Values-aligned procurement goes beyond just local foods and directs an institution’s food spending to advance a set of values beyond prices, such as environmental sustainability, animal welfare, workers’ rights, climate-smart agriculture, and more. 

The biggest challenge in value-aligned procurements today is that it can be hard to find value-aligned products that are appropriate for use in large-scale food service operations, abundantly available, being sold by many vendors, and affordable. K-12 SFAs are getting creative in using competitive bids to drive values-aligned purchases.  

For school districts just getting started in value-aligned procurements, expanding their procurements to include value-aligned procurements, or those that just want to learn more about the subject, please read on for suggestions about buying value-aligned foods.

How to Conduct Values-Aligned Procurement

CAF suggests SFAs consider procurement to be a step-by-step process carried out throughout a school year, breaking down larger activities into discrete and manageable actions to take place throughout the school year. Below, CAF has laid out a step-by-step procurement framework that may be used for all types of procurements, from formal to informal.

STEP 1:  Menu Planning & Forecasting

As mentioned, the menu drives the procurement process,  so the first step is to develop a cycle menu for the next school year.  Menu planning is the process of designing and organizing a menu to maximize participation, use key ingredients like USDA Foods, and ultimately lead to profitability. While there are many considerations when planning menus, the procurement consideration to be mindful of is forecasting. An SFA will need to determine at this stage how new recipes or revisions to cycle menus will impact projected purchases so they can accurately forecast their food needs and ensure a successful bidding season. 

Forecasting refers to analyzing current and historical meal data and trends, plus considering any menu, recipe, or ingredient changes to determine future food needs. In other words, how much of an ingredient, an entree, or a food item does a school district anticipate needing to buy in the next school year? Forecasting as accurately as possible is important because it will influence the prices a bidder will offer based on how much of an item an SFA will be buying. If you buy more of an item, you will get a better price and conversely, if you buy only a small amount of an item, you may not get as competitive of a price offer. Accurate forecasting is one way to ensure an SFA gets the best possible price results. Once you know what foods you need and how much of each item you need, you can look for sources of values-aligned foods in the coming months.

Menu Planning and Forecasting Workbook

STEP 2: Identify Sources of Values-Aligned Food & Set Procurement Strategy  

The best way to identify and select strategies for optimizing local and values-aligned food procurements is to consider district size and operational scope. For example, can the SFA issue two produce procurements: one informal solicitation for values-aligned or local produce and one formal solicitation for more standard produce items? Is it best to have two companies provide the same service and thus issue bids for certain areas of a city or several school sites, breaking up the district so better services can be offered to more school sites? 

Below is an explanation of how to use formal and informal solicitations when buying values-aligned foods:

Informal solicitations - Informal procurements offer considerable flexibility regarding local and values-aligned procurements. There are micro-purchases ($10,000 and under and up to $50,000 and under if self-certified) and simplified acquisitions ($250,000 and under). 

To maximize value-aligned informal procurements:

• Issue micro-purchases and simplified acquisitions (informal bids) only to values-aligned vendors.
• When writing product specifications, include the manufacturer’s name PLUS the or equal (or equivalent) clause to indicate exactly what product you want.

Formal solicitations - Formal procurements are more complex but can still be values-aligned. These procurements are for purchases of $250,000 or greater. To maximize value-aligned formal procurements, use a Request for Proposal instead of an Invitation for Bid when possible. Invitations for Bids are best for items with fixed costs, like computers or paper products. Food prices fluctuate often, and trying to lock in a fixed price for a school year via IFB usually means bidders will bid higher prices on each item since they are hedging for market swings. When using a Request for Proposal (RFP), request a proposal from the bidder vendor regarding how they will support the operation’s values-aligned purchasing goals. At the very least, include a vendor questionnaire. SFAs can also interview bidders to learn more about the bidder’s services. All too often, SFAs issue RFPs, but they rarely request proposals. Remember to include value-aligned scoring in the evaluation and scoring rubric. Evaluation criteria can consist of many things, such as how many organic items a bidder offers, whether a bidder would be willing to pick up products from new vendors or local farmers, what other sustainable products they sell, and so on. Consider using a geographic preference for formal procurements, and when writing product specifications, include the manufacturer name PLUS the or equal (or Equivalent) clause, so you indicate exactly what product you want.

Cost Price Analysis Template

STEP 3: Draft Solicitations 

There are three types of procurements: micro-purchase, small purchase, and formal. There are many ways to issue a procurement, including a forward contract, Invitation for Bid, Request for Proposal, etc. A good solicitation should include, at a minimum, a clear description of the item(s) to be purchased, the quantity of the item(s) to be purchased, the duration of the purchase (or contract), delivery locations, and evaluation metrics as it relates to the award (by price only, point system, etc). Solicitations increase in complexity as the purchasing thresholds increase, and there are different requirements for informal and formal solicitations. The key is to draft a solicitation, especially for formal procurements, that is fair and open for potential bidders. It allows small farmers, food hubs, and other entities to offer the department an opportunity to procure these goods more easily from them.

CAF Solicitation Templates:

Informal Solicitations:

• Informal Request for Quote (RFQ) with Included Pricing Worksheet
• Informal Request for Quote (RFQ) with Excel Pricing Worksheet

Formal Solicitations:

• Formal Request for Proposal (RFP) with Included Pricing Worksheet
• Formal Request for Proposal (RFP) with Excel Pricing Worksheet
• Formal Invitation to Bid (IFB) with Included Pricing Worksheet
• Formal Invitation to Bid (IFB) with Excel Pricing Worksheet

Micro-Purchase

• Micro-Purchase Email Template
• Micro-Purchase Self-Certification Workbook

STEP 4: Place USDA Foods Order

The value of USDA Foods to an SFA’s bottom line cannot be understated. USDA Foods make up between 15% and 20% of products served in the school lunch and breakfast programs. SFAs will always need to use their entitlement and USDA Food allocations. USDA Foods orders must be placed a year in advance and should be done with the new menu in mind.

STEP 5: Publicize Solicitations

Publishing informal solicitations is much less complicated than publicizing formal ones, so it is often used to procure local and values-aligned foods. Informal solicitations are not required to be publicly posted and should be sent to a minimum of two vendors, but best practice is three. They can be sent out anytime during the school year and “issued” by email, phone call, or in person. It is important to remember that regardless of the method of issuing an informal solicitation, an SFA must issue the same solicitation to all vendors (they must receive the same information). Due to the simple nature of informal solicitations, they do not require extended periods for vendor responses, but it is important that you provide enough time for a responsive reply. 

Formal solicitations must be publicly advertised, and seek two or more qualified sources willing and able to compete. Any qualified vendor must be allowed to respond. An SFA must also allow ample time for vendors to respond. Depending on the complexity of the solicitation, it is recommended that vendors have at least 30 days to respond. A date and time for submission must be included in the solicitation. 

SFAs must maintain paperwork or records related to solicitations, both formal and informal, for up to three years. SFAs may want to use this Solicitation Tracking Tool to manage communications between the SFA and potential vendors.

STEP 6: Accept Bids and Proposals + Evaluate Bids and Proposals

In general, when a solicitation is received, and before an SFA evaluates the technical merits of the bid, it will want to quickly determine if the vendor’s submission was responsive, if the vendor is responsible, and if their submission included all required information and materials. If all of these are true, the submission should be considered for evaluation.

Evaluation of informal bids is based on price alone. The bid must be awarded to the lowest bidder.

Geographic Preference is allowed to be used to evaluate informal bids, but requesting bids from only local vendors is acceptable with informal solicitation, so it may not be a necessary tool in evaluating informal solicitations. 

Evaluation of Requests for Proposal (RFP) are not required to be sealed and opened publicly. Still, it is recommended to follow a similar process for accepting and processing RFPs as those used in Invitation for Bids. Requests for Proposals should be opened after the closing date and can only be evaluated based on the criteria outlined in the RFP. When issuing an RFP, evaluation criteria must be clearly stated in the solicitation. Negotiations may occur with vendors that submit bids, and awards may be made to vendors that are most advantageous to the program. Price is not the only factor by which a proposal is evaluated but it should be the primary consideration. RFPs should contain a technical proposal that explains how a vendor will accomplish the requested task and a cost proposal detailing how much it will cost to accomplish the task proposed. When evaluating RFPs, an SFA must first evaluate the technical proposal and then consider the cost of this proposal. From there, select the vendors to be interviewed, negotiate with, or award the contract to the vendor that presented the best overall value to the SFA.

Evaluation of Invitations for Bids (IFB) must be opened publicly at the time and location specified. A contract is awarded to the vendor whose bid conforms to the terms of the IFB at the lowest price. When issuing an IFB, an SFA will seek to establish a fixed-firm-price contract, meaning pricing will be fixed at a set price for an agreed-upon amount of product sales. Depending on how the solicitation was written, an IFB can be awarded line item by line item or as one lot. 

STEP 7: Award Contracts

Once a vendor is selected, notify the vendor with adequate information and time to onboard the new vendor before the school year starts. It depends on the contract, but many contracts are for one year with the option to renew for up to four additional years.

STEP 8: Getting Ready for Next School Year

While this is not a procurement stage per se, once contracts for next year are final and vendors are lined up, SFAs can use this time and summer to develop marketing materials or communication plans related to any new items, ingredients, or vendors that will be coming on board next school year.  

STEP 9: Manage Contracts 

SFAs are responsible for ensuring that any vendor partner complies with all terms of the agreement or contract. Contract management is an ongoing process that lasts for the duration of the contract. To determine if the terms and conditions of the agreement are upheld, an SFA may want to pull invoices and check the prices charged against the contract; verify the sources (local, etc.) and quality (organic, fresh, etc.) of food; and document the vendor’s performance by analyzing fill rates, the number of time vendors meet or do not meet delivery windows and general customer service.