Gemstone Hotels & Resorts
John A. Lunsmann, corporate director of purchasing
Gemstone Hotels & Resorts is a full-service management and asset management company specializing in upscale urban hotels and complex resorts. At an annual GM meeting in 2006, they decided to move beyond independent purchasing programs for each of the 14 independently owned properties.
Avendra was one of the options evaluated as part of an initiative to establish corporate-wide policies and procedures around purchasing.
John A. Lunsmann, corporate director of purchasing, had just arrived at Gemstone, but he had Avendra experience. One year later, John and his team relied on Avendra to demonstrate to the GMs exactly what Avendra offered: the same products at 10-12 percent savings. As John summarizes, “How do you argue with that?”
The next challenge was implementation within this company known for high caliber chefs, each with their own modes of operation. In addition, most Gemstone hotels are historical properties with limited storage, which meant some one-on-one adjustments.
Gemstone clearly found enough flexibility in the Avendra program to make the transition successfully. The results say it all: their first year with Avendra saw up to a 5 point savings in the food and beverage category alone.
Seeing is Believing
“We saw big wins immediately and we continue to see them,” summarizes John. An early success was Cintas uniforms, since 90 percent of the properties already used them and could see quick results. Recent savings include DHL (producing 50 percent savings), and Ecolab (effecting a 12 percent savings on chemicals.) John’s involvement with the portfolio at the property level is one of the main reasons behind Gemstone’s big Avendra success; his purchasing expertise helped reinforce the value Avendra brings throughout the supplier and product transition phase.
Gemstone has come to value Avendra’s reporting function. “Avendra’s monthly spend report provides a level of detail that would be difficult for us to generate in-house,” summarizes John. “It’s a tool that helps us better manage all of our spending.”
The bottom line: Owners are pleased because operating costs are down; GMs are happy because incentives are up; and Gemstone has an effective yet flexible purchasing program.
“At this point, Avendra is part of any rollout, to get hotels off on the right foot,” says John. We even use Avendra as a selling point, to show prospective clients we’re on top of the purchasing game.”