School nutrition procurement training Part 2
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School Nutrition Procurement Training Part 2
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School nutrition procurement training Part 2
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- 2. o Forecasting for your district o Writing a Specification o Contract Management o Handouts and Resources
- 3. Solicitations and specifications start with the planning based on the size and scope of your program operations through: o Accounting o Budgeting o Forecasting o Future needs of program
- 4.
- 5. Solicitations communicate what is needed for purchasing Need may be based on prior year numbers adjusted for changes projected for the upcoming year. o Average Daily Participation, Revenues, Expenditures, etc., to estimate needs o Adjustments may include changes such as Community Eligibility Provision, re-zoning of schools, if applicable Research the marketplace
- 6. What Programs are operated? o Self-operating, on-site food preparation, central kitchen How many schools What is the total enrollment? What is the average daily participation? What is the estimated value of the purchases in the solicitation? Does the scope include purchased items and distribution services (for example delivery to one warehouse location or all school sites) Contract duration dates
- 7. What is the Average Daily Participation (ADP) o BY SITE, or o All locations total, or o By Elementary, Middle, and High School • (if different menus are served by age/grade level Do you know your sites ADP?
- 8. School District Specification Worksheet on Average Daily Participation (ADP) Must be completed by the SFA SiteName Enrollment Reimbursable Lunches Extra Sales Reimbursable Breakfasts Extra Sales Extra Sales Other Sales Paid Free Reduce d Student Adult Paid Free Reduce d Student Adult Student Adult TOTALS 0 0 0 0 $ - $ - 0 0 0 $ - $ - $ - $ - $ -
- 9. Expenses based on the prior year o If solicitation includes all food purchases for a period, the amount of purchases for this period helps vendors understand the scope of the contract (size, potential value, etc.) The contract period may adjust the estimated expenditures o One time delivery versus weekly delivery o Annual versus monthly (produce for example)
- 10. Example: ADP for meals- 18,210 meals/day Elementary: 10, 575 lunches/day + 5,375 breakfasts/day Middle: 3,735 lunches/day + 1,924 breakfasts/day High Schools: 4,900 lunches/day + 521 breakfasts/day o Extra sales: 3,000 meal equiv. or $ value total
- 11.
- 12. Informal Purchases (Below $150,000) o Micro purchase (Below $3,500) o Small purchase ($0-150,000) Formal (above $150,000) o Invitation for Bid (IFB) o Competitive Proposals (Request for Proposals) o Please Review Chart in your packets!
- 13. Count the number of times an item is served o Per month - gives vendors an idea of monthly use o Total quantity over a period of time Multiply the number of times served by the ADP o Per month provides vendors usage information o Total estimated quantities provides information for bid evaluation purposes o Look at your highest volume products first
- 14. MONDAY CHOOSE 1/SERVING CHOOSE 1/SERVING CHOOSE 1/SERVING CHOICE OF 1/SERVING CHOOSE 1/SERVING 8.24 CHICKEN NUGGETS W/ STEAMED CARROTS FRESH FRUIT PASTA - 1/2 CUP OFFER MIN. 2 CHOICES CATSUP PKG - 1 OZ 9.21 MAC & CHEESE (1/2 CUP) MIN. 2 CHOICES WG BREADING .5 OZ SKIM FLAVORED: MUSTARD PKG-.5 OZ 10.19 LETTUCE + TOM APPLES - RED/GREEN WG DELI FLAT CHOC/STRA WBERRY LOWFAT RANCH- 1 OZ 11.16 DELI SANDWICH (1/4 + 1/8 CUP) APPLESAUC E 1.5 OZ 1% UNFLAVORED FF ITALIAN - 1 OZ 12.14 CHEF SALAD GREEN LEAF + TOM 1/2 CUP WW CRACKERS FF 1000 IS. - 1 OZ 1.04 (1.5 M/MA + .5 OZ M/MA 1 CUP + 1/8 CUP 2 PKG = 1 OZ Elementary Menu for August 24, 2015-January 9, 2016
- 15. MONDAY CHOOSE 1/SERVING CHOOSE 1/SERVING CHOOSE 1/SERVING CHOICE OF 1/SERVING CHOOSE 1/SERVING 8.24 CHICKEN NUGGETS W/ STEAMED CARROTS FRESH FRUIT PASTA - 1/2 CUP OFFER MIN. 2 CHOICES CATSUP PKG - 1 OZ 9.21 MAC & CHEESE (1/2 CUP) MIN. 2 CHOICES WG BREADING .5 OZ SKIM FLAVORED: MUSTARD PKG-.5 OZ 10.19 LETTUCE + TOM APPLES - RED/GREEN WG DELI FLAT CHOC/STRAWBERRY LOWFAT RANCH- 1 OZ 11.16 DELI SANDWICH (1/4 + 1/8 CUP) APPLESAUCE 1.5 OZ 1% UNFLAVORED FF ITALIAN - 1 OZ 12.14 CHEF SALAD GREEN LEAF + TOM 1/2 CUP WW CRACKERS FF 1000 IS. - 1 OZ 1.04 (1.5 M/MA + .5 OZ M/MA 1 CUP + 1/8 CUP 2 PKG = 1 OZ TUESDAY CHOOSE 1/SERVING CHOOSE 1/SERVING CHOOSE 1/SERVING CHOICE OF 1/SERVING CHOOSE 1/SERVING 8.25 TACO SALAD PINTO BEANS FRESH FRUIT WG TCO CHIPS - 1 OZ OFFER MIN. 2 CHOICES SALSA - 1 OZ 9.22 2 OZ M/MA 1/2 CUP MIN. 2 CHOICES CINN. ROLL - 2 OZ SKIM FLAVORED: CATSUP PKG - 1 OZ 10.20 LETTUCE + TOM GRAPES/BANANA WG DELI FLAT CHOC/STRAWBERRY MUSTARD PKG-.5 OZ 11.17 DELI SANDWICH (1/4 + 1/8 CUP) CANNED PEACHES 1.5 OZ 1% UNFLAVORED LOWFAT RANCH- 1 OZ 12.15 CHEF SALAD GREEN LEAF + TOM 1/2 CUP WW CRACKERS FF ITALIAN - 1 OZ 1.05 (1.5 M/MA + .5 OZ M/MA 1 CUP + 1/8 CUP 2 PKG = 1 OZ FF 1000 IS. - 1 OZ WEDNESDAY CHOOSE 1/SERVING CHOOSE 1/SERVING CHOOSE 1/SERVING CHOOSE 1/SERVING CHOOSE 1/SERVING 8.26 CHEESE PIZZA FRESH SALAD FRESH FRUIT WG PIZZA CRUST OFFER MIN. 2 CHOICES 9.23 2 OZ M/MA 1 CUP + 1/8 CUP MIN. 2 CHOICES 2 OZ SKIM FLAVORED: CATSUP PKG - 1 OZ 10.21 LETTUCE + TOM PEAR/APPLE WG DELI FLAT CHOC/STRAWBERRY MUSTARD PKG-.5 OZ 11.18 DELI SANDWICH (1/4 + 1/8 CUP) CANNED PEARS 1.5 OZ 1% UNFLAVORED LOWFAT RANCH- 1 OZ 12.16 CHEF SALAD GREEN LEAF + TOM 1/2 CUP WW CRACKERS FF ITALIAN - 1 OZ 1.06 (1.5 M/MA + .5 OZ M/MA 1 CUP + 1/8 CUP 2 PKG = 1 OZ FF 1000 IS. - 1 OZ THURSDAY CHOOSE 1/SERVING CHOOSE 1/SERVING CHOOSE 1/SERVING CHOOSE 1/SERVING CHOOSE 1/SERVING 8.27 HAMBURGER ON BUN CORN - 1/2 CUP FRESH FRUIT HAMBURGER ON BUN OFFER MIN. 2 CHOICES 9.24 2 OZ M/MA LETTUCE + TOM MIN. 2 CHOICES 1.75 OZ SKIM FLAVORED: CATSUP PKG - 1 OZ 10.22 (1/4 + 1/8 CUP) APPLE/ORANGE WG DELI FLAT CHOC/STRAWBERRY MUSTARD PKG-.5 OZ 11.19 DELI SANDWICH ALL SANDWICHES PINEAPPLE 1.5 OZ 1% UNFLAVORED LOWFAT RANCH- 1 OZ 12.17 CHEF SALAD GREEN LEAF + TOM 1/2 CUP WW CRACKERS FF ITALIAN - 1 OZ 1.07 (1.5 M/MA + .5 OZ M/MA 1 CUP + 1/8 CUP 2 PKG = 1 OZ FF 1000 IS. - 1 OZ Elementary Menu for August 24, 2015-January 9, 2016
- 16. Item Description: Serving Dates Hamburger patties 8.27, 9.24, 10.22, 11.19, 12.17, 1.07 Chicken nuggets 8.24, 9.21, 10.19, 11.16, 12.14, 1.04 Pizza, Cheese 8.26, 9.23, 10.21, 11.18, 12.16, 1.06 If the ADP is 18,210, how many servings are needed based on the serving dates provided above? 18,210 x 6 serving dates = 109,260 servings for each item
- 17. Velocity or Usage Reports from current year vendors Will be able to show you past usage of your past menu Will allow you to predict future usage amounts if variables stay the same for the next school year Will allow you to adjust future usage if you were to change menu items or have a cycle menu offering Will allow you to adjust future participation levels if enrollment, ADP, or meal offerings change: For example, Breakfast after the bell, CEP, enrollment changes, school openings/closings due to growth or reductions in your community workforce
- 18. SERVING DATE ITEM DESCRIPTIO N CASE/PAC K SIZE SPECIFICATION DELIVERY: AS ORDERED 1 WEEK BEFORE SERVING ESTIMATE D QUANTITY BID UNIT UNIT $ CS/#/EA EXTENDED PRICE PURCHAS E UNIT MEAT/MEAT ALTERNATE PRODUCTS $/CODE # BEEF, GROUND 4/5# Grade A, Raw, 90% lean, course ground, 100% beef no extenders, unseasoned, delivered hard frozen (other specification as required) LIST DATES BY THE MONTH: AUG, SEPT, OCT, NOV, DEC, JAN 14,500 servings/date 20,000 # $ - $ - BEEF PATTIE 192/2.5 oz, CN label Grade A, raw, 80% lean, 5% TVP, unseasoned, IQF, delivered hard frozen, CN label 2.5 oz = 2oz Meat/Meat Alternate LIST DATES BY THE MONTH: AUG, SEPT, OCT, NOV, DEC, JAN 14,500 servings/date 72,500 SRV $ - $ - CHEESE, 192/ .75 oz 100% real natural cheese from cow's milk , approx. 20-25% less fat; sliced from blocks with paper separations; APPROX. 1 CS/WEEK FOR DAILY USE IN CHEF SALADS AND DELI SANDWICHES, PRIMARILY USED WITH
- 19. SERVING DATE ITEM DESCRIPTIO N CASE/PAC K SIZE SPECIFICATION DELIVERY: AS ORDERED 1 WEEK BEFORE SERVING ESTIMATE D QUANTITY BID UNIT UNIT $ CS/#/EA EXTENDED PRICE PURCHAS E UNIT MEAT/MEAT ALTERNATE PRODUCTS $/CODE # BEEF, GROUND 4/5# Grade A, Raw, 90% lean, course ground, 100% beef no extenders, unseasoned, delivered hard frozen (other specification as required) LIST DATES BY THE MONTH: AUG, SEPT, OCT, NOV, DEC, JAN 14,500 servings/date 20,000 # $ - $ - BEEF PATTIE 192/2.5 oz, CN label Grade A, raw, 80% lean, 5% TVP, unseasoned, IQF, delivered hard frozen, CN label 2.5 oz = 2oz Meat/Meat Alternate LIST DATES BY THE MONTH: AUG, SEPT, OCT, NOV, DEC, JAN 14,500 servings/date 72,500 SRV $ - $ - CHEESE, 192/ .75 oz 100% real natural cheese from cow's milk , approx. 20-25% less fat; sliced from blocks with paper separations; APPROX. 1 CS/WEEK FOR DAILY USE IN CHEF SALADS AND DELI SANDWICHES, PRIMARILY USED WITH
- 20.
- 21. Clear and accurate description of technical requirements Can include statement of qualitative nature of good/service which also outlines minimum essential characteristics and standards Cannot simply specify brand name, must be “brand name or equal” Remember: If the specifications are not clear, the proposals the SFA receives may not meet the SFA’s needs!
- 22. Menus must be written prior to this exercise Item descriptions Cycle menus are advantageous Product details: (bulk, individually wrapped, split units, form of the product) Invoices would be helpful to review
- 23. Factors to consider: o Grading o Weight o Quantity o Form of food -- fresh, frozen, canned o Nutritional qualities, etc.
- 24. Informal Purchase (Below $150,000) o Micro purchase (Below $3,500) o Small purchase ($0-150,000) Formal (above $150,000) o Sealed Bid process (Invitation for Bid) o Competitive Proposals (Request for Proposal) o Non Competitive proposal (Single Source)
- 25. Cover Letter Specification Request School Calendar for upcoming year Site Delivery locations & times USDA Forms (debarment, etc) Timeline, due dates, bonding requests etc. Any other pertinent information with procurement contact name, phone number, email etc.
- 26. Add District specific Information to your Procurement packet including contact information to customize your Procurement proposals!
- 27. How do I evaluate Procurement materials? Procurement Packet Checklist from Offerers Is it Responsive to your request? Is the vendor Responsible? Ranking Matrix Conflict of Interest Statement from evaluators Insurance, bonding, references, questionnaires, etc Independent Ranking Scores Selection of Vendor
- 28. Evaluation materials are specific to your site’s Procurement request! Documents may be subject to State Agency review & written approval before contract is executed! RFP No. <Insert RFP Number Here> <Insert School District/public entity Name Here> RFPTemplate Proposal Evaluation Name of Offeror ____________________________________ Date of Evaluation EVALUATION COMMITTEE INSTRUCTIONS This is the first meeting of the evaluation committee for RFP #_<Insert RFP Number Here>. At this meeting, I shall distribute the original solicitation, the Offeror’s proposals, team member briefings and reference questions. After review and individual evaluation scoring of each proposal, we will discuss questions and/or comments. The evaluation committee will come to a consensus regarding which proposal(s) is the most advantageous to the <Insert School District/public entity Name Here>. After reading the solicitation, please thoroughly review each proposal; the “Scope of Work” and “the Special Instructions to Offerors” for the information requested by the District. All comments should address the Offeror’s response to our specific requirements of the solicitation.
- 29. Different products may require different methods for quoting and evaluating prices o Chicken nuggets-based on the number of servings require a price/serving • For example: chicken nuggets/case may be purchased in a variety of pack sizes, 240-320 or more nuggets each with a variety of sizes to equal CN- 2 oz Meat/meat alternate and 0.5-1 oz grain/ serving or • The case price for products with 320 or 300 nuggets/cs may have a case price that is more than the product with 240 nuggets. However, the serving cost may be less.
- 30. PRODUCT PACK: 240-320 NUGGETS/CASE OR 3-6 NUGGETS = 2.0 OZ M/MA ESTIMATED QUANTITY: 1830 cases (if averaged 5/srvgs) BID RESPONSES: BID 1= 320/0.8 OZ NUGGETS (3=2.0 M/MA) o $50.88/CASE x 1830 cases = $93,110.40 BID 2= 240/0.6 OZ NUGGETS (4= 2.0 M/MA) o $36.00/CASE x 1830 cases =$65.880.00
- 31. PRODUCT PACK: 240-320 NUGGETS/CASE OR 3-6 NUGGETS MAY= 2.0 OZ M/MA ESTIMATED QUANTITY: 93,000- 2.0 OZ M/MA SERVINGS BID RESPONSES: BID 1= $.48/SERVING, o PURCHASE UNIT = $50.88/CASE BID 2= $.60/SERVING o PURCHASE UNIT IS $36.00/CASE
- 32. SCHOOL DISTRICT NAME: ABC DISTRICT Foods Approved for Purchase Serving Dates: AUG. 1, 2015-JANUARY 8, 2016 ITEM DESCRIPTION CASE/PACK SIZE VENDOR AND BRAND NAME CASE PRICE MEAT/MEAT ALTERNATE PRODUCTS BEEF, GROUND 4/5# BEEF FOOD $60.00/CS BEEF PATTIE 192/2.5 oz, CN BEEF FOODS $$76.00/CS CHEESE, DELI-SLICED, REDUCED FAT, MEDIUM CHEDDAR 192/ .75 oz servings in 3/3# packages/cs CHEZ FOODS $19.00/CS CHICKEN NUGGET 320 each/cs CN - 4 nuggets = 2 oz POULTY FOODS $32.00/CS CHICKEN BREAST FILLET 120/3.2 oz each/cs CN POULTRY FOODS $54.00/CS PIZZA, CHEESE 96/approx. 4.5 oz CN PIZ FOODS $51.84/CS PIZZA, PEPPERONI 96/approx. 4.5 oz CN PIZ FOODS $51.84/CS TURKEY BREAST, DELI- SLICED 108-1 oz slices - 12/9 oz/cs POULTRY FOODS $27.00/CS HAM, DELI-SLICED 108-1 oz slices -12/9 oz/cs PORK FOODS $24.00/CS CATEGORY: FROZEN VEGETABLES CORN, WHOLE KERNEL 20# VEGGIE DELIGHTS $17,00/CS CARROTS, SLICED 20# VEGGIE DELIGHTS $12.00/CS BROCCOLI, FLORETS 20# VEGGIE DELIGHTS $19.00/CS TATER TOTS 6/5# BEST TATER FOODS $15.00/CS CATEGORY: CANNED VEGETABLES GREEN BEANS 6/# 10 CASE BEAN GOUP $18.00/CS BEANS, BAKED 6/# 10 CASE PICNICS BEST $24.00/CS BEANS, PINTO 6/#10 BEAN GROUP $15.00/CS
- 33.
- 34. Food Service Management Companies Contract monitoring form available Vended Meal Contracts Modified monitoring form available Vendor Contracts (food, supplies, services) Informal monitoring process
- 35. Menus and Service Yes Needs Improvement N/A 1. Has the FSMC followed the 21-day cycle menu as described in contract, for the first 21 days of the contract? (Monitored during the first year of contract only) 1. If changes were made to menus following the first 21 days of the contract, did the SFA approve them? 1. Menu standards have been maintained as to type and quality of meal service. All menus have been developed using the agreed upon food based menu planning system(s) for each age/grade group. a. The FSMC is serving only reimbursable meals that comply with the latest USDA dietary guidelines as established by USDA in Federal regulations for the National School Lunch Program, the School Breakfast Program, and all other USDA contracted meal programs. Food Service Management Company (FSMC) Monitoring Form Review Date: Name of District and Site Monitored:
- 36. Continuously monitor contracts to ensure you are receiving the correct products & services solicited including substituted items Ensures that contract terms are being enforced Ensures accurate & timely payment of invoices, including the return of discounts, rebates, and credits
- 37. Best Practices: Check pricing on invoices from the start of the contract (school year for example) Make sure credits are issued when due to SFA Make sure purchasing employees are aware of the approved vendors, pricing, and logistics Confirm delivery times of products are adhered to & completion of job done (for example, equipment delivery)
- 38. Procurement Plan that meets the regulations of the Child Nutrition Program! Specific to your operational needs Lowest price to value for your District/RCCI Encourages competition Best match to your district’s needs depending on level of service, local availability, and price Provides the best program outcome for your students Each time, the procurement process gets easier!
- 39. A well thought out solicitation, evaluation, award and monitoring system will result in the best contract that protects the SFA’s interests and Program funds
Notes de l'éditeur
- This session is on Forecasting, Planning, Estimating quantities, Developing Specifications and Evaluating Responses for Contract Award. The focus of this will be for purchased food and is a new segment at the request of industry – distributors, processors and manufacturers. The shortage with foods experienced this past fall may have been, in part, failure by schools to forecast, plan and estimate the quantity of foods needed. Industry shared that schools have never forecasted well; however in the past, they were able to meet the need with commercial substitute items; however they are not able to do this now as commercial products do not meet the specifications for products that meet the meal pattern. Additionally, industry reported that schools fail to communicate when they are making changes such as changing to the community eligibility provisions which substantially increases participating. Industry uses velocity reports of past performance to determine future need as well as estimated quantities during the solicitation phase to plan production. Failure by schools to communicate changes in past performance or to accurately calculate product needs contributed to the stress industry is still experiencing with changes to the meal pattern especially related to whole grain and sodium requirements. This session is not about whole grains or sodium, this session is about forecasting, planning, and communicating needs through the procurement process from the solicitation to contract management. How can schools improve how they are projecting and communicating their needs? By planning menus for longer periods of time, estimating quantities over the planned period, and by communicating changes and managing contracts to adjust needs. In this session we will look at menu planning beyond one month, using average daily participation to project quantities beyond one month, and project program revenues and expenses to ensure payment to contractors in a timely manner? Estimating quantities over a period increases the economy of scale and projecting revenues and expenses often results in volume discounts and paying contractors within 30 days of receipt often results in discounts for timely payment. Together these may result in having the right product at the right time and at the right price – a win- win for everyone. Estimated quantities are communicated through the solicitation, however, once a contract is awarded, quantities must be monitored and adjusted to meet demand, or to prevent excess product inventory. The sooner the need for adjustments is identified, the better able industry will be able to meet product needs.
- This session is NOT a financial planning presentation. However, financial planning is essential in determining how to plan purchases. May I have a show of hands of States that provide training to SFA directors or new directors, and staff in the area of financial planning? If you do, tell us what your financial planning entails. If you do you do so, do you provide a template information for SFAs to use when developing a solicitation for FSMCs? Let me recommend that you develop a training or consider sponsoring a training using the course, Financial Management, available at NFSMI.org
- This session is NOT a financial planning presentation. However, financial planning is essential in determining how to plan purchases. May I have a show of hands of States that provide training to SFA directors or new directors, and staff in the area of financial planning? If you do, tell us what your financial planning entails. If you do you do so, do you provide a template information for SFAs to use when developing a solicitation for FSMCs? Let me recommend that you develop a training or consider sponsoring a training using the course, Financial Management, available at NFSMI.org
- How does the financial information affect forecasting for purchases. Forecasting applies to the procurement process by providing the resources to pay for purchases. The information can be tracked monthly based on the number of serving days to monitor if the revenues and expenses are on track, or if ahead or behind forecasted levels, provide time to make adjustments before problems arise. Providing vendors with forecasted information can also be provided in the solicitation document to help define the scope of the operations.
- Forecasting for purchased goods and services occurs before the solicitation document is developed. SFAs may do this based on prior year programs operated, meals served based on the number of operating days to obtain an average daily participation. However, when changes to the operations are being made for the upcoming year, these changes will affect the averages and need to be projected and communicated. For instance, when the SFA changes the operations such as to operate the community eligibility provision in one or more schools, this will likely increase participation. Therefore, the estimated quantity of items to be purchased needs to reflect this projected increase. When a district re-draws attendance zones, builds new schools, or closes schools due to changes in enrollment, these enrollment changes affect participation. Likewise, when goods or services are added, market research is needed to determine the availability and this too affects how the programs will be affected. Regardless of the change, incorporating this in the solicitation document and providing an initial estimate of quantity is essential to prepare prospective bidders that business is not as usual and the SFA is planning and hopefully, will be monitoring the effect of the changes accordingly. Language in the solicitation should also include that an update of the estimated need will be provided once school begins and a closer estimate can be established. One provision may be to state that the estimated quantities are based on actual meals served, however, the estimates are not a guarantee of minimum or maximum purchases and the SFA reserves the right to purchase 10% more or less than the estimated quantity as needed and will monitor to communicate needs and make adjustments. This way all bidder’s know that monitoring and communication will be an on-going process.
- Let’s summarize the information developed thus far: Forecasting for the scope of a solicitation includes providing meaningful information that is beneficial for vendors to help them make decisions for how to respond. Many food distributors are looking at the truckload count and value when considering how to respond with prices, especially when making deliveries to multiple sights on a weekly basis. Therefore, the scope may state that the district is self-operating, conducts on-site food preparation, or operates a central kitchen, if applicable. The number of schools, total enrollment, average daily participation, and estimated value of purchases provides the vendor with the information to estimate what will be expected when considering how to respond.
- Where does forecasting begin. By knowing the size of the operations, the average daily participation by site, for all locations, or by the age/grade level. This information provides an estimate of the number of meal component items that must be purchased once the menu is planned.
- Let’s look at another HANDOUT ENTITLED: SCHOOL DISTRICT WORKSHEET ON AVERAGE DAILY PARTICIPATION. This information also provided as a template for SFAs when contracting with a FSMC, is beneficial to all SFAs for use in identifying schools, enrollment size, the number of reimbursable meals served (which may be totaled for all schools or identified by category) for each Program operated. This form shows Breakfast and Lunch, with extra sales in these programs. However, other programs can be added when these are operated. If the State agency uses site-based claiming, the ADP by location is easily obtained from the claiming system track ADP each month based on the number of meals served and the number of serving days. However, if the State agency does not use site-based claiming, SFAs may have the information in their POS systems, if used. In the States that consolidate claiming, if small SFAs have a manual process in place for counting meals daily, they also have a method of consolidating this information on a monthly basis. So they have access to this information as well.
- Armed with ADP, revenues and expenses for the next year, the SFA is now ready to begin estimating purchases for a period. If the SFA is contracting purchases for the year, all vendors understand the estimated value of the purchases and can estimate the value of purchases the SFA will make overall and if desired, by location.
- For example: The district operates the National School Lunch and School Breakfast Programs ONLY. The information may state something like what is presented here. This information may be placed in the scope of the solicitation for the purchase of food items as well as supplies, if purchased together. This information also helps the SFA estimate the quantity of items needed during the contract period determines the type of procurement methods to be used. For an operation serving 18, 210 meals plus breakfast meals and a la carte sales, the purchases for this district will all be conducted formally, using sealed bids or competitive proposals.
- One benefit of forecasting is decision of will the procurement method be informal, below the small purchase threshold, or will be method be formal due to value and contract duration. A small SFA that plans the menu for one month at a time may purchase using informal methods because their size, storage, and procedures do not necessitate formal procedures. However, if the small SFA planned their menu for the month to cycle over a period of months such as half of the school year, their purchases may exceed the small purchase threshold creating a need for more formal procedures. This approach may attract vendors to potentially provide competitive prices for purchased goods and delivery services. Medium and larger SFAs often have budget and participation records in place to assist them in planning. However, if they are not estimating revenues, expenses and using participation averages to plan their menu for a longer period, they may not be forecasting to the level distributors and manufacturers need to properly forecast their distribution and manufacturing operations. Using these planning measures may also attract competition to provide products or services. Let’s look at this process.
- Forecasting may help Program operators move from methods only requiring minimal competition to more competitive methods which may result in more competition. Forecasting shows that the Program is begin operated for a longer range plan which attracts businesses to the competitive opportunities
- To estimate quantities over a period of time is forecasting. This is planning for a longer range of time and industry representatives believe this is key to preventing future challenges in with meeting the demand for food. Estimating quantities is counting the number of times an item is served monthly and over the period of time to be contracted then multiplying this the average daily participation
- Looking at the primary food items and estimating student selection based on percentage.
- This handout title: Elementary menu August 24, 2014-January 9, 2016 This handout shows one method of creating a multi-month, 4 week cycle menu. Estimating quantities may be completed by multiplying the number of times an item appears on the menu (number of serving days) x the Average daily participation. Looking at the primary food items and estimating student selection based on percentage.
- Let’s look at examples of what happens to the quantities when a one-month menu is multiplied beyond one month. By inserting a column on the menu the SFA can input the dates for when the menu cycles at the end of 4 weeks. This forecasts the need based on the dates served and based on an ADP of 18,210. When served 6 times, the quantity needed for purchase becomes 109, 260 servings for these items. However, as you can see additional choices are also available on the menu so these choices may reduce the estimate depending on the selection of these items. However, these are popular choices student often make, so these quantities will likely be within the provision that purchases may be within 10% of the estimated quantity. Do you see how creating a 4 week cycle menu over a period of several months can change the quantity of purchases in such a way that may assist food manufacturers and distributors into considering competing for the business. This may also help these vendors forecast their business operations which may help reduce food shortage or the need to substitute product.
- Let’s look at examples of what happens to the quantities when a one-month menu is multiplied beyond one month. By inserting a column on the menu the SFA can input the dates for when the menu cycles at the end of 4 weeks. This forecasts the need based on the dates served and based on an ADP of 18,210. When served 6 times, the quantity needed for purchase becomes 109, 260 servings for these items. However, as you can see additional choices are also available on the menu so these choices may reduce the estimate depending on the selection of these items. However, these are popular choices student often make, so these quantities will likely be within the provision that purchases may be within 10% of the estimated quantity. Do you see how creating a 4 week cycle menu over a period of several months can change the quantity of purchases in such a way that may assist food manufacturers and distributors into considering competing for the business. This may also help these vendors forecast their business operations which may help reduce food shortage or the need to substitute product.
- Find the handout entitled SAMPLE BID DOCUMENT. Let’s refer back to this solicitation document we looked at earlier. Earlier we saw how to layout the document to include the item description, specification, etc. Let’s now find the column for estimated quantities and serving dates. This is where you would record the estimated quantity, and provide the serving dates or provide an estimate of the quantity needed per month. This helps the distributor and manufacturer understand how to estimate your need and have the product available for delivery when needed.
- Find the handout entitled SAMPLE BID DOCUMENT as this provides a simple example for how to provide a format of the item description, specifications, estimated quantities, the unit on which the item is being bid and a place for the bidder to place the bid price for the bid unit, the extended price and purchase unit. This is for a solicitation for purchased foods. When creating the solicitation the information must include information to describe the item, case/pack size, and sufficient specification for responders to identify items desired. You will also see information that includes serving dates to help distributors know the frequency of items to be served, therefore, purchased. The column on estimated quantities is just that – a quantity estimated based on frequency of serving which will be multiplied based on the number of times the product is offered during the menu cycle based on the average daily participation. To make the calculation beyond one month, the menu can cycle for several months. Once the menu is planned for one month, the menu can be planned for more than one month.
- Forecasting menus and purchases will likely result in the need to consider items to add variety or a choices to the menu. As with items that have been tried and tested as student favorites, products change and research has to be conducted to determine available products and how to write the specification to competitively purchase these.
- Before we estimate quantities using the information collected thus far, Let’s talk briefly about item descriptions and the product details we call specifications To provide this information, the SFA needs to know the menu that is planned.
- Since we have completed a full day of training on the procurement methods, I am only showing how forecasting helps increase the quantity and value of purchases to obtain volume discounts. Forecasting may help Program operators move from methods only requiring minimal competition to more competitive methods which may result in more competition. Forecasting shows that the Program is begin operated for a longer range plan which attracts businesses to the competitive opportunities
- Let’s review how a product that comes in various pack sizes will adjust how bid responses must be evaluated. Chicken nuggets may be purchased in cases that vary from 240-320 nuggets case. When evaluating responses, the difference in case size and serving size may vary making a difference in the lowest price award on a line item award basis. However, in a lump sum award either by category, or for an all or nothing award, this price alone may not determine the lowest bidder in a fixed-price contract. However, different distributors may bid different products and failure to evaluate properly may determine which manufacturer’s product will be purchased. We understand that SFAs are not conducting these evaluations carefully. Chicken nuggets are not the only product with different pack sizes so careful attention must be made on every item with varying pack sizes. Even beef patties may vary in pack size from 48-192/case. Industry members tell us that pack-size requires finding a common denominator to ensure evaluation is conducted properly.
- Let’s say the bid is quoted in cases using an average of 5 nuggets/serving and the quantity is NOT adjusted for 3 or 4 nuggets/serving. The number of case units estimated is 1830 CASES. The price for bid 1 is $50.88/case x 1830 cases = $93,110.40 Bid 2, the cost will be $36.00/CS X 1830 CASE= $65,880.00. IF the number of cases is NOT adjusted based on the number of servings/case, and is awarded based on the lowest price/case the bid will be awarded to Bidder 2 as the price is approx. $27,230 less. However, when the bid award is calculated using the common denominator, in this EXAMPLE serving cost vs case cost, bid evaluation results will change as the number of cases required will be less due to the number of servings/case. For bidder 1, 106 servings/case means only 878 cases will be required, therefore, the cost will now be $44,672.64 NOT $93,110, a difference of approximately $48,438. For bidder 2 the number of cases will be adjusted to 1550 for a total cost of $55,800 NOT $65,880, a difference of almost $10,000.00. Industry members tell us there is a problem among schools with properly evaluating bids and determining the best product AT THE best price. The difference is the serving cost vs the case cost. When all products have the same pack size, such as 6/#10 cans of vegetables and fruits, evaluation can be based on the number of cases. However, when various products have different pack sizes, evaluation must be based on the common denominator for the units. This may vary from servings, pounds, each, or another unit of measure that can be clearly defined and described to ensure fair and open competition is achieved. The way to make the evaluation process easier is to use the common denominator in the solicitation document. This also helps to avoid costly mistakes and the potential for a bid protest that may cause delays in finalizing the contracts.
- LET’S LOOK AT THE PACK INFORMATION SPECIFIED ON THE BID DOCUMENT FOR CHICKEN NUGGETS. IF THE BID SPECIFIES PRODUCTS MAY HAVE 240-320 NUGGETS/CASE AND 3-4 NUGGETS/SERVING = 2.0 OZ MEAT/MEAT ALTERNATE. One product was submitted by Bidder 1 that provides a CN label for 3 nuggets = 2.0 M/MA. The per serving cost is quoted at $0.48/serving WITH A PURCHASE UNIT OF $50.88/CASE. Bid 2 submits one product that provides a CN Label for 4 nuggets -2 oz Meat/meat alternate. The cost per serving quoted is $.60/serving WITH A PURCHASE UNIT COST OF $36.00/CASE As long as the products meet the specification and the CN Label for the number of nuggets is correct, which bid is the lowest cost? Bid 1 as the bid quantity is estimated in servings and the cost per serving is less To properly evaluate these bids the most common denominator must be used to determine the lowest price. The common denominator is the cost per serving. LET’S EVALUATE
- Let’s look at the handout: foods approved for purchase. Once bids are evaluated and awarded, one way to communicate to schools what is approved for purchase is to provide a list. The list should include the product description, case pack (as bid) brand name and case price. You will see that vendor is also included with the brand name, you may put the vendor in this section, or you may list the products by vendor. For example, if bid award allowed for multiple bidder’s to be awarded product as when products are evaluated by category, you may list the products by the awarded vendor or include the entire list of products with information by vendor stated within the document. There is no one way to communicate the information. The most important thing is to communicate what products are approved for purchase, the case/pack size, brand name and bid price awarded. From this information schools can order foods to be served on the menu, and when delivered, check the invoice and product label to ensure the right product has been purchased and received.
- Contract management follows contract award. For contract evaluation to evaluation to occur everyone involved in the purchase of products and services must receive information for what is to be purchased and from whom. This can occur in a number of forms, email or may also be using the contractor’s ordering system. In the case of food distributors, many distributors set-up a login for access to their ordering system. Many distributors may provide access to the entire product line available, or may, or may not, be able to establish an account within their system for the specific contract. Whether the account access is for all products or limited to approved products only, schools need to know the products approved for purchase and how to check invoices and products when delivered to ensure the right product is purchased and delivered at the right price. This information applies to other products and services as well, however, to continue with our solicitation process for purchased foods above, let’s look at one example of how to communicate what is approved for purchase.
- The solicitation is key to ensuring the SFA communicates all requirements and potential respondents understand the expectations and products or services and how to provide competitive prices. A poor solicitation may result in bid protests delaying or resulting in the solicitation being cancelled and starting again. Such delays can be detrimental to program operations and Program funds, therefore, the solicitation must be carefully developed, responses carefully evaluated and awarded, with contract management processes in place to ensure the process achieves full and open competition in an environment that is fair and transparent for all.
- Are there any questions on solicitations, specifications, estimated quantities, evaluation procedures, awards and contract monitoring procedures?