Task Performance: Distribution, Production,

And Purchasing of the Hospitality

Sector and Supply Chain

The Orchard Hotel

Supply Chain Management

In Hospitality Industry

Submitted to:

Ma’am Manuel, Cherrie Mae

Submitted by:

Bao-idang, Mary Grace

Gaewen, Aprilene

Sebastian, Jessielvie C.
 The Hotel Orchard Baguio

The Orchard Hotel can be located at #49 Legarda Road, Benguet, Baguio. It is

less than 1 km away from Burnham Park. The property is around 1.6 km from Session

Road, 2.1 km from SM City Baguio and 2.6 km from Lourdes Grotto. Mines View Park is

about 2.7 km from the hotel, while Tam-Awan Village is 5 km away. (Distance in

property description is calculated using OpenStreetMap)

The Orchard Hotel Baguio provides accommodation with a restaurant which is

the King Chef Dimsum Baguio, free private parking, a bar, a terrace, and a family room.

All units include kettles, and it features a private bathroom with bidet and slippers. Every

room has free Wi-Fi while selected rooms have balcony. Guest rooms at the

accommodation are equipped with a flat screen TV with satellite channels and safety

deposit box.

Lastly, a la carte breakfast is available daily if you are looking for food early in the

morning and English and Tagalog is spoken at the reception.

THE ROLE OF DISTRIBUTION, PRODUCTION, AND PURCHASING IN THE HOTEL

ORCHARDS HOTEL SUPPLY CHAIN

The role of distribution management in The Orchard Hotel, is to oversee the

movements of goods from the manufacturer or supplier to point of sale and stocks. It is

an important aspect of the hotel business cycle for distributors. The Orchard Hotel’s

distribution process includes numerous activities and processes such as inventory

for them is very important for businesses to remain competitive to satisfy and provide

the needs of the customers. It also ensures that their supply chain is efficient enough to

reduce the distribution costs to allow the products to be sold at the right price, thus

supporting the marketing strategy, and maximizing the profit. The distribution refers to

the objects/things included in the service that the guest of The Orchard Hotel had

purchased such as extra pillows, blanket, hygiene materials, Wi-Fi and more. Some of

their distribution channels also includes their direct website booking (The Orchard Hotel

Baguio), metasearch sites (they are found in the app booking.com), and many more to

acquire guests and customers.

Second, the role of production in The Orchard Hotel facilitates the process of

production and service activities. For the process of their production, it is essential that

inventory is well-maintained as well as proper planning to the supply of goods. At each

stage, production of goods without hassles will sustain a smooth business process. So,

for the success of their hotel business especially with the demand and supply, it needs

to be studied carefully to achieve the desired products to be distributed and provided to

what customer needs. This said products include the services, facilities, food, and

beverage that are offered inside The Orchard Hotel. The reason in doing so is to create

a successful supply chain management system in their production. This is to ensure that

they have enough food to accommodate their guests or even have enough resources to

cope up with the requests of their guests like extra chairs, pillows/blankets, wi-fi

password and more.

helps in optimizing costs in the supply chain. Things such as needed extra tools for

maintaining the hotel, food and beverage, cleaning, production, service material and

equipment are some of the things being purchased in here. Every department like the

HR, kitchen, banquet, housekeeping etc. has its specific needs when it comes to

purchasing of equipment/materials that defines the purchasing department functions, so

it is basically based on each department’s needs like paper and inks for the HR,

cleaning materials for the housekeeping, ingredient stocks and food materials for the

kitchen and banquet. Purchasing is very important to ensure the supplies, services, and

equipment needed. These things need to be always available to the operations that is

appropriate in standards with the right price and at a minimum cost to meet the needs of

customers. By following established purchasing procedures, an operation can avoid

many purchasing pitfalls such as panic buying, over or short purchasing and buying by

price rather than the quality.

AVANTAGE AND DISADVANTAGE OF ALL THREE FUNCTIONS IN THE SUPPLY

CHAIN MANAGEMENT OF THE ORCHARD HOTEL

Understanding the advantages and disadvantages of a hotel like the Orchard

Hotel is good to identify present and future problems that the company might encounter.

Taking down notes of these advantage and disadvantages will help you grow your

business more.

Advantage:
HOTEL DISTRIBUTION 

 Faster distribution channel management- can speed up the processes

associated with managing channels. For instance, customers will no longer need

to log in to the system of each online travel agent or distribution partner to

adjust. 

 Fewer booking mistakes- through enhance transparency and up to date

availability, improved accuracy can solve human error issues, such as over

booking hotel or property 

 Facilitate direct hotel bookings- most distribution platforms also include a built-in

booking engine, or the ability to connect with own booking engine, allowing

customers to make direct bookings. Direct bookings are the simplest distribution

channel and do not require the hotel to pay commission fee to a third-party

distribution 

HOTEL PRODUCTION 

 A hotel production is when you have lower manufacturing cost than your

competitors. Production advantages can also come from proprietary businesses

to manufacturer hotel products that are hard for competitors to copy. In hotel

production, production travel can help with flights for production and other group

tours. 

HOTEL PURCHASING 

 In hotel, purchasing functions is concerned with acquiring goods and services for

use by the organization. These will include, for example, raw materials and

components for manufacturing and production equipment.   

 Negotiate prices, build quality, and delivery terms 

 Run quality control and product testing 

Disadvantage:

HOTEL DISTRIBUTION 

 Revenue loss- manufacturer sells his product to the intermediaries at a lower

cost than the price at which trader sell to the final customers. So, the producer

goes for a loss in revenue. 

 Lack of control- company will not pay the same attention to all retailers. In

addition to, they might overstate about the benefits of the product thus may lead

to miscommunication problems with end customers. 

HOTEL PRODUCTION 

 The work pattern (long hours and weekend work)- It is not uncommon within the

hotel industry to hear of long working hours, multiple shifts and working weekend.

Sometimes work force lacks and the production of the goods or services are

affected. From the word lack, it means that not all of the expectations of the

customer/guest were not met.

 Quality and output problem- unreasonable production schedule results to either

good or bad quality product. If that happens there will be a supply chain

interruption and maybe high inventory rate

HOTEL PURCHASING 
  Late Purchasing Approval- the primary responsibility of purchasing is to make

goods or services always available. Late deliveries are highly unacceptable when

it comes to this because availability of the goods or services will be affected. This

will create low quality reviews from customers/guests and will also lead to

complaints because it can’t meet the needs of the customers.

 Lack of trust between the hotel and the supplier- a lot of company, organization

and businesses ignores the supplier assessment and just focus on what was

written on the paper both parties had signed into. Lack of assessment before

doing business will only leave a space for irregularities and untrustworthy

experiences. Lack of trust to both sides of the deal may lead to further problems.

ACTIONS TO TAKE TO IMPROVE THE DISTRIBUTION, PRODUCTION AND

PURCHASING FUNCTIONS OF THE HOTEL

Distribution:

 Maintaining profitability- costs are deductions from revenue so they decrease the

profit levels. The higher the food cost, the lower the ability to produce profit.

 Keep track- having a fixed schedule and inventory management will certainly

help with the organization of your daily distribution of goods or services. This will

also lessen miscommunication between customers and off course your supplier

because you have a keep of track when you needed to re-stock.

Production:
  Improve manpower- adding more manpower means more helping hand to have

inside the hotel. If there are enough people to tend with services and create

goods, then there will be no requests that is not addressed.

 Do not accept poor quality or lower cost- there are a lot of company who tends to

go for poor quality products for a lower cost but doing this will create a higher

quality risk in which customers may complain about like for the quality of

blankets, pillows, and taste of food inside the hotel. Consumer feedbacks will be

a very helpful thing to strike a better balance an create a profit margin that will be

reached.

Purchasing:

 Advance passing of approval form- this is in terms of the inventory of a certain

goods or products. Having 3 days to 1 week as an advance date in passing the

approval form will help avoid late scheduled purchasing and arrival of stocks.

This is especially implemented inside the restaurant of the Orchard Hotel since

food and beverage mostly consumes a lot even in a day only.

 Conduct thorough supplier evaluation- assess before you pick or select you

supplier/s. You also need to include those major suppliers in that assessment

especially during problem-solving processes. If this continues, then there will be

a positive outcome for overall growth of both the hotel and the supplier’s part.