Food Procurement Program Presenter: Katie Schmitt Southeast Service Cooperative Cooperative Purchasing Technician September 2013

Food Procurement Program Overview Legal Requirements for Food Procurement Cooperative’s Role and Responsibilities RFP Process and Timeline RFP Document Review Program Benefits for Members School’s Requirements Next Steps September 2013

Food Procurement Program Minnesota Service Cooperatives 8 regional cooperatives 50+ statewide purchasing contracts Categories: Office Supplies & Equipment School Supplies Buildings & Grounds Athletics Technology Digital Learning Vehicles www.purchasingconnection.org September 2013

Why are we developing a food procurement program? Service cooperatives in western half of the state have had a program in place for years. It is time to Request for Proposals (RFP) for the 2014-2015 school year. We now have an opportunity to build a statewide program through Minnesota Service Cooperatives (MSC). As part of the MSC RFP, service cooperatives have access to experienced bid facilitators, contract negotiators and nutrition experts. Many districts conduct their own RFP or quotes. We can reduce duplication of work through a combined RFP and free up time to focus on important tasks. Pooling resources and buying power will create better leverage for pricing and product availability. We want to support you in providing quality, nutritious food for students. September 2013

What to Expect from your Service Cooperative Honesty & Transparency Regional Support Research Innovation Communication Collaboration & Organization Expertise Our members come first… always! September 2013

Legal Requirements for School Food Authority (SFA) Food Procurement The SFA Food Procurement process is defined by the USDA and the State of Minnesota in Federal laws and State Statutes. Conduct formal Bid/RFP to select supplier SFA spend $100K + Conduct weekly quotes and retain record for one year SFA spend under $100K September 2013

Bid/RFP Guidelines for SFA’s at $100K in spend The RFP/bid process must include all suppliers serving their area. 1 The RFP/bid cannot be written by a potential respondent. 2 The RFP/bid cannot be written in such a manner that it favors one supplier. 3 September 2013

Bid/RFP Guidelines for SFA’s at $100K in spend The primary foundation of the award must be price. 4 The RFP/bid may be conducted by a consortium, provided the consortium is made up solely of SFAs. 5 If a SFA utilizes a purchasing group, that purchasing group supplier must have been selected by utilizing the formal RFP/bid process. 6 September 2013

Meetings with Brokers and Suppliers Write RFP to select a primary distributor(s) Total volume will drive discounts Broker knowledge of RFP important for best pricing Expect healthier products – whole grain, low sodium, gluten free... Summer 2013 Met with 17 different brokers & suppliers September 2013

Meetings with Food Distributors Summer 2013 meetings: Apperts, Cash WA Distributing, FSA, Indianhead, Reinhart, SW Wholesale, Sysco, Upper Lakes Foods, US Foods, and Variety Foods. Knowledge gained: Delivery size and location effect cost. Requiring a sales representative to visit onsite to take the order increases cost. Request to delay the RFP deadline due to obtaining price concessions over the holiday season. September 2013

MSC RFP 14.1 Food & Kitchen Supplies DRAFT MSC RFP 14.1 Food & Kitchen Supplies Key items in this draft include: A “Top Selling Items” List Distributors would be asked to request price concessions from the suppliers based upon the anticipated volume of these items A “Delivery Fee Per Case” This would be applied to all items a distributor inventories that are not on the “Top Selling Items” list. Landed Cost + Fee = Member Price. September 2013

MSC RFP 14.1 Food & Kitchen Supplies DRAFT MSC RFP 14.1 Food & Kitchen Supplies Volume incentive program rewarding program usage:  % of annual spend purchased from the awarded vendor  average size of delivery  combination of the two Option to propose “tiered” pricing based on anticipated order size and/or location Awards could be made regionally or by school clusters that may span cooperatives’ borders Propose “Brown Box” Commodity delivery program Option to propose a surcharge for requiring sales reps to take food orders onsite or a discount for placing orders online September 2013

DRAFT MSC RFP 14.1 Food & Kitchen Supplies Product Samples MSC reserves right to request samples from distributors for testing Establishing Food Service Advisory Develop/refine RFP documents Assist in reviewing proposals received Test Products, as needed September 2013

Food Procurement Program Timeline: This past spring, a notice was emailed to schools for the RFP for Food and Kitchen Supplies in FY 2014. Over the summer, MSC met with food brokers and distributors to gain insight on what they needed to be able to provide low pricing and competitive proposals Schools to submit top 50 items they purchase by October 1, 2013. Schools will receive a survey by October 15, 2013 to estimate FY2015 product usage. Responses are due by November 4, 2013. (Not bound to estimated quantities.) Schools wishing to participate in the program will need to sign a Letter of Commitment and return it by November 4, 2013. Food Procurement Program September 2013

Food Procurement Program exact dates TBD Timeline: The RFP will be written to include top items purchased by participating schools Oct-Dec 2013. RFP documents will be published and distributed to potential vendors in January 2014. Vendor proposals will be due in February 2014. Proposal evaluations will be completed and award(s) will be made by the end of March 2014. Participating schools will be notified of the award(s) in March/April 2014. Food Procurement Program exact dates TBD Nov-18

Schools: Responsibilities Submit Top 50 Items form by October 1 Complete Top 300 survey by November 4 to estimate quantities Sign Letter of Commitment by November 4 Participate in the vendor selection process Purchase a certain percentage (TBD) of food and kitchen supplies from the awarded vendor during the 2014-15 school year (excludes milk, bread, and other items not available from the awarded vendor) Provide feedback throughout the vendor’s contracted term Schools: September 2013

Responsibilities Service Cooperative: Communicate the RFP/bid program and progress to school superintendents, business managers, and food service directors Collect Top 50 Items and coordinate Top 300 survey Compile Top 300 quantities for participating schools Write the RFP to reflect participating schools’ needs Publish the RFP and distribute to potential vendors Collect proposals, compile results, check references, cost/value analysis, and perform product testing Coordinate vendor presentations; vendor selection based on RFP criteria Develop contract terms with selected vendor(s) Provide participating schools with program details (how to order, pricing, six week cycle menu, etc.) Monitor vendor(s)/program to enforce contract terms Provide regional support for schools Service Cooperative: September 2013

Food Procurement Program Benefits: Significantly reduces the amount of time spent on bidding and quoting Access to a six week cycle menu to help with meal planning Conforms to the State of Minnesota bid laws and the US Department of Agriculture food program procurement requirements Offers better pricing and reduces delivery charges by leveraging multi-district buying power Improves access to high-quality products by creating a customer network that is attractive to distributors Increases communication and builds relationships among food service professionals Provides access to statewide food procurement resources, training opportunities and expertise Food Procurement Program September 2013

Next Steps for Schools Discuss the new Food Procurement Program with decision makers at your school Consider serving on the Food Service Advisory Committee Complete Top 50 Items by October 1 Complete Top 300 Survey between October 15 -November 4 Complete and Sign the Letter of Commitment by November 4 (we will send this out ahead of time for your review) September 2013

Food Procurement Program Updates will be posted at: www.ssc.coop September 2013

Questions? Contacts: Katie Schmitt SSC Program Technician 507.281.6676 (office) 507.251.6211 (cell) kschmitt@ssc.coop Doug Koch MSC Statewide Food Bid Facilitator 800.739.3273 dkoch@lcsc.org September 2013