Commercial Decisions Are Capital Decisions

By Mike Westendorf, Vice President of Finance, Teys USA

Most people think competitive advantage comes from buying lower than everyone else.

In my experience, that’s only part of the story.

The businesses that outperform over time aren’t always the ones that predict markets better. More often, they’re the ones that create more predictability inside their own operations. They know what they’re buying, what they’ll pay, and when they’ll receive it. That certainty allows them to make better decisions everywhere else.

That’s where working capital becomes more than a finance metric. It’s a reflection of how a business plans.

In imported beef, the time between committing to product and getting paid for it is long. A transaction can easily span months from production through shipping, distribution, delivery, and collection. Along the way, every decision affects cash, inventory, and risk. One disruption at the wrong time can add weeks to the cycle and create costs that never appeared in the original purchase price.

The common assumption is that the goal is to buy at the lowest possible price.

The reality is that the lowest purchase price and the lowest business cost are not always the same thing.

A product purchased at exactly the right market price can still become expensive if it arrives late, requires expedited freight, creates inventory gaps, or forces operational changes elsewhere in the business. What looks like a procurement win on paper can create costs that show up in other places.

That’s why the strongest buyers focus on predictability as much as price.

The Hidden Value of Certainty

For restaurant operators, protein isn’t simply another commodity. In many concepts, it’s the center of the menu and a significant driver of revenue. When supply becomes uncertain, the impact quickly extends beyond procurement. Forecasts become less reliable. Margins become harder to manage. Operating plans require adjustment.

Predictability creates a different outcome.

When a business can confidently forecast protein costs and supply availability months ahead, budgeting becomes more accurate. Expansion decisions become easier to evaluate. Operators spend less time reacting and more time executing.

In other words, predictability reduces friction.

Some restaurant groups have embraced longer planning horizons and contract pricing not because they expect to beat the market every time, but because they value the ability to forecast with confidence. A cost they can plan around often creates more value than a lower cost they can’t depend on.

Why Lead Time Creates Options

One of the biggest misconceptions in supply chains is that planning reduces flexibility.

In reality, planning creates flexibility.

With adequate lead time, suppliers have more options for sourcing, routing, inventory positioning, and transportation. Buyers have more options for pricing strategies, promotions, menu planning, and inventory management.

As the planning window shrinks, those options shrink with it.

At that point, businesses are no longer making strategic decisions. They’re making reactive decisions.

The question isn’t whether market conditions will change. They always do.

The question is whether your business has enough visibility to respond to those changes from a position of strength.

What the Best Buyers Do Differently

Across the customers we’ve worked with, the most effective planning practices tend to have three things in common.

First, they identify the products that matter most to their business and protect those first. Not every item requires the same planning horizon.

Second, they share forecast information earlier. Visibility allows both sides to make better decisions and creates more options when conditions change.

Third, they view supplier relationships as a source of market intelligence, not simply a transaction. Information flows both directions, and that information often becomes valuable before the market recognizes a change.

None of these practices guarantee a lower purchase price.

What they create is something more valuable: consistency.

The Competitive Advantage Most Businesses Overlook

Markets will always be volatile. Supply chains will always face disruptions. No company can eliminate uncertainty.

But companies can decide how much uncertainty they bring into their own business.

The organizations that consistently perform well are often not the ones making the boldest market bets. They’re the ones building systems, partnerships, and planning processes that allow them to operate predictably when others are forced to react.

That’s why commercial decisions are capital decisions.

And increasingly, predictability is a competitive advantage.