determinants of the quality of goods:
o ability to meet:
 customer specifications
 organisational quality specifications
 portion requirements
o currency of best by or use by dates
o freshness
o size
o weight.
Place/Location where assessment will be conducted
RTO to complete
Resource Requirements
Computer, calculator, telephone, internet connection, Stock supplies for quality and suitability
assessment, job costings, existing supplier contracts as these exist in the organisation or RTO,
stock control procedures used in the organisation or RTO.
Instructions for assessment including WHS requirements
You are required to determine and confirm purchasing requirements for 6 different goods categories
listed in Question 3 of this project.
SITVersion 1 4 of 27
©Futura Group 2016

You are required to address and answer all questions included in this project. Your trainer will be
available to discuss your purchasing analysis and further actions and negotiations required on the
following date and
time: _______________________________________________________ .
You will be provided with feedback on your project following the submission of your work.
Statement of Authenticity
I acknowledge that I understand the requirements to complete the assessment tasks
The assessment process including the provisions for re-submitting and academic appeals were
explained to me and I understand these processes
I understand the consequences of plagiarism and confirm that this is my own work and I have
acknowledged or referenced all sources of information I have used for the purpose of this
assessment
Student Signature: Date: /
/201
This assessment: First Attempt 2nd Attempt Extension – Date: /
/
RESULT OF
ASSESSMENT Satisfactory Not Yet Satisfactory
Feedback to Student:
Assessor(s) Signature(s): Date: / /
Student Signature Date: / /
SITVersion 1 5 of 27
©Futura Group 2016

SITVersion 1 6 of 27
©Futura Group 2016

Assessment 1
Project
Your tasks:
1. Choose an area of operations relevant to your job role which may include:
Food operations
Food and Beverage
Housekeeping
Reception
Tourism outlet
Travel services
Event management
Operation/Department: Food and Beverage Job role: Chef
SITVersion 1 7 of 27
©Futura Group 2016

2. Provide a brief overview of the operational area, the hierarchy of command and the basic
procedures in place for sourcing new supplies and suppliers. If you are not working in
industry, explain how this applies in your training environment/department.
A restaurant is just not a place wherein customers come, eat and at last pay the bill for, instead it is a
place where all the things are managed properly and delivery of the outcome is made properly and
timely. Below is the hierarchy chart which explains the procedure and hierarchy of commands.
(Figure: Map of hierarchy of a staff in a restautrant)
(Source: Telstar, 2015)
According to the above image, it explains the hierarchy in the restaurant Red Rooster. The hierarchy
explain about the flow of the things and instructions from one place to another. This flow is also
maintained in order to communicate with each of the relevant department and transferring the itemsfrom
one section to another one.
SITVersion 1 8 of 27
©Futura Group 2016

Here, all the instructions are directed directly from the restaurant manager. All the major and crucial
decisions are taken by the restaurant manager which are directed to the assistant manger which is lower
than one position from restaurant manager. Below the assistant manager, responsibility for handling the
activities done on floor and kitchen is managed.
Kitchen is placed at back of the visiting place which is known as the back of the house. It is controlled
by the head chef wherein all the instructions related to preparing of food are commanded. Under the
Sous chef all other sorts of chefs works, which handles different activity under one roof.
On the other hand, for managing the floor, which is known as front of house, is also managed by
assistant manager. This hierarchy is further followed by head waiter where all the waiters report for
handing different responsibilities and this flows on further handling customers and bussers etc.
SITVersion 1 9 of 27
©Futura Group 2016

3. Identify and list 6 different types of goods relevant for your area of operations which need to
be purchased in the near future. The products must be selected from the following categories:
The restaurant Red Rooster in Perth, Western Australia is for food and beverages which is quite famous
for serving good quality of coffee in order to enhance the taste within the place Perth. The following
types of goods which are relevant with my job role are selected as:
 Alcoholic or non-alcoholic beverages
 leaning agents and chemicals
 Food:
 Dairy products
 Dry goods
 Fresh goods
 Frozen goods
 Fruit or vegetables
 Meat, poultry or sea food
 General stores
 Housekeeping supplies
 Uniforms
SITVersion 1 10 of 27
©Futura Group 2016

4. List the specific requirements which require the purchase of these goods based on e.g. an
upcoming function, banquet sheet, special customer requirements, an event, low stock,
reservations or as applicable including the order of urgency for ordering these supplies.
Provide details for how you have identified these requirements including consideration of any
existing stock you have in storage.
In order to make any event successful, a lot of requirements needs to be fulfilled. As for an event to
be organized and to make it successful, a lot of things are being required.
The requirement for an upcoming function in kitchen, fresh vegetables and fruits must be needed.
Along with this, some of the herbs and spices which adds taste in the cuisines, fresh dairy products,
supply of water, containers and utensils in order to store food, various types of drinks, uniforms etc.
are needed. In order to decorate the banquet hall, coloured sheets, flowers, colourful lights which
makes the place beautiful are required. In case the customer needs the ambience to be decorated
according to the theme, must be made accordingly.
A list of all the requirements must be made which are needed for conducting the event. All the
requirement must be matched whether they are in stock with Red Rooster or not. If any of the items
are less must be arranged within the time limit and to fulfil the requirement also. In case of low
stock, a list is prepared for the required items to be used for an event. Some of the items are brought
more in quantity in order to use them in case of emergency. In order to make the place more
attractive and beautiful, need for other stuff such as balloons, candles, tables, chairs, music system
etc. are needed which are the essential requirements of an event.
SITVersion 1 11 of 27
©Futura Group 2016

5. Contact the relevant department heads/ supervisor or persons relevant for these product needs
and clarify concise specifications and quantities required. Detail with whom you have
communicated and what was determined.
As with regards with the food and beverages , the correct person to be communicated with Head
chef. Kitchen is the only place for which Red Rooster is known for. The Head chef is the only
person who handles the responsibility of Kitchen with proper specifications.
All the requirements are being fulfilled related to food is supervised by Head chef. A list of food
items required for an event is managed by the chef and further process is also managed by the same
person. The product which is needed for the restaurant Red Rooster are various spices. The
specification for spices is that it enhances the taste of the food along with smells the food better. This
also used in various other kinds of food items and are experimented too by making various sort of
cuisines.
Whereas, for beverages, head waiter will be the correct person to contact with and to communicate
with. As for both the things are handled by two different persons, so communication is done with
both of them to ask for specification. The specification for beverages as coffee and Tea is that
various different types of drinks can be prepared from tea and coffee.
The quantity is different for both food and beverages items.
Food and beverages Quantity Time slot
Spices 20 Kg 4 months
Tea and coffee 10 Kg 2 months
SITVersion 1 12 of 27
©Futura Group 2016

6. Which forecasting methods form the basis for calculating the quantities required? How is the
choice of forecasting method established?
The forecasting methods are used in order to know about the quantity to be used for the preparing food
items. Moreover, it is also used to know the number of people to be served by the food items at the time
of visiting. This calculation also helps in analysing the sales for long and short period of time. The
following are the forecasting methods which are used for calculating the quantities required:
1. Occupancy Statistics
Cover + a guest
Number of turns = Number of covers / Number of seats
Here, the two main components of forecasting methods are guests count and average guest check.
2. Average guest check
= Food and beverage sales/ Number of covers
3. Forecasting of food
This method helps in analysing the quantity of food suppliers for preparing food. It basically focuses
on the quantity of food related items being purchased.
SITVersion 1 13 of 27
©Futura Group 2016

(Figure: Forecasting and food cost control process)
(Source: Hmforever2012.wordpress.com, 2012)
Yield factor is used to calculate the food needed by the restaurant for each food item. It is calculated as,
Yield is divided by total sales of the amount of food used in previous week. Before ordering, all the
inventory units are changed to purchase unit. This makes the calculation easier and correct.
SITVersion 1 14 of 27
©Futura Group 2016

7. Identify the stock on hand, list the quantities available and indicate whether these need to be
considered in your purchasing order.
In a kitchen various items are present which are used in preparing food items. Whereas some of the
equipments are used in helping in making different cuisines. Below is the list of all the items which are
used in kitchen for different purposes along with their quantity and are they to be included in purchasing
list or not.
Stock in hand items
Stock in hand Quantity Purchase list (Yes/No)
Extra-Virgin oil 10 liters Yes
Nonfat Green Yogurt 20 kg Yes
Honey 10 kg No
Beans 15 kg Yes
Eggs 9 Dozen Yes
Sea salt 4 kg No
Tomato paste 7 kg Yes
Fresh Herbs 5 kg Yes
Bananas 3 Dozen Yes
Chocolate 2 kg Yes
Garlic 3 kg No
Mustard 5 kg No
Oatmeal 4 kg No
Flavoured Vinegar 6 litres No
Ground Chicken and turkey 3 kg Yes
Bread knife 6 sets No
Chopping boards 10 pieces Yes
Grater 10 sets Yes
Vegetable peeler 15 pieces No
Rolling pin 20 pieces No
Blander 10 pieces No
SITVersion 1 15 of 27
©Futura Group 2016

8. Determine the price limitations for 3 products you have listed on your purchase list using job
costings from your organisation. How does this affect the maximum price you can pay for the
purchase of the product? Why? Are there any processes for this in your workplace or in the
RTO? What are these?
The prices of the items being sold are different from the prices being set by the organization.
Items Job costing Maximum pricing Justification
Extra-Virgin
oil
60 $ 250 $ The price for Extra-Virgin oil will cost a customer
more as more of the types of ingredients are also be
included in preparing of cuisine. Along with this the
prices of oil are also increasing day by day. It also
includes some of the profits too.
Nonfat Green
Yogurt
40$ 110$ The prices of the yogurt are offered in different
flavours which includes nuts and flavours too.
According to the market research, the prices of the
competitors are also high in the market which makes
the prices of the final product expensive.
Bananas 50 $ 200$ The dishes made by the bananas are higher than the
costing of the organization as many other ingredients
are also includes in it along with other cists too. In
market the prices of the same dishes is quite more
than Red Rooster.
SITVersion 1 16 of 27
©Futura Group 2016

9. Write the purchasing list based on your requirements and the stock on hand.
Purchasing list
Stock in hand Quantity Purchase list
Extra-Virgin oil 10 liters Yes
Nonfat Green Yogurt 20 kg Yes
Beans 15 kg Yes
Eggs 9 Dozen Yes
Tomato paste 7 kg Yes
Fresh Herbs 5 kg Yes
Bananas 3 Dozen Yes
Chocolate 2 kg Yes
Ground Chicken and turkey 3 kg Yes
Chopping boards 10 pieces Yes
Grater 10 sets Yes
SITVersion 1 17 of 27
©Futura Group 2016

10. List the suppliers who are used by your establishment to source these products from.
In a restaurant various types of things are being supplied. This is done from various sources and
suppliers. A list is made for the suppliers who supply the products in the restaurant.
Numbers Suppliers Description
1 Vegetable Vendors Provides vegetables in large stock
2 Poultry farms Provides meats and eggs
3 Wholesalers Supplies herbs, spices, dal, beans etc.
4 Dairy farms Supplies various fresh milk made products.
5 Fruit Vendors Provides fruits
SITVersion 1 18 of 27
©Futura Group 2016

11. Identify the organisational purchasing procedures which form the basis for purchasing goods
and sourcing suppliers in your establishment and provide the details for these.
Making a purchase for an organization is not at all easy. It takes a lot of pain in order to maintain it and
to make the purchase. The steps for making a purchase are explained in detail.
1. Recognition of need: Need for purchasing the product needs to be arise. It must be evaluated
clearly that the need for purchasing the product has or not. If yes, the need arise, the process
must be followed further.
2. Description of need: The description of needs to be defined clearly so that the product can be
easily purchased. The requirement of the need and its description is denoted with the quantity
and quality.
3. Selection of suppliers: After analysing the need and providing for the description, selection of
the suppliers to be made. As there are a lot of suppliers present in the market which holds
different quotations and are ready to make the deal.
4. Determination of suppliers: According to the requirement and quotations of the suppliers, the
suppliers list is shot listed. The background and details of the order is made clearly without any
confusion. This makes easier to choose among many suppliers and makes deal with them.
5. Preparing for purchase order: After the decision is made for selection of the suppliers,
preparation of the list of purchase is prepared.
6. Placing the order with a selected supplier: After finalizing all the details in the purchase list
and matching all the requirements with the suppliers, the order will be places to the respective
supplier. This starts the process further and move ahead in order to complete the purchasing
process.
7. Monitoring and follow up the order: Once the process gets started, timely monitoring of the
process is to be done. Time to time monitoring of the process and steps indicates that there
should be no mistake arised. In case they arise, must be corrected before it gets too late.
8. Receiving the order materials: The order which is made to the suppliers should be received in
proper condition. Details regarding confirming the order and dispatching the order must be
shared with the clients timely.
9. Checking and approving for payment of suppliers: After the order received by the client,
proper checking is to be done. Each of the items mentioned in the order list must be received and
no item should be left to deliver. At the final stage, payment is to be made to the suppliers after
full inspection.
SITVersion 1 19 of 27
©Futura Group 2016

12. Source 2 suppliers (other than those you currently use) in your area or region and obtain
information for prices and service provisions for the 6 products you have identified for
purchasing in Question 3. (info may be entered in table) – You are required to list your sources
of information
Suppliers Water and store vender
Products Alcoholic or
non-
alcoholic
beverages
leaning
agents
and
chemic
als
Food Uniforms Housekeeping
supplies
General
store
s
Prices 40$ 35$ 400$ 120$ 200$ 180$
Service
provisions
The services which
are provided by the
vendors are water
which is used in
various drinks.
The services
provided for
chemicals
which are used
to clean up the
kitchen and
visiting areas
along with
facilities.
Food items
supplied by
the vendors
along with
other stuffs to
prepare
various
cuisines.
Uniforms are
made to wear
by the staff
people and the
people
working in the
kitchen.
House helps in
making the
place to look
clean and
beautiful. Other
than that, other
types of clothes
are also used
such as towel or
cleaning cloths.
General
store
includes
other type
of stuff
which is of
less
importance
at the place.
SITVersion 1 20 of 27
©Futura Group 2016

13. Using the table below enter the details for product specifications and prices from your existing
supplier and those from your 2 new sources.
Price
Conditions e.g. delivery time
frames
Availability
Account Requirements
Payment terms
Item/
Product
Qty In
Stock
Purcha
se Qty
Specification
Comparable
size/Qty/Qualit
y
Exist. X Z Existing
Supplier
Supplier
X
Supplier
Z
leaning agents
and chemicals
20
litres
15 litres Product should
consists of
Lemex brand
leaning agents
and chemicals.
20$ 22$ 26$ Osten Bingo Penguin
Uniform 10
pairs
10 pairs Uniform must
be consists of
Blue whale
brand for
preferring
quality products
30$ 33$ 37$ Mega Petson Oxen
SITVersion 1 21 of 27
©Futura Group 2016

14. Analyse and compare the prices and conditions and provide an overview of your findings
(given that you would have to make a decision based on the best deal and conditions for
supply).
The prices of the product and services for different suppliers are different. The changes in the prices of
the suppliers are changes as the client need some of the good quality product and services from the
existing one. Moreover, many of the new technologies arises which makes the payment methods
changes. Change in the mode of payment makes brings changes and allows some or the other discounts.
Some of the payments are made in cash terms whereas some are done on credit basis. It is also being
noticed that how much stock is available with the organization in current situation. It is also analysed
that the amount of stock is being ordered along with the quality.
SITVersion 1 22 of 27
©Futura Group 2016

15. Conduct an assessment of the quality of goods for the suppliers of goods identified in Question
14. List the methods you will employ to do this to ensure you will get quality supplies. Your
responses need to include reliable processes to ensure quality will be ensured.
The restaurant named Red Rooster is the only one of the restaurant in Australia which has a variety of
cuisines offered to the customers. A variety of new cuisines are only offered by the restaurant Red
Rooster. This is the reason which makes it different from other places. Along with this the quantity and
quality of the product being offered is also high other than the competitors. Taking about the prices
being offered to them are also different and with the budget of the customers.
As per the audit being places in the restaurant many a times the feedback is always received in positive
terms. The reviews provided by the customers on different plate forms are positive and satisfactory.
SITVersion 1 23 of 27
©Futura Group 2016

16. Take your findings to your trainer or Supervisor and discuss the options for further price
negotiations. What has been discussed and determined, and how does this fit in with the
requirements established in Question 11?
According to the deep analyses and finding it is evaluated that the prices of the new suppliers are a
bit high comparing with the existing one. The prices can be negotiable according to the availability
of the product on time and quality of products being provided by the suppliers.
It is being analysed that the previous supplier was on the particular scale for cracking the deal on
minimum prices. Base can be made by this also.
Also it is analysed about the benefits provided from the supplier’s side. Not only the prices are being
negotiate, the benefits are also considered with the products also.
The discount rates are also included at the time cracking deals while suppling the products. Various
terms and condition are also be made in case the product gets expired before time or gets destroyed
at the time of delivery.
SITVersion 1 24 of 27
©Futura Group 2016

17. Write the purchase order(s) following the analysis and discussion with your trainer and specify
the order of priority according to the needs identified in Question 4.
The list of purchase order in the Red Rooster is defined below:
SITVersion 1 25 of 27
©Futura Group 2016

18. Draft emails for each supplier you have determined for sourcing your supplies and inform
each supplier of the requirements and specifications you have determined. Ensure the details
of your organisation and the supplier clearly feature in the email including contact details,
salutation, dates/timelines, etc.
Dear suppliers,
Please find the attachment of the purchase order no. 47000089 from Red Rooster.
This document is generated by our system and is therefore valid without signature.
Details of the content and contact person prefer to attached in PDF format.
Best Regards
Dolly
Red Rooster AG
SITVersion 1 26 of 27
©Futura Group 2016

References
1. Telstar, 2015, Map of hierarchy of a staff in a restautrant.
2. Hmforever2012.wordpress.com, 2012, Research on how restaurants do their forecasting and
food cost control process, [Online], Hmforever, Available at:
https://hmforever2012.wordpress.com/2012/10/24/2-research-on-how-restaurants-do-their-
forecasting-and-food-cost-control-process/ [Accessed on: 10 September 2019]
SITVersion 1 27 of 27
©Futura Group 2016