A Procurement Playbook for Schools
Having the right people in place will make sure schools follow rules when using federal dollars to buy food.
Efficiency is critical to every school meal. Students are always in a rush to eat, and your kitchen must be prepared to run smoothly. Procurement plays a critical role in a well-run operation. Because it’s the first step in obtaining the foods students eat, the purchasing process must provide a solid foundation for all that follows. Success in this area allows school nutrition professionals to meet Child Nutrition Program (CNP) rules and operate effectively when hungry youngsters come pouring into the dining room.
The rules guiding education foodservice grow more complex each year. In some school districts, procurement may be the responsibility of a purchasing department or someone outside the nutrition department. That means there’s a need for communication between the foodservice director and the person responsible for managing procurement to assure all of the nutrition needs and regulations are met.
Here are four key ways a well-managed procurement process can save money that can be used to make improvements in other parts of the foodservice operation.
1. Know the rules
Procurement is a multi-step process of negotiating the best price for products and services. To be effective, competent personnel must be in place. The School Nutrition Association’s (SNA) Solving the Procurement Puzzle handbook warns procurement teams that manufacturers, brokers and even distributors don’t know all of the rules. That’s why someone in the purchasing hierarchy—the kitchen manager, the foodservice director or the district’s purchasing manager—needs to be responsible for understanding the rules as they apply to your school food program.
“There are 14,000 school districts in the U.S., and all have different limits. It’s vital to know the rules of the arena you’re playing in,” says Stacy Sagowitz, President and Owner of Food Safety Systems.
As a former school foodservice director, foodservice broker, K-12 sales manager and vendor representative, she understands all sides of procurement. The first thing to remember, she says, is that each state agency monitors child nutrition, so it can adjust the procurement threshold. In some cases, counties, municipalities, and even school districts themselves have rules to follow.
2. Make sure you’re in compliance
Any school or district receiving federal dollars must follow federal procurement law when spending those dollars. One of the first stipulations is that all bids must be competitive—everything done by the school district of the school food authority (SFA) must be transparent.
For example, when spending federal dollars, there’s a Buy American Provision of the National School Lunch Act that requires SFAs to buy domestic products to the extent that it’s possible. There are exceptions for products grown only in other countries, seasonality or costs, but those reasons must be presented in writing.
Between the local or state agencies, the United States Department of Agriculture (USDA), the industry and even the School Nutrition Association (SNA), there is a lot of pressure to procure products properly. Failure to do so can have legal and financial implications.
3. Start early to make the right bid
Know what foods you’re going to menu, says Maureen Pisanick, President and Chief Nutrition Officer at Pisanick Partners. A cycle menu can help with your ordering and even reduce the number of SKUs involved in your purchasing. Planning the menu around nutrition needs in advance is a good way to document products you need to procure. This allows time to make the best decisions, assuring your bid complies with legal requirements.
The SNA handbook points out that getting an early start allows schools to review procurement reports, consider recommendations from the state agency or vendors, compare changes made since the previous year and consider ways to improve.
4. Don’t overlook GPOs
Group purchasing organizations (GPOs) are one way for a school district to increase buying power. By using the services of a GPO or joining as a cooperative purchasing system with other schools in a region, it’s possible to get better quality products and lower prices in many cases.
Some GPOs and cooperatives charge a membership fee or have a fee structure that can charge for each delivery or a percentage of each order. Kevin Crampton, Vice President of Contracting and New Business Development at HPS, a Michigan-based GPO that serves more than 3,000 organizations in nine states, points out that federal, state, local and district procurement rules still must be followed.
Some GPOs monitor federal procurement rules and deliver a model to each clients for approval. It remains the responsibility, Crampton says, for each school to comply with regulations.