I’m thrilled to sit down with Katarina Railko, a seasoned hospitality expert with deep roots in the travel and tourism industry. With her extensive experience and a passion for events and expos, Katarina has become a trusted voice in helping hotels navigate the complexities of operations and profitability. Today, we’ll dive into the transformative power of strategic procurement in hospitality, exploring how it can bolster margins, the role of technology in streamlining processes, and why visibility into spending is a game-changer for hoteliers facing today’s economic challenges.
How would you define strategic procurement in the hospitality industry, and what sets it apart from the more traditional purchasing methods hotels often use?
Strategic procurement in hospitality is about looking at purchasing as a core part of the business strategy, not just a task to check off. It involves planning, analyzing data, and aligning buying decisions with long-term goals like cost control and guest satisfaction. Unlike traditional methods—where purchasing might just be about ordering what’s needed at the moment—strategic procurement focuses on building relationships with suppliers, optimizing costs, and ensuring consistency across operations. Many hotels still use a reactive approach, where staff like chefs or housekeeping managers order based on immediate needs without a bigger picture, often leading to inefficiencies or higher costs.
What do you see as the most pressing challenges hoteliers face in procurement today, especially with economic and supply chain uncertainties?
Hoteliers are grappling with a perfect storm of issues. Economic pressures mean tighter budgets, while supply chain disruptions can delay deliveries or spike prices unexpectedly. On top of that, guests now expect more—think personalized experiences or sustainable products—which adds complexity to sourcing without breaking the bank. These factors force hoteliers to rethink how they procure everything from linens to food, balancing cost with quality. Without a solid strategy, it’s easy to overspend or end up with inconsistent supplies, which can hurt both operations and the guest experience.
Can you share how procurement directly impacts a hotel’s profit margins, and why saving in this area can be more powerful than chasing new revenue?
Absolutely. In hospitality, margins are razor-thin, so every dollar saved in procurement goes straight to the bottom line, unlike revenue which often comes with associated costs like labor or marketing. Saving through smarter purchasing—whether by negotiating better supplier deals or reducing waste—has a direct, amplified impact. For instance, cutting costs on bulk items like cleaning supplies or non-perishable goods can add up quickly without guests even noticing. It’s often easier and faster to save a dollar here than to earn an extra one through sales, especially in a competitive market.
Why is having clear visibility into spending and purchasing patterns so crucial for hotels, and what happens when that visibility is lacking?
Visibility is everything. When hotels can see exactly what they’re spending, where, and on what, they can spot inefficiencies and make informed decisions. Without it, you’re flying blind—teams might over-order, duplicate purchases, or miss bulk discounts because no one has the full picture. I’ve seen cases where hotels couldn’t even answer basic questions like how much they spend monthly on certain categories because data was scattered across departments. This lack of clarity often leads to higher costs, stock issues, and frustrated staff who are scrambling to fix problems reactively.
How has technology reshaped procurement in the hospitality sector, and what should hoteliers prioritize when choosing a tool for their operations?
Technology has been a game-changer by centralizing and automating procurement processes. Modern platforms bring all purchasing data into one place, integrate with systems like accounting or property management, and provide real-time insights into inventory and supplier performance. This means less guesswork and more efficiency. When choosing a tool, hoteliers should look for features like ease of use, integration capabilities, and analytics that help predict needs or flag cost-saving opportunities. It’s also key to pick something that aligns with the hotel’s scale—whether it’s a single property or a portfolio—and supports goals like sustainability if that’s a priority.
Many hotels still rely on staff like chefs or housekeeping managers to handle procurement without much structure. Can you explain why this approach often falls short?
When procurement is left to staff who are already juggling other roles, it’s rarely done with strategy in mind. Chefs might order based on what’s urgent for the kitchen, not considering bulk deals or alternative suppliers that could save money. Housekeeping managers might do the same for linens or amenities. This fragmented approach leads to inconsistent purchasing, missed savings, and sometimes even quality issues because there’s no oversight or data to guide decisions. It’s not their fault—it’s just not their expertise, and they don’t have the time or tools to optimize the process.
Looking ahead, how can a strong procurement strategy help hotels stay resilient in the face of economic downturns or market unpredictability?
A solid procurement strategy builds a buffer against uncertainty. By locking in favorable supplier contracts, diversifying sources, and using data to forecast needs, hotels can avoid being caught off guard by price hikes or shortages. Technology plays a big role here, too—tools that predict demand or automate reordering help maintain stability even when markets are volatile. I’ve seen hotels weather downturns better by having tight control over spending and flexible supplier relationships, allowing them to pivot quickly without sacrificing quality or cutting corners that might hurt their reputation.
What’s your forecast for the future of procurement in the hospitality industry, especially as we head into 2025 with ongoing challenges like rising costs and supply chain disruptions?
I think 2025 will be a turning point for procurement in hospitality. With costs still climbing and supply chains unpredictable, hotels that haven’t embraced strategic procurement or technology will struggle to keep margins intact. We’ll see more adoption of predictive tools that use data to anticipate needs and automate routine tasks, freeing up teams to focus on strategy. There’s also likely to be a bigger push for sustainability in sourcing as guests demand it, which means procurement will need to balance cost with ethical considerations. Ultimately, hotels that treat procurement as a core driver of performance—rather than an afterthought—will be the ones that thrive in this challenging landscape.
