1. Chad Mohr DHHS Program Coordinator/State of Nebraska Distribution Charges

4. TAKE LOOK AT THE BIG PICTURE The RFP is to create a competitive environment: Distribute popular items Simplify the terms Consolidate the system Increase volume; FFS processing goes through State warehouse Distribution Charges

5. Let RAs decide what is popular. Direct Delivery: Step one: Pick from Foods Available list. Step two: Survey how many case per month or year. Processed: Procure most acceptable end products Use JIT inventory management Distribute Most Requested Items

6. Starting in SY14-15 Improvised with Survey Monkey until we could use reallocated SAE for a “real” system. Use Survey Monkey with Food Available list. Then survey how many case per year. Benefit: no dead inventory = no losses = no wasted space = attractive contract Distribute Most Requested Items

7. SY15-16 Implemented an actual RDOS (SAE funded). Use Survey Monkey with Food Available list. Then survey how many case per month with the RDOS. Benefit: no dead inventory = no losses = no wasted space = attractive contract Distribute Most Requested Items

8. Typical survey page: Canned Peaches

9. Split trucks to your advantage. Get to know your neighbors! Split with other States as well as RAs. Small frequent deliveries conserve warehouse space. Less popular but unique items can still be distributed. – Limit delivery periods to avoid dwell time. Distribute Most Requested Items

10. Billing Method By the pound or by the case? Pound = error prone. Case = Benefit: simple terms = attractive contract Simplify the Terms

11. Billing Method Bill the State or the RA? State = more work for us. RA = more work for contractor. Benefit: simple terms = attractive contract Simplify the Terms

12. Delivery Zones One Zone = simple, even pricing. Multiple zones = complex pricing, small RAs in remote areas lose. Benefit: Economies of scale benefit all RAs under one zone. Simplify the Terms

13. Delivery Frequency Monthly = required Weekly = optional Allow contractor to integrate USDA Foods delivery with commercial deliveries. Benefit: Reduces costs and adds value. Benefit: Weekly delivery conserves RA freezer space. Simplify the Terms

14. Minimums Let the RFP bid process determine minimums. Score it like cost. Ended up with no minimum. Benefit: RFP produces the best value Simplify the Terms

15. Handling Frequency Multiple contractors = Costly In Nebraska consolidation = Economical Benefit: higher volume and fewer touches = more attractive contract Consolidate the System

16. Direct Ship About 50% of Direct Delivery in Nebraska is shipped to RAs. 100% TEFAP direct shipped to ERAs. Benefit: no state level costs for large RAs, but… it detracts from the volume of the state contract. Consolidate the System

17. Old System – multiple zones Consolidate the System

18. Old System – one warehouse

19. Consolidate the System Old System – three carriers

20. Consolidate the System Old System – USDA to state warehouse

21. Consolidate the System Old System – carriers picked up at S.W.

22. Consolidate the System Old System – carriers picked up at S.W.

23. Consolidate the System Old System – carriers picked up at S.W.

24. Consolidate the System Old System – carriers picked up at S.W.

25. Consolidate the System Old System – Carrier delivered to RAs

26. Consolidate the System New System – USDA to state warehouse

27. Consolidate the System New System – warehouse to RAs

28. Old System State warehouse charged $6.00 per hundred pounds Carriers charged $15.00 per hundred pounds average $21.00 per hundred pounds = $8.40/40# case Distribution Charges

29. New System State warehouse = $1.70 per case Delivery = $2.30 per case Total charge $4.00 per case vs. $8.40. Distribution Charges