Stephanie Ewing, RD, SNS
Vice President, Gold Star Foods
CASBO Annual Conference
April 16, 2016
THESE MATERIALS HAVE BEEN PREPARED BY THE CASBO CHILD NUTRITION PROFESSIONAL COUNCIL.
THEY HAVE NOT BEEN REVIEWED BY STATE CASBO FOR APPROVAL, SO THEREFORE ARE NOT AN OFFICIAL STATEMENT OF
CASBO
School
Board
Food
Service
Director
School
Procurement
Purchasing
Director
Chief
Business
Official
School Board
Chief Business
Official
Food Service
Director
Purchasing
Director
Good Food
Procurement
Model
Limit
Compliance with
Regulations
encroaching on
School’s General
Fund
Seamless and
simplified
purchasing
process
Promote
successful
program to
parents and
community
Compliance with
Regulations
Feed kids food
they want to eat
No Protests
Food Safety
Good Food
Procurement
Look good to
their boss
Compliance with
Regulations
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
Review USDA Policy Memo SP 04-2016
Focus areas that states may use as a guide
◦ Compliant Code of Conduct
◦ Written procurement procedures
◦ Correctly using Informal and Formal procurement
methods
◦ Needs and evaluation clearly identified
◦ Monitoring
◦ Allowable purchases
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







Purchasing Cooperatives
Commodity Cooperatives
Individual Bids
Manufacturer Bids
Distributor Bids
Multi-Category Bids
Line Item Bids
Piggybacking
No Procurement (???!!!)

Micro-purchase

Informal Bid Process

Formal Bid Process
◦ Invitation for Bid
◦ Request for Proposal
FARM
PROCESSOR
DISTRIBUTOR
SCHOOL
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Food Safety
USDA Foods
Disaster Preparedness and Food Recalls
Good Food Procurement
Technology
References
Customer Service
Operations
Value Added
Vendor
Total Bid Amount
Awesome Produce
$892,433.50
Spectacular Produce
$1,163,585.73
Wonderful Produce
$1,168,198.64
Amazing Produce
$1,411,377.98
Distributor A
XYZ product case cost = $15.00
$15.00 @ 15% mark-up = $17.25
Distributor B
XYZ product case cost = $15.00
$15.00 @ 11% mark-up = $16.65
Cost difference to the School is $0.60
Let’s look at the total contract cost:
Distributor A
School spends $300,000/yr on food
$300,000 @ 15% mark-up =
$345,0000
Cost difference to school is $12,000
Distributor B
School spends $300,000/yr on food
$300,000 @ 11% mark-up =
$333,000
Distributor A
XYZ product case cost = $15.00
$15.00 @ 15% mark-up = $17.25
Distributor B
XYZ product case cost = $17.00
$17.00 @ 11% mark-up = $18.87
Distributor B’s product is more expensive by $1.62 even though their mark-up is
4% less.
Let’s look at the total contract cost:
Distributor A
School spends $300,000/yr on food
$300,000 @ 15% mark-up = $345,0000
Distributor B
School spends $350,000/yr on food
$350,000 @ 11% mark-up =
$388,500
Working with Distributor B is more expensive by $43,500 even though the markup percent is 4% less.
Food Item- Canned Peaches 6/#10
Price per Case
Distributor A- Domestic Canned
Peaches
$39.17
Distributor A- Imported Canned
Peaches
$28.22
Distributor B- Canned Peaches
$22.95
If the original % mark-up is 10.8% and they
want to increase the mark-up by 2.8% the
calculation would look like this:
10.8% x 2.8% = .30%
10.8% + .30% = 11.1% (new mark-up)
Stephanie Ewing, RD, SNS
Vice President
Gold Star Foods
909-843-9600
[email protected]