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1
Welcome!

• To join the audio portion of the event, please
  dial in to the new number
• 8oo-937-4791
• (Please note that this is a NEW dial in number)

Note Instructions on how to obtain 1 CEU credit
for participating in todays event will be
provided at the conclusion of the webinar
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.
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Dairy ProcurementHow to DevelopBid
Specifications RFPs for aSuccessful 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.
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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.

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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

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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

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 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

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Importance of Nutrients

• Milk contains nine essential nutrients
• Food group to encourage
• Three of the five nutrients of concern
• calcium, potassium, and magnesium.
• 2005 DGAs emphasized low-fat or non-fat milk and
  milk product
• 2005 DGAs stated added sugar has a value in
  increasing palatability

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Importance in School Meals

• Milk required meal component
• Healthy eating patterns during childhood affect
  later years
• More milk choices than ever before

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Federal Law Requirements

• Richard B. Russell National School Lunch Act - 42
  U.S.C. 1751 et seq.
• Child Nutrition and WIC Reauthorization Act of
  2004 - P.L. 108-265
• Reimbursable lunches must offer fluid milk in a
  variety of fat contents (minimum of 2)
• May offer flavored, unflavored, lactose-free

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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

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 Basic Decisions

• 1. Appropriate purchase method
• 2. Pricing mechanism
• 3. Number of vendors required

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Purchase Procedures

• 1. Request for Quotation small purchase
  procedure
• 2. Competitive Sealed Bids formal process
• 3. Request for Proposal formal process
• 4. Noncompetitive Negotiation

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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

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Pricing Mechanism

• 1. Fixed firm price for specified time period
• 2. Escalation/de-escalation clause tied to
  third party bulletin
• httpwww.ams.usda.gov/dairy/orders.htm

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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 httpwww.ams.usda.gov/dairy/orders.htm

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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

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Rock Hill School District Chad Mitchell, MS, RD

• Suburban School District
• 25 Schools
• Enrollment 18,000
• 500 students/year

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Rock Hill School District

• Sealed Bid
• Product Specifications
• Price Escalator/De-escalator
• Plastic and Paper containers
• Contract Extensions
• Bidder Responsibilities
• Success Story

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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

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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

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District Decision

Product Container Type Unit Volume Unit Price Estimated Quantity Extended Price
Chocolate Skim Plastic Bottle 8 fl oz 1,111,320
Paper Carton 8 fl oz 1,111,320
Vanilla 1 Plastic Bottle 8 fl oz 79,380
Paper Carton 8 fl oz 79,380
Strawberry 1 Plastic Bottle 8 fl oz 79,380
Paper Carton 8 fl oz 79,380
White 1 Plastic Bottle 8 fl oz 158,760
Paper Carton 8 fl oz 158,760
White Skim Plastic Bottle 8 fl oz 158,760
Paper Carton 8 fl oz 158,760
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Success Story
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Wood County SchoolsBeverly Blough, MS, RD, LD

• Urban and Rural School District
• 27 Schools
• Enrollment 13,414
• Request for Proposals

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Wood County Schools

• Vendor Conference
• Bidder Responsibilities
• Product Specifications

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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

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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

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Wood County Schools

• Firm Price and Escalator/De-escalator
• Plastic or Paper Containers

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RFP Evaluation

• Meeting Nutrition Standards Goals of District
• Variety of product available
• Product Quality
• Delivery Service
• Overall Integrity of Vendor
• Price

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Success Story
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Spring Independent School DistrictMelanie
Konarik, MS

• Suburban School District
• 31 Schools
• Enrollment 33,000

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Spring Independent School District

• Purchasing Cooperative
• Fixed Firm Price
• Nutrition Analysis Software Vendor Bid

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Harris County Department of Education (HCDE)

• Request for Proposal
• Product Specifications
• Firm Price
• Packaging type
• Responsible
• Bidder Responsibilities
• Success Story

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Evaluation Criteria

• Price
  50
• 2. Meet HCDE/GCC Terms Conditions 20
• 3. Ability to meet needs of members 20
• 4. Company References 10

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Success Story
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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)

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Resources
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First Choice A purchasing systems manual for
school food service, Second EditionNational Food
Service Management Institute
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Choice Plus a reference guide for food and
ingredients National Food Service Management
Institute
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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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Additional Resources

• State regulatory agencies
• Your local Dairy Council representative
• MilkPEP at www.milkpep.org

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To obtain 1 SNA Continuing Education (CEU)
Credit, please take the following steps

• Email your full name, SNA member number and full
  contact information to bhanna_at_schoolnutrition.org
  no later than THURSDAY, MARCH 26, 2008.
• IMPORTANT please use the words Webinar CEU
  Credit in the subject line of your email

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Q and A

• What are your questions?

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Todays webinar was made possible by
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.