(May 19, 11:22 a.m.) LAS VEGAS — It is a food and beverage shopping list that would stagger the kitchen staff at even the largest restaurant. It requires the issuing of 10,000 purchase orders every month. The tab for 2007 approached $75 million.

But it’s just business as usual at the Las Vegas, Nev.-based MGM Grand and two of its sister resorts, New York, New York and Signature.

“To put things in perspective, the number of bacon strips we buy every year put end-to-end would reach from Las Vegas to Cleveland, Ohio,” said Tony Reiss, executive director of the company’s purchasing department.

Reiss permitted a rare behind-the-casinos look at the hotels’ food and beverage hub during the recent United Fresh 2008. The high-tech sophistication found in a Nevada resort’s gaming operation is challenged by the equally sophisticated systems found in the MGM Grand’s warehouse-receiving and kitchen departments.

“We require the vendor to barcode and date every case of every commodity we receive,” said Michael Vadney, director of warehouse operations for the three resorts.

Matching labels with bar codes are affixed to the massive storage shelves throughout the central receiving warehouse and cold rooms at the MGM Grand. It is a well-oiled machine requiring nearly 70 employees in the purchasing and warehouse-receiving departments alone.

“The role of the purchasing department is to enable the operating departments to focus all of their resources on their core activities,” Reiss said.

That means, among other things, the purchasing department is not the final word in procurement.

“Every commodity is evaluated by the kitchen staff, not by the purchasing department,” Reiss said.

MGM Grand expenditures for food in 2007 totaled nearly $55 million. Of that total, fresh produce accounted for about $8 million — or more than 14%.


Price is just one dimension by which commodities are measured. A grower-shipper must meet the three hotels’ standards and their rapidly changing needs, Reiss said. The nature of the business is that many buying decisions must be made daily, and the vendor must be able to respond.

“We are in the ‘yes’ business, and we need suppliers that are, too,” Reiss said. “Of what value is the best produce or the lowest price if it cannot be delivered when we need it?”

The hotels receive 15,000 to 20,000 pounds of fresh produce daily, a food category that ranked behind only meat and seafood in 2007, Reiss said. Fresh vegetables accounted about $3.5 million of the food buys. Processed fruits and vegetables captured $2.2 million of the overall food budget, with fresh fruit purchases at $1.8 million.

Tomatoes, avocados, lettuce, asparagus and several varieties of mushrooms ranked among the most-purchased vegetables. Among the fruit commodities, bananas, melons, citrus varieties and apples captured the top 10 slots on the hotels’ 2007 shopping list.

Variety is nearly as important as are quality and price, as evidenced by the wine selection.

“We stock more than … 1,000 wines,” Vadney said.

The corporation also is developing a sustainability program for its fresh produce suppliers, a task that is easier said than done, Reiss said.

“First, we found we have to define sustainability,” he said.

The three resorts also are committed to a diversity program among suppliers. Since Reiss took over the purchasing department three years ago, the purchases from minority-owned and women-owned suppliers has increased from $9 million a year to $21 million a year, he said. It was performance and not ethnicity or gender that accounted for the increase.

“Every dollar has been earned,” Reiss said.

Quality, service trump price at Nevada resorts
A worker removes stem ends from tomatoes in one of the food preparation kitchens at the MGM Grand, Las Vegas. The three MGM Grand hotel-casinos purchased nearly $8 million of produce in 2007, says Tony Reiss, executive director of the purchasing department for MGM Grand.