Gus Sarff, GS Associates, Inc.

There is a symbiotic relationship between a procurement company and the vendors it recommends to hotel owners for the supply and manufacturer of the hundreds of custom, built-to-fit items needed to open and operate a hotel. It is incumbent on the procurement company to always have the owners’ agenda in mind when developing business relationships with vendors. Vetting for qualifications, is and should be a lengthy process, but given aggressive project schedules and the project team influence of who likes who, there is an economy of time to perform proper due diligence. Trust, most particularly in these times, is very important to create the greater probability of performance and project success. There is a balance between developing trust and maintaining the proper decorum with vendors and manufacturers to avoid conflicts of interest. There should be language requested by owners and signed by procurement companies that disallows any relationship with a vendor that would result in a financial benefit for the procurement company. The other side of the equation is that the ultimate evaluation of a procurement company is only as good as the performance of the vendors. It is a fundamental part of the procurement company’s value to find, develop and vet valuable sources. It is also important to establish personal relationships with vendor contacts who will achieve the agenda of the owner’s project and solve or prevent problems which inevitably occur. The value and power of procurement is to be able to obtain priority pricing, production and quality manufacturing. This is why hotel owners find value in the services of a procurement company. New vendors interested in working with our team and our clients, are pre-qualified, tested, sampled and reviewed. Where ever and whenever there should always be bid atmosphere to maintain protocols and keep pricing fair and honest.

Bar Boulud Boston - Designed by Adam Tihany

There are detail issues about vendors that most clients do not care about. Very possibly these are the detail issues about vendors that create the valuable relationship between vendor, procurement company and interior designer. The “pre order” or bid phase is about understanding commercial specifications, timeliness and accuracy of quotes and supporting documentation in answer to the requests for quotation. Post ordering it is about timeliness of technical documentation, quality production, logistics, delivery, communication, problem resolve and attention to detail. Any deficiency in these requirements can put a project and a reputation at risk. When vendors or manufacturers are recommended or specified, it should fit the agenda of the project balance between quality, price, ability to deliver and organizing the plethora of communication that is required to complete a project successfully.

As a procurement company, we constantly maintain our list of vendors. In some projects, other vendors are introduced by owner, interior designer, project management companies. Our agenda is to present to the ownership a shortlist of vendors that will perform at the best interest of the owner. The main vendor criteria being quality, price, experience, financial standing, terms of sale, delivery, warranty, service back up in case of problems. Once this list is reviewed and agreed upon it is bid to the market. Once bid information is received and analyzed, an intelligent discourse with the interested members of the project team is required to focus the awards on the vendors that will create the best possible outcome. There is nothing more important in a competitive, deadline driven world than having vendors, manufacturers, contractors and consultants perform. It makes all parties look good.

Aloft Raleigh, NC - Designed by One Group Design

Nor is this a one way street. Many mistakes are made in viewing the “award” of orders or contracts are somehow a favor to the vendor. While awards are good news for vendors, there is a reciprocating requirement that they are being paid an agreed upon value in return for not only providing the product as specified and ordered, but also to complete all of the processes pre and post production. And there are support works that we need to do for our vendors to make a successful performance. It seems that honest and accurate information is appreciated from the vendors as well. Status of deposits and payments. Realistic delivery demand dates. After orders are placed, there is a requirement for approvals, document submittals, shop drawings, confirmations of parts, materials, finishes, wood species, metal types, gauges, finishes all necessary for manufacturers to order materials and parts to produce, ship, warranty and possibly commission. As timelines leak, there is a lot of pressure on vendors to maintain materials deliveries from supply chains, maintain production schedules and frankly to allow enough time to manufacture, finish and package adequately for deliveries to be made. Does it actually need to be a priority production? Is airfreight really required? Ensuring that when all parties are involved in a complicated order that fairness is mediated and responsibility apportioned. Much of the works that a procurement company enacts is post order coordination to obtain documentation, send it to the appropriate reviewing and approving party for sign off and get it back to the vendor so that production can commence. Acknowledgment and feedback to all parties of extra effort when it is expended is always helpful and appreciated. When we do our job as procurement we can build up reserves with vendors to perform the “impossible schedules” or push prices lower to meet budget. But if every order is rushed and the vendor is bashed you lose valuable reserves. A bigger picture is required for long term relationships and maintaining the balance between “favorites” and potential conflict of interest.

These are the criteria we use to work with vendors. If there is a problem with payment and a vendor has done all they need to do, then in the spirit of fairness, we lobby to get payment made.

Communication, transparency, fairness, balance and reciprocation are all important factors in any relationship. It is very important to keep vendor/manufacturer relationships in perspective, maintain the highest ideals and protocols and work with companies who understand the project agenda and share similar values.

Gus Sarff, ISHC is president and owner of GS Associates, Inc., a procurement consulting firm providing FF&E and OS&E services locally, nationally and globally for luxury, convention, resort, limited service hotels, fractional ownership properties, restaurants, and function facilities.

For over 25 years, GS Associates, Inc. has continued to develop procurement technology and creative sourcing to maintain its leadership in the industry. GSA’s services are transparent, expert, and will make a positive impact on any project.