Crown Resorts: embedding quality in procurement
Founded in 2007, Crown Resorts consists of a mix of hotels, events, conferencing, theatre, gaming, and restaurants across two properties in Perth and Melbourne. With a mission statement around “creating memorable experiences”, the company instills its core values at every level of the business, particularly as it gears up to open Crown Resorts Sydney in the next 8-12 months.
According to Thomas Tuszynski, Head of Procurement – Goods, the company aims to bring value to the community. “There has to be a level of local provenance,” he explains. “My team and I are making regular trips to Sydney to find the suppliers who can bring that uniqueness to the property and a sense of community.”
Tuszynski has over 20 years’ experience in the procurement field, with the last seven at Crown Resorts. “One thing I like about procurement is you don’t realise how much value you add to the community and the industry,” he says. “I love negotiating terms that are mutually beneficial and create value.”
Tuszynski says that, in partnerships, he looks beyond transactional supplier-customer relationships, seeking parties interested in growing alongside Crown Resorts. “One thing we manage is very good supplier relationships, trying to go deep,” says Tuszynski. He is confident in the value of face-to-face interaction. “When there’s an opportunity to go see a producer in another country, I take it,” continues Tuszynski. “We invest that time to go meet the producers and understand their practices.”
Crown Resorts ensures quality by taking advantage of the assets it already has available. “Crown has given me great opportunities to innovate in a procurement function,” states Tuszynski. “It has more flexibility and creativity than most companies.” When Tuszynski first started at the company, its two properties operated on a decentralised procurement model. Within nine months, his team shifted into a centralised procurement division, leveraging the commonalities in supplies between Perth and Melbourne. “We were finding new ways of delivering value rather than thinking in isolation,” he continues.
With over 40 restaurants across two properties, and more to come once Sydney opens its doors, Crown Resorts optimises spending by buying in bulk and consolidating brands for base kitchen ingredients. “We work with our chefs to choose the most premium ingredients, then go for critical mass and volume to negotiate prices,” Tuszynski says.
When an innovation opportunity crops up, Crown Resorts takes it. It is working alongside its chief stakeholders to find a solution for a food quality problem: employing a chef on the loading dock for all quality assurance (QA) inspection at its Melbourne property. The role reduced quality issues by 66% and ended up replicated for the Perth and Sydney locations.
Crown Resorts has also been able to minimize food waste by taking advantage of opportunity buys to feed its 12,500 members of staff, which it does complementary. “We have to be on our toes to ensure we take advantage of opportunities when they occur,” says Tuszynski. “But also when something is about to hit us and have a risk management plan to execute.”
The food industry can be extremely volatile, something Crown Resorts tempers by being compliant and risk driven. With a catalogue of over 30,000 items, the company relies on technological tools. Changing to barcode scanning has allowed it to “take the supply chain to the next level.” Force to Pay (F2P) systems let the company do due diligence for its supply partner onboarding process and manage its contracts and spend analytics. “The tool has given us good data and lets us effectively manage our catalogue,” Tuszynski says. Its supply relationship tool develops a score for all suppliers based on performance. “We have that record forever,” he continues, “we can look at performance over time and reward suppliers who perform consistently.”
Considering the food industry’s volatility, partners like global consumables supplier Huhtamaki, which bring assurances around pricing and quality, are extremely valuable. Meanwhile, innovators like partner Byron Beer work actively on their own brand’s marketing and activation on premise, growing supply volume in a way that is mutually beneficial.
Partners also bring expertise. M&J Chickens approached Crown Resorts seven years ago to propose supplying all the company’s poultry, which was previously provided by its meat suppliers. As a chicken expert, M&J was able to connect with chefs to improve servicing, and work alongside Crown Resorts to solve challenges around pricing and product availability. Searching for quality can often come at a high cost. As such, Crown Resorts values premium relationships like the one with sourdough bread manufacturer Noisette, which can produce high-quality bread using traditional methods in the large volumes the company requires.
“As a five-star property, quality is something that has to be at the forefront of everything we do, from ingredients to service,” Tuszynski says. To ensure this, Tuszynski’s team runs fortnightly meetings with the stakeholders at Crown Resorts who deal directly with customers, collaboratively planning ways to enhance customer value. Part of this bid for quality includes embedding the supply chain with ethical sourcing and best practice. Crown Resorts goes through extensive due diligence when onboarding new suppliers, enquiring about environmental status and compliance with modern slave labour legislation. It does random QA checks at the docks to ensure proteins meet specifications. It also meets regularly with top suppliers and risk suppliers, discussing innovation and improvement to create greater transparency along the supply chain. “We visit manufacturers ourselves to validate and get a sense of where the item is coming from,” he explains.
Over the next three to five years, Crown Resorts is looking to optimise its opportunity buys by making a freezer into a warehouse; this will allow it to increase storage capability and reduce how much food goes to landfill. As food inflation rises over the next few years, the company is looking into how it can ensure it continues to add value through that. “Crown is going from strength to strength,” concludes Tuszynski. “We have the right mix of people, leadership, and strategy to make our vision happen. The next five years represent a very exciting time for Crown.”