Mitch Parker is a partner of The Parker Company. He co-directs the FF&E division and has been with the company for more than 32 years. He is also responsible for all operational aspects of the company including IT, HR, and accounting.
Tell me a little about The Parker Company.
The Parker Company was founded in 1969 by my father Leonard, who is an icon of our industry and created the “Agent Only” purchasing method which essentially all purchasing agents use today. We provide comprehensive FF&E and OS&E procurement for resorts and hotels worldwide.
Why does anyone need a procurement agency? How much do you actually do, and why don’t your clients just do it themselves?
Purchasing agents provide specialized expertise in the procurement process including bidding, merchandizing, expediting, logistics, cost savings, and problem solving. Working as part of the team, we effectively manage hundreds of purchase orders containing thousands of items per project and ensure that they all arrive on time, under the owner’s budget. Clients generally are better served using purchasing agents because of our experience, expertise, and buying power.
What are some hot projects you’re working on?
We are working on the Shinola Hotel in Detroit, the TWA Hotel & Conference Center at the famous Saarinen Terminal at JFK Airport in New York, and the Oceanwide Park Hyatt in Los Angeles.
Do you see recent or prospective changes within the hospitality industry as affecting your role in the industry?
Not really. A hotel is comprised of too many moving parts for it to magically materialize and be ready for a guest to check in without the help of a purchasing agent.
What might be presenting a challenge for you in the current state of the industry?
Business has been good for a long time in a cyclical industry. The law of averages predicts that the cycle must have a downturn.
I was recently at AAHOACON17, where there was little representation by procurement companies as far as I could tell. Why do you think that is?
I believe AAHOA is primarily comprised of small business owner-members of select service and limited service properties which are typically less complicated from a purchasing perspective. Many of these owner-members utilize in-house purchasing.
Do you think it’s important to reach the next generation of young hoteliers? How are you going about this?
The Parker Company is a fourth-generation company, and I think it is paramount that the young hoteliers, designers, and purchasers learn from their mentors but also bring their unique and current perspective to the industry.
In your experience, do you often/ever see owners breaking out of the 2-3 star range and moving to the 4-5 star? What precipitates this movement, and how can your company facilitate such vertical movement?
We have a number of clients that have a diversified portfolio of hotels, but we generally find that our clients stick to their star range of comfort.
Do you use the internet for purchasing? Websites seem to focus more on consumables, OS&E products. Do you see online sales as a convenience for you or potential threat to your business?
Our expertise is in the higher end of the market where custom product is prevalent. As such, the Internet is not a good tool for custom products. In addition, the Internet has a retail mentality and issues such as quality, durability, and performance from non-hospitality suppliers is significant. I do believe we will see growth in Internet purchasing for the limited services properties, and I am certain we will see hospitality focused suppliers increase their standard product offerings over the Internet, however I don’t think this will be any real threat to purchasing agents for full service properties in the near future.
What are your expectations for the market?
We expect the market to remain strong into early 2018. Big question mark after that.
Do you have any basic advice you would give someone just starting out, a sort of Procurement 101?
If you are interested in being a purchasing agent, you need to be efficient, creative, have the real ability to multi-task, and go to work at one of the older companies where you can learn the ropes. If you are a hotel owner and want to maximize your opportunity of savings and success, you should hire a purchasing agent.
Is there anything I didn’t ask but should have?
You didn’t ask about education. There is a serious lack of attention to purchasing at all of the hotel schools in the country. I haven’t checked lately but previously there was not a single class focused on purchasing at any of the top schools, let alone a minor or major. Maybe the Hotel Schools believe in magic.
ABOUT THE FIRM
The Parker Company (TPC) provides project purchasing to its customers. Their proprietary technology, Llinx, gives clients, suppliers, shippers, and installers an interactive purchasing system that coordinates all project activities from budgeting through purchasing, expediting, and installation.
TPC has worked with all major hotel chains in addition to independent hotels, resorts, and arenas, and has completed international hospitality projects at every quality level. They offer managed project procurement, FF&E, OS&E, and consulting, and sports & events procurement.
For more information, visit www.parkerinternational.com.