Copyright © 2008 School Nutrition Association. All Rights Reserved. Welcome! To join the audio portion of the event, please dial in to the new number: 8oo (Please note that this is a NEW dial in number) Disclaimer of Endorsement: reference herein to any products, services or expressed ideas does not constitute or imply endorsement or recommendation by the School Nutrition Association. Note: Instructions on how to obtain 1 CEU credit for participating in today’s event will be provided at the conclusion of the webinar

Copyright © 2008 School Nutrition Association. All Rights Reserved. Dairy Procurement: How to Develop Bid Specifications & RFP’s for a Successful & Cost Effective Program Disclaimer of Endorsement: reference herein to any products, services or expressed ideas does not constitute or imply endorsement or recommendation by the School Nutrition Association.

Copyright © 2008 School Nutrition Association. All Rights Reserved. Objectives Develop cost-effective bid specifications & Requests for Proposal (RFP). Identify steps in developing a school dairy bid that explores many options Use Keys to Excellence as a framework to identify best practices in procurement of milk and dairy products. 3

Copyright © 2008 School Nutrition Association. All Rights Reserved. National Dairy Council A leader in nutrition research and education since 1915 Provides timely scientifically-sound nutrition information designed for school nutrition professionals, teachers and parents Generic promotions focusing on dairy Dairy producers and dairy processors 4

Copyright © 2008 School Nutrition Association. All Rights Reserved. Presenters Peggy Lee, National Dairy Council Teresa Nece, Facilitator Chad Mitchell, Director of Food Service Rock Hill School District, SC Beverly Blough, Director of Food Service Wood County Schools, Parkersburg, WV Melanie Konarik, Director of Child Nutrition Spring ISD, Houston, TX 5

Copyright © 2008 School Nutrition Association. All Rights Reserved. Procurement Decisions Ensure use of high quality and safe ingredients/products Availability, cost, acceptability and nutritive value have a strong role Based on scientific information, government regulations, cost, product quality, consumer demands, environmental constraints Practice that supports free and open competition In accordance with Federal, State and local requirements 6

Copyright © 2008 School Nutrition Association. All Rights Reserved. Importance of Nutrients Milk contains nine essential nutrients Food group to encourage Three of the five nutrients of concern: calcium, potassium, and magnesium DGAs emphasized low-fat or non-fat milk and milk product 2005 DGAs stated added sugar has a value in increasing palatability

Copyright © 2008 School Nutrition Association. All Rights Reserved. Importance in School Meals Milk required meal component Healthy eating patterns during childhood affect later years More milk choices than ever before 8

Copyright © 2008 School Nutrition Association. All Rights Reserved. Federal Law Requirements Richard B. Russell National School Lunch Act - 42 U.S.C et seq. Child Nutrition and WIC Reauthorization Act of P.L Reimbursable lunches must offer “fluid milk in a variety of fat contents” (minimum of 2) May offer flavored, unflavored, lactose- free

Copyright © 2008 School Nutrition Association. All Rights Reserved. Regulations –7 CFR Part 210 – school lunches –7 CFR Parts 3015, 3016 – procurement –Federal procurement regulations apply to all schools –State and local procurement laws/regulations may also apply - if consistent with federal –Have knowledge of any special requirements in your state –What does your local wellness policy require? Sugar and calorie levels Local or state standards 10

Copyright © 2008 School Nutrition Association. All Rights Reserved. Basic Decisions 1. Appropriate purchase method 2. Pricing mechanism 3. Number of vendors required 11

Copyright © 2008 School Nutrition Association. All Rights Reserved. Purchase Procedures 1. Request for Quotation – small purchase procedure 2. Competitive Sealed Bids – formal process 3. Request for Proposal – formal process 4. Noncompetitive Negotiation 12

Copyright © 2008 School Nutrition Association. All Rights Reserved. Developing Product Specifications Ask for flavors and fat levels in milk Ask for lactose free milk Include local or state standards Bid language specifies plastic or paper containers as options Develop specifications for other dairy products - yogurt, cheese Develop specifications for other items such as juice 13

Copyright © 2008 School Nutrition Association. All Rights Reserved. Pricing Mechanism 1. Fixed firm price for specified time period 2. Escalation/de-escalation clause tied to third party bulletin 14

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Copyright © 2008 School Nutrition Association. All Rights Reserved. Escalation/De-escalation Clause All prices shall be firm for 30 days, after which milk can increase to decrease in accord with changes in Class 1 raw milk prices based on monthly Federal Milk Order Announcements for the (applicable geographical zone). Prices for milk delivered can be increased or decreased at the rate of $0.001 per half pint for each full $0.15 increase/decrease in raw milk per hundred weight. Visit 16

Copyright © 2008 School Nutrition Association. All Rights Reserved. Making School Business More Appealing Number of deliveries Flexible delivery times Specify locations, storage space, etc. Set par order levels Specify temperature standards for milk Exchanges and credit procedures 17

Copyright © 2008 School Nutrition Association. All Rights Reserved. Rock Hill School District Chad Mitchell, MS, RD Suburban School District 25 Schools Enrollment 18, students/year 18

Copyright © 2008 School Nutrition Association. All Rights Reserved. Rock Hill School District Sealed Bid Product Specifications Price Escalator/De-escalator Plastic and Paper containers Contract Extensions Bidder Responsibilities Success Story 19

Copyright © 2008 School Nutrition Association. All Rights Reserved. Specifications Milk, 1% butterfat, minimum milk solids not fat 9%, US Grade A fresh, approved, pasteurized homogenized, Vitamin A and D enriched Chocolate Milk, Skim, minimum milk solids not fat 9%, US Grade A fresh, approved, pasteurized homogenized, Vitamin A and D enriched. No recombined chocolate milk 20

Copyright © 2008 School Nutrition Association. All Rights Reserved. Petitions for Price Escalation Basis of increases - cost of product raw material Packaging or transportation increases not allowed Increases supported by evidence of price increases Only be granted when the supplier can show cost of raw materials has escalated or de- escalated at $0.15 per hundred weight 21

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Copyright © 2008 School Nutrition Association. All Rights Reserved. District Decision 23 ProductContainer TypeUnit Volume Unit PriceEstimated Quantity Extended Price Chocolate SkimPlastic Bottle8 fl oz$1,111,320$ Paper Carton8 fl oz$1,111,320$ Vanilla 1%Plastic Bottle8 fl oz$79,380$ Paper Carton8 fl oz$79,380$ Strawberry 1%Plastic Bottle8 fl oz$79,380$ Paper Carton8 fl oz$79,380$ White 1%Plastic Bottle8 fl oz$158,760$ Paper Carton8 fl oz$158,760$ White SkimPlastic Bottle8 fl oz$158,760$ Paper Carton8 fl oz$158,760$

Copyright © 2008 School Nutrition Association. All Rights Reserved. Success Story 24

Copyright © 2008 School Nutrition Association. All Rights Reserved. Wood County Schools Beverly Blough, MS, RD, LD  Urban and Rural School District  27 Schools  Enrollment 13,414  Request for Proposals 25

Copyright © 2008 School Nutrition Association. All Rights Reserved. Wood County Schools Vendor Conference Bidder Responsibilities Product Specifications 26

Copyright © 2008 School Nutrition Association. All Rights Reserved. Product Specifications Milk in half pint (8 oz) plastic or paper containers: Low fat (1%) white milk Low fat (1%) chocolate flavored milk Low fat (1%) strawberry flavored milk Low fat (1%) vanilla flavored milk Low fat (.5%) skim white milk Milk Products Fruit Juice 27

Copyright © 2008 School Nutrition Association. All Rights Reserved. Low Fat (1%) Flavored Milk a.) Not less than 2000 USP units Vitamin A per quart. b.) Not less than 400 USP units Vitamin D per quart. c.) No less than 1% milk fats. d.) Shall be protein fortified and contain not less than 8.25% total milk solids non-fat. e.) Emulsifiers or stabilizers added shall not be more than 2% by weight of the total non-fat milk solids added. f.) Addition of approved flavoring. g.) Pasteurized and homogenized. h.) Limit total sugars to 22 grams per 8-ounce portion 28

Copyright © 2008 School Nutrition Association. All Rights Reserved. Wood County Schools Firm Price and Escalator/De-escalator Plastic or Paper Containers 29

Copyright © 2008 School Nutrition Association. All Rights Reserved. RFP Evaluation Meeting Nutrition Standards & Goals of District Variety of product available Product Quality Delivery Service Overall Integrity of Vendor Price 30

Copyright © 2008 School Nutrition Association. All Rights Reserved. Success Story 31

Copyright © 2008 School Nutrition Association. All Rights Reserved. Spring Independent School District Melanie Konarik, MS Suburban School District 31 Schools Enrollment 33,000 32

Copyright © 2008 School Nutrition Association. All Rights Reserved. Spring Independent School District Purchasing Cooperative Fixed Firm Price Nutrition Analysis Software Vendor Bid 33

Copyright © 2008 School Nutrition Association. All Rights Reserved. Harris County Department of Education (HCDE) Request for Proposal Product Specifications Firm Price Packaging type Responsible Bidder Responsibilities Success Story 34

Copyright © 2008 School Nutrition Association. All Rights Reserved. Evaluation Criteria 1.Price 50% 2. Meet HCDE/GCC Terms & Conditions 20% 3. Ability to meet needs of members 20% 4. Company References 10% 35

Copyright © 2008 School Nutrition Association. All Rights Reserved. Success Story 36

Copyright © 2008 School Nutrition Association. All Rights Reserved. In Review What type of purchasing system? What products are you offering? Have you written your product specifications? Do vendors know what you expect in the contract? Is your bid document up-to-date and does it meet federal, state and local requirements? Specific items to consider: Storage space in facilities Different pack sizes Expand dairy bid to include other products Type of packaging (paper or plastic) 37

Copyright © 2008 School Nutrition Association. All Rights Reserved. Resources 38

Copyright © 2008 School Nutrition Association. All Rights Reserved. First Choice: A purchasing systems manual for school food service, Second Edition National Food Service Management Institute 39

Copyright © 2008 School Nutrition Association. All Rights Reserved. Choice Plus: a reference guide for food and ingredients National Food Service Management Institute 40

Copyright © 2008 School Nutrition Association. All Rights Reserved Prime Purchasing Practices An introductory purchasing course for managers and directors based on First Choice concepts and Keys to Excellence best practice standards

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Copyright © 2008 School Nutrition Association. All Rights Reserved. Additional Resources State regulatory agencies Your local Dairy Council representative MilkPEP at 44

Copyright © 2008 School Nutrition Association. All Rights Reserved. To obtain 1 SNA Continuing Education (CEU) Credit, please take the following steps: your full name, SNA member number and full contact information to no later than THURSDAY, MARCH 26, **IMPORTANT: please use the words Webinar CEU Credit in the subject line of your Note: participation will be verified against the event registration log, so if you participated via a shared computer, please also indicate the name of the person who registered for the webinar.

Copyright © 2008 School Nutrition Association. All Rights Reserved. Q and A What are your questions? 46

Copyright © 2008 School Nutrition Association. All Rights Reserved. Disclaimer of Endorsement: reference herein to any products, services or expressed ideas does not constitute or imply endorsement or recommendation by the School Nutrition Association. Today’s webinar was made possible by: