Start Supply Planning Before You Sell Franchises With Lee Plotkin

This is a recording of a live webinar recorded on August 28th, 2026, starting at around 1:00 PM Eastern Time USA.

This week on the Franchise Your Business webinar series, we were joined by Lee Plotkin, President of L.P. Enterprises, Inc. (LPE).

Since 2001, Lee has helped restaurant groups build stronger purchasing and supply chain systems that reduce costs, improve efficiency, and support sustainable growth. Through decades of experience, he has worked with businesses to create the operational foundation needed to scale successfully.

In this session, Lee shared why supply chain planning should begin before franchise expansion, how to build supplier and distributor relationships that grow with your business, and why a strong purchasing infrastructure creates a competitive advantage for both franchisors and franchisees.

• Connect with Lee Plotkin:
  • Website: https://www.leeplotkin.com
  • LinkedIn: https://www.linkedin.com/in/lee-plotkin-2a27a96
  • LP Enterprises on LinkedIn: https://www.linkedin.com/company/lp-enterprises-inc

Ready to talk about franchising your business or get help with your franchise efforts? Book a complimentary consultation with one of our consultants: https://bigskyfranchiseteam.com/consultation-routing/#call

This episode is powered by Big Sky Franchise Team.
Big Sky Franchise Team is consistently recognized as one of the best franchise consulting firms in the United States, helping entrepreneurs franchise their businesses through a proven 3-Step franchise process rooted in ethical principles, hands-on guidance, and customized deliverables.  If you are ready to talk about franchising your business you can schedule your free, no-obligation, franchise consultation online at: https://bigskyfranchiseteam.com/. 

The information provided in this podcast is for informational and educational purposes only and should not be considered financial, legal, or professional advice. Always consult with a qualified professional before making any business decisions. The views and opinions expressed by guests are their own and do not necessarily reflect those of the host, Big Sky Franchise Team, or our affiliates. Additionally, this podcast may feature sponsors or advertisers, but any mention of products or services does not constitute an endorsement. Please do your own research before making any purchasing or business decisions.  References to external data sources, studies, statistics, or other third-party content are not claimed as our own unless explicitly stated. We do our best to provide proper credit and citation where due. If we unintentionally fail to cite or credit a source, please let us know, and we’ll gladly ...

Transcript

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Welcome And Why Purchasing Matters

Tom DuFore 0:02

All right, everyone, thank you again for joining us on another edition of our Franchise Your Business podcast and webinar series. My name is Tom Dufour, and I'm the founder and CEO of Big Sky Franchise Team. And if you're new to us here, this session is designed to help give you practical insights and uh uh practical insights and how-to's to be better as a business and a franchise company. And today's no different. So you're gonna have to wait to learn a little bit more about that. Before we jump into our topic and guests today, we I would love for you to please subscribe to our podcast, Franchise Your Business Podcast on your favorite podcast service, or subscribe to our YouTube channel if you uh prefer YouTube. Go to our channel at bigskyfranchise team.com where you can get regular updates and watches. And uh for those that are tuning in or familiar with some of our other content, you can subscribe to our second podcast called Multiply Your Success. Now, with that being said, I would love to introduce our guest today uh that's going to give us uh really great insight on purchasing. And I'll get into that here in just a little bit. But uh our guest today is Lee Plotkin. And Lee is the uh owner of uh LP Enterprises that helps small and medium-sized restaurant groups streamline purchasing with precision, insight, and proven expertise, saving time, reducing costs, and setting up the supply foundation for successful growth since 2001. So for more than 25 years here. And that's exactly what Lee and I are going to be talking about here uh is really talking about this supply chain that's essential. So, Lee, welcome to the show.

Lee Plotkin 1:59

Well, thank you so much, Tom. It's it's a pleasure to be here and pleasure to hopefully uh have a chance to share some uh important information with your audience.

Why Planning Early Wins

Tom DuFore 2:10

Yeah. Well, one of one of the things that um just starting maybe at a at a high level here, and maybe it's not so such a high level, but with with what you offer is really talking about this idea of why supply chain planning, why that's important, and you know, maybe then going right into when's a good time to start even talking about it, like listening to an episode like this.

Lee Plotkin 2:37

Yeah, uh great questions. So, why it's so important to start early, there's a number of reasons. Uh, I always look at it from a purchasing agent standpoint, anyways. And I always think the earlier you can get the the purchasing team involved in any kind of process, the more visibility you're gonna have into the market, the better opportunity to get great pricing, uh, streamline product uh availability and things of that nature. When you're specifically talking about uh building out a system for franchise growth, um it it's become my experience that it's incredibly important to start early. Uh, for example, um, if you're looking to bring on new franchisees, if you're early in that development process, you know, we typically like to get involved as soon as we can to be able to build out that structure in a cost-effective uh manner and establish good foundational programs. The financial foundation is one aspect, and then making sure the right people are in place from the supply team, uh, that distributor to facilitate growth. If you've got a great rep, then you've got a great uh program and a great company that's taking care of you. We like to jump in early in that process, and we can also get into some of the whys and the hows uh of doing that and what we're doing right now for a couple of uh franchise operations.

Tom DuFore 4:15

Sure.

What Supply Chain Planning Means

Tom DuFore 4:16

Well, Lee, I I realized here, I I want to take a step back and have you helped define what this planning is. So what what it what is supply chain planning? I guess I should have started there. That should have been my first question. Yeah. Uh so let's start there.

Lee Plotkin 4:34

Yeah, so great question. So so supply chain planning, uh, especially when you're looking at at growth, is is look first of all, looking at the the products that you're you're using, uh and and making sure you've got the quality products in place. And so now you know uh your supply person can go back to the manufacturers and start negotiating manufacture deals. Um, when you're talking about um your distributor programs, we want to make sure that you're able to consolidate as much as is feasible on a broadline truck, or if you need a dedicated produce deliver uh distributor, then how does how do you put that in place where that program can grow across the country? So everything that we do is with an eye to how do we reframe things uh to get product across the country as your concept grows. The earlier the you can do that, the better. Give you an example for uh one of our uh recent clients uh has two locations in the Midwest and is bringing on new franchisees. They just signed up a uh a franchisee agreement for five locations. So we've got about eight, nine months before um that brick and mortar store is open. So we're gonna consolidate product. Uh the the framework is pretty fragmented right now. So we're looking to consolidate product. We're bringing on a chemical program that's going to streamline things so you have contract pricing around the country.

Fixing Fragmented Vendors Through Consolidation

Tom DuFore 6:16

Can I I'm sorry, I'm sorry to interrupt you here. Um can uh and this may just be my uh lack of some of the fine details of understanding your your business. So when you when you were talking about with this example with this franchisee that bought in a new multi-unit uh operator, uh this this is a food service business, right?

Lee Plotkin 6:36

Is that okay it's a restaurant, it's a restaurant, yes, it's a restaurant, and we're actually working for the franchise.

Tom DuFore 6:43

Okay. And so when you say it the the product or such is is fragmented, what what what's included in these fragmented pieces? What does that mean? Is it the actual food? Is it the paper goods? Is it uh like you know what what's what's part of that?

Lee Plotkin 6:59

Yeah, great question. Thank you for for taking me a step back in that in that conversation. So so you're absolutely right. So this particular client is buying most of their food product from a broadline distributor. Their paper goods, their chemicals are coming from a paper company. They're getting uh some products from a local specialty supplier, and there's a couple of those specialty suppliers, and there's a produce company in the mix as well. So now we're we're taking that process and we're asking the questions: what belongs where? What belongs on the broadline distribution truck? Now we can maybe get manufactured deals for paypal and disposables. We can increase that supplier's uh delivery size, if you will, and we can reduce their margins uh accordingly and still make it profitable for that supplier. So now you have a program that might be more attractive financially to um potential franchisees as you grow, and you're looking at margin improvements right off the bat, you're uh lowering delivering fees, you're reducing startup risks, and you have day one buying power. The fact that we're starting early in those processes allows us to uh structure that framework and get the right people in place.

Tom DuFore 8:23

So, so then Lee, for for this example, are you when you get involved? Uh is it you're you're kind of acting as a uh if I understand correctly, I want to make sure I'm understanding this correctly, almost like the purchasing manager or uh buyer's or a uh the buyer's agent for whether it be the franchise or in this instance, maybe some franchisees that engage with you independently, and then you're essentially helping them uh streamline and figure out the most cost-effective way to get the products that they or goods that they're looking that that they would normally be using anyway.

Lee Plotkin 9:03

That that's exactly right. So, okay, so we are an outsourced department for them. We just don't carry the burden and the high cost of having someone full-time, especially at this stage of their growth. Um, and and we're we have that visibility and that experience to be able to step back and say, okay, let's customize this based on what your needs are, how to get product across the country. Do we want to uh entertain conversations with your distributor to consolidate? Are you at a point uh in your maturity where we can actually take this program out to bid and structure it the financial foundation that way? Uh for this particular client, we want to structure the programs first and build that volume and build that infrastructure before anything would go out to bid. So we're customizing things, we're turning it around a little bit differently, and then we're gonna look at produce programs. How do we have the same products across the country? Can we contract products with the growers uh that reach each one of those supply companies? What belongs on the produce truck? Are there specialty products that we could possibly add that that Cisco won't carry? And those are some of the conversations that we're we're having right now surrounding that.

Cost Savings That Change Cash Flow

Tom DuFore 10:28

Great. So then one of the things uh I I think about is uh what you mentioned before uh uh about it really trying to give a cost savings to the ultimately to the franchisee in this instance or in and the franchise space where the franchisee would be have a saving. Do you do you is there a uh it, you know, I the food business always has tight margins? Uh it just it's always tight margins, and any way you can save a a little bit here, a little bit there starts to add up by managing this thing and being a little proactive on it. So is there a typical range that you see cost savings fall within for what you're able to do? Is it hard to, you know, I don't want to put you on the spot and say, well, you know, I would, yeah, that's a great question.

Lee Plotkin 11:17

And and you know, I've been asked that so many times, and and there's no way to truly quantify that, but you know, you can look at even dropping uh 2% uh in your your food and packaging costs uh dramatically improves a new franchisee's cash flow their first year. I I don't think those are unrealistic numbers when you're looking to um either consolidate or take that program out to bid. I've seen greater and we've seen a little bit lower, but 2% um really makes a big difference and impacts your franchise community and your upcoming partners.

Tom DuFore 11:59

Well, I I think it's interesting because I think you know, my viewpoint is that for the the franchise's job, it part of their job is to uh I always encourage clients and franchisors to think about how you can help your franchisees find savings through uh whether it be bulk purchasing, economies of scale, or having the ability to work, for example, with a group like yours and others, where if it to try, I'm always thinking as from the franchiseor mindset, I'd love to try to get the savings to my franchisee such that it essentially offsets the payment of the royalty so that so that that royalty becomes a non-issue with the savings and maybe even in an ideal scenario do better. So you're part you're part of this, I think, solution.

Lee Plotkin 12:54

Absolutely. So we do that with that's that's what we're we're we're we're structuring through these bid outs, or we're creating that that platform for that ROI to come back to their franchise community in a real effective

Proprietary Products And National Distribution

Lee Plotkin 13:08

way. And um another big aspect in that whole equation is how do you get product across the country if you have proprietary product, if you have custom blended seasonings and marinates, how do you do that effectively without impacting their bottom line? And so what we have found, be happy to share with you and your audience is we typically start with um a redistributor called dot foods. If you're familiar with them, I'm not quite sure if that name rings a bell. They are the largest redistributor of product in the country. And we'll go back, for example, with this uh franchise or who had uh custom seasonings, marinate, and we asked the question who in your manufacturer portfolio uh is has the ability to do custom seasonings that have low minimum order quantities? If we can have them produce one pallet and put it into the dot system, then we can average out freight across the country for all of their uh supply, uh their their franchisees. And all the Cisco's, the US foods out there, the GFSs, the performance food groups can buy one to two cases a week from these um redistributors. So not to get too much into the detail there, but it was on my bullet points to be able to bring up to be and help your community talk about how do you get that product across the country, how do you overcome those geographic challenges in a real cost-effective manner. To your point, Tom, that hits the franchisees' bottom line and brings more ROI back to cover those royalty costs.

Tom DuFore 14:59

Well, uh what you just shared makes me think a little bit about uh some clients I've worked with over the years that have some kind of a unique or proprietary product offering. And uh it always seems to be a pain point when maybe let's say this uh restaurant is franchising and they're in a specific region, and the supplier they find just happens to be local, and geographically they could maybe go a hundred miles or two hundred miles, no problem. But now all of a sudden you're starting to expand out of that zone, and there's this proprietary uh product. And I I remember years ago I had a client in the uh that had uh uh custom uh it was a meat type that that he had custom made for uh I think it was a Philly steak sandwich that he he made at his restaurant. Um, and he had to kind of source and figure out all of these, you know, way locally it wasn't a problem, but as he started expanding nationally, it became more of a more problematic. And I've seen instances where clients have had a proprietary product and the once uh let's just say, for example, someone's in the northeast and now they're opening in Texas, and then they've got and and now that they say, Oh wow, my cost has tripled because my supplier has to ship it or try to keep it cool or cold or frozen. Um so talk through how you work with these unique or proprietary uh products or even seasonings, sometimes seasonings and sauces that I hear clients talk about.

Lee Plotkin 16:40

Yeah, yeah. So great, great questions. So we'll we'll use this particular client uh as an anonymous example. And and so with their seasonings now cut through our introduction to these manufacturers, um, and we have a contact at dot foods that we actively work with. Um, we can identify potential partners who now can sign NDAs and uh the customer can share recipes and now they can start the RD process. Uh that's a that's gonna take several months to go through. And during that time, if the product works out well, we can talk and negotiate about pricing, flat pricing across the country. And so uh as long as those customers are able to get a product with enough shelf life on it to be distributed around the country, for example, dry or frozen, now those products can be redistributed to the Cisco's around the world, the the country. We also look at um branded products, paper and and disposables, because that's something that is so key and important to franchisors. If what do uh potential customers out there in the market see when your product leaves? Is it the bag? Is it the the the logo cup? Um, do you have a uh a bowl that has your branding on it? Um what are they actually looking for that that identifies your concept? And so now we get a chance to go back to ask those questions with either the paper company um or uh dot foods manufacturers and and start that process again. Um and again, the the goal is to get the right product at the right price and make that price a flat price across the country so that if you're in the Northeast, like you said, and you're opening in Texas, your Texas franchisee is not adversely impacted by high cost. If you have flat pricing, it makes sense for everybody and they feel it's fair and equitable.

When Locations Are Scattered

Tom DuFore 18:59

So one of the things that I've seen happen, uh my career's been spent working with emerging franchisors and emerging franchise brands. And as uh the idea in general, the ideal best kind of strategy is to grow close to home, if you can, in kind of concentric circles, I ideally. Um now then reality hits, and uh a family member or an old employee relocated out of region or a long-term customer that you know, if you maybe there's a restaurant in Florida and uh somebody relocated and now they live in Ohio or they live out in Wisconsin or something, and say, I love your business. I've always wanted to open one of these and I'd love to run one here. And uh now they they get that up and and going. And so now you have, you know, maybe five or six restaurants and they're kind of scattered about. So, how how do you help a brand that might find themselves in that situation where you don't have this concentration in one particular area, or does that not even matter? It just kind of got me thinking about it.

Lee Plotkin 20:06

No, no, no, it it matters a great deal. So um it it's something that I think is now becoming part of a lot of franchise owners' conversations. And to your point, you're gonna have uh the onesies and twosies that pop up in different parts of the country. Uh so understanding that the more you're able to saturate a market, the the better economics you're gonna have, the better ability to get product across the country. Um, so when those kinds of questions come up, it it's a great time to entertain conversations with your distribution partner once you level set that foundational piece and talk about where you're looking to open and identifying what products are truly important to uh to your brand uh and and what's realistic. At that point, you may have to identify some alternative products that this lone wolf can be using, if you will, um in Texas and in the Texas market until that saturation occurs. Um or using um Hormel bacon, if you will. Everybody stocks Hormel bacon, for example. Um, if you have a breakfast and lunch concept, you know, is it is it time to look at um a product that the Cisco or US foods or your distributor stocks across the country, that it's a national branded product. Um we look at it as what's a realistic alternative, and we try to get way ahead of that that that foundation. Um if we have to sometimes, and if it's a dry product or if it's a paper product, um, we can do auto shipments. And those can be you know through dot foods or from a From a manufacturer to the distributor, but that adds cost to the equation. Um, but it's a but it's a conversation that happens quite a bit now. Uh I know with this particular customer, uh they have five units that were sold, and and three are gonna be in one area and two are gonna be in another area. So they're starting to build out those areas for future growth, knowing that they're only gonna open with one. Um and and then those locations have to be in close, uh they are in close proximity to the franchise locations, but they're gonna run into that situation, and we're gonna have to approach that as we as we get closer. Great, great questions, great points.

Tom DuFore 22:45

Very

How To Get Help And Next Steps

Tom DuFore 22:46

good. Well, uh Lee, something uh just as a uh, I guess a question uh for someone that that ends up listening in, you know, how does this process work, you know, for a franchise or maybe a franchisee listens to this and their franchise or is not signed up, but they're looking for some support. Uh, can you work uh I guess let's start with that franchisee. Can you help that franchisee on a one-off basis, or does it really need to run through the franchise or?

Lee Plotkin 23:12

Well, it has to run through the franchise or we're always there to give uh information, happy to share and pay things forward. Um, the franchise or has the um uh the contractual uh arrangements to uh um have the specs in place and and who that franchisee is going to be using. So the benefit will be to the franchisee. So typically our work is with the franchise or we we start as early as one, two locations that start having the conversation, and then um you know we go up from that point. So this franchise or has two locations, and and now we're building out the infrastructure for for that for that company to be able to grow effectively. So really um we're we're happy to have those conversations at any point in the the franchise ore's growth. If a franchisee has questions, we're always going to refer them back to the franchise or to make sure that things are in contractual compliance, but we can also give them some um questions to ask uh and be able to guide them if they're running into some situational problems.

Tom DuFore 24:26

Great. And for that franchise or Lee that that listens into this or hears what's going on, someone says, okay, uh Lee, you caught my attention. I've got an interest in at least starting a conversation or learning a little bit more. Uh, what are the steps? What should somebody do?

Lee Plotkin 24:42

Well, the first thing they could do is reach out. Uh just uh reach out and and you know, the information that that they probably want to have is, you know, how many locations do you have now? Um give us an idea of what your annual volume is or your annual uh food and beverage sales and your food costs. We can back it back it out from there and we can start a conversation with that um that franchiser at whatever stage they're at. I'd be happy to share my cell number uh on this call if if that was of interest to uh to you uh and my my email. And I think you guys will have that on your your your uh podcast. Is that correct?

Tom DuFore 25:27

Yeah, yeah. We can we'll make sure we list your contact information. And is there what's the best website for someone to go to that they might be able to pull up? And we'll include that in the show notes also.

Lee Plotkin 25:37

Yes, it's my name, uh www.leplotkin.com. Perfect.

Tom DuFore 25:45

Perfect. Um, well, Lee, uh, I I guess as uh as we're uh drawing near to a close here, is there anything you really want to make sure that you were able to share or get across that you haven't had a chance to yet?

Lee Plotkin 25:59

Yeah, I I I mean I just read would reinforce you know several things. I uh you know, establish that core foundation for yourself. Uh if you're um a franchise or you want to lock your specs in early, what's very important to your brand and how much can be consolidated realistically and at what point in in your growth? I think those things, if you if the franchise or starts with those key points, uh I think that's a really good basis. And they'll become able to come up with some good questions for the next steps.

Tom DuFore 26:36

Perfect. Perfect. Well, Lee, thank you so much again for being here. And as you said, it's Leeplotkin.com to contact and get some information, at least get a conversation started. Uh, we will share that in the show notes. And for those of you listening in live, or we would will have this published shortly on our podcast and YouTube channel. And Lee, just want to say thank you so much again for being here and for sharing this information today.

Lee Plotkin 27:05

Yeah, my pleasure, Tom. Thank you so much. I appreciate it. Hope you and your audience have a great day.

Tom DuFore 27:11

Thank you. And thank you to everyone for tuning in. Uh, we appreciate your time and we look forward to having you back on the next one. Thank you so much. Have a great day.