GETTING THE MOST BANG FOR YOUR USDA FOODS BUCK

GETTING THE MOST BANG FOR YOUR USDA FOODS BUCK

ACRONYMS DoD = Department of Defense FNS = Food and Nutrition Servicesd FDP = Food Distribution Program RA (s) = Recipient Agencies WBSCM = Web Supply Chain Management

WHY IMPORTANT?

MENU PLANNING Plan Menu Use a Cycle Menu Request USDA Foods To Match Menu Menus Are In The Driver s Seat for USDA Foods Utilization!

CONSIDERATIONS Menus Entitlement Available Donated Food (DF) Value Delivery Minimums Additional Costs Delivery Storage Processing

DISTRICT SPECIFICS Average Daily Participation Distribution Storage Costs Involved

STATE USDA FOODS PROGRAM Items Available Request System Delivery and Storage Costs Involved

USDA FOODS REQUEST

USDA FOODS AVAILABILITY LIST 168 Items Posted On Line http://www.fns.usda.gov/fdd/foods-expectedbe-available

DOD FRESH FRUIT AND VEGETABLE PROGRAM Fresh Produce Delivered Weekly Local Items On Order Guide Minimum Orders Vendor Selected by DoD

TRUE VALUE OF USDA FOODS Value of USDA Food + State Charges/Fees + Processing Costs/Fees + Storage/Handling/Delivery Fees = True USDA Foods Value

EASTERN SHORE POTATOES 12.00 per case USDA Food/ 18.00 per case Commercial +0 State Fee +4.00 per case Delivery Fee +5.00 per month Storage Fee After 30 Days 17.00 per case USDA Food After 31 Days 22.00 per case USDA Food After 61 Days

MAXIMUM ENTITLEMENT USAGE

WHAT WOULD YOU RATHER SAVE?

BULK FLOUR

POTATOES

BULK TOMATO PASTE

BULK APPLES

ENTITLEMENT Entitlement represents the VALUE of the food that you receive Entitlement is NOT out-of-pocket money but the value is real

WELL HOW MUCH ENTITLEMENT DO I HAVE? Effective rate is about 0.30 per reimbursable meal (free, reduced & paid) The rate is subject to change every year

CALCULATING ENTITLEMENT Total lunch meals served for prior school year (updated periodically) x the commodity rate of assistance = Estimated entitlement For example: 1000 x $0.3000 cents = $300.00 Link for meal assistance rates: http://www.fns.usda.gov/fdd/regs/mealrates.htm

USDA FOOD VALUE PER POUND Bulk Flour 22.6 cents Potatoes 10.5 cents Tomatoes 46 cents Apples 36 cents Total 1.15

USDA FOOD VALUE PER POUND Big Four 1.15 Chicken.976 Turkey 1.16 Beef 3.54

DIVERSIFY Big Four 8.5 Million Pounds Beef 1.5 Million Pounds Chicken 3 Million Pounds Pork 750,000 Pounds Cheese 2.5 Million Pounds Turkey, Eggs, Peanut Butter, Fish

DIVERSIFY 48 Trucks Canned/Frozen Fruit 23 Trucks Canned/Frozen Vegetables $1,000,000.00 DOD Fresh Fruits and Vegetables

AM I GETTING A GOOD DEAL? How Do You Know?

USDA FOODS DIRECT DELIVERY Entitlement cost only charge from USDA Items may be subject to distribution fee from state warehouse Minimum direct quantity of ¼ truck; trucks may make 3 delivery stops

PROCESSING USDA FOODS USDA purchases and diverts on behalf of RAs Manufacturers create Heat & Eat items for RAs Manufacturers charge a fee to RAs ~ Adds out of pocket cost

DOD FRESH FRUIT & VEGETABLES Allows entitlement use for domestic produce Contracting is handled by the DoD High demand for menus

EVALUATING OPTIONS How do I get the best use of my entitlement?

EFFECTIVE USE OF ENTITLEMENT USDA Foods (commodities) Menu Nutrition Customers Cost Storage

USDA FOODS DIRECT DELIVERY Example: Case of peaches commercially at $39.00 per case bid price. Entitlement value of $31.00 per case If delivery fee is $3.50 per case with entitlement use. Total cost? Other fees? $34.50 per case ($3.50 out of pocket) They must be considered and evaluated

COMMODITY PROCESSING It s Not As Bad As You Think

WHAT SHOULD I CONSIDER Menus Labor Food Safety Volume of product to be purchased? Procurement process at local or state level Agreement with processor Tracking purchasing Sales, delivery, and receipt of end products Monitoring and auditing of processes

READING A SEPDS Cost per donated pound (.7219) Lbs. Required for one case of product (4.20) Total discount based on value of product in one case

CALCULATING VALUE 100 cases of apple fruit pockets Calculation: 100 cases X 4.20 (lbs.) = 420 lbs. of donated food required My discount on 100 cases = $303.00

GOOD USE OF ENTITLEMENT? Answer: It depends Based on prior example: 100 cases X 4.20 (lbs.) = 420 lbs. of donated food required My discount on 100 cases = $303.00 If your delivery fee is less than $3.03 per case, you may consider this a deal; if not, you are losing money

COST BENEFIT ANALYSIS FOR PROCESSING USDA Food Ground Beef (A594) WBSCM # 100154 USDA Value $2.2874 Processed USDA Foods Commercial Equivalent Annual Savings Manuf. Product Description Case Servings / Weight Case Process Cost Storage / Delivery DF / Case DF $/Case Total Cost Cost / Portion Commercial Cost Servings / Case Cost / Serving Savings / Serving Annual Servings Cow Chow Beef Patties 20.31 135 $14.17 $0.00 20.1 $45.98 $60.15 $0.45 $71.11 135 $0.53 $0.08 10000 Annual Savings $812.0 9 Moo Moo Beef Crumbles 40 256 $39.70 $0.00 31.07 $71.07 $110.77 $0.43 $121.05 135 $0.90 $0.46 10000 $4,639.7 3 Cow Chow Beef Patties 20.31 135 $14.17 $3.50 20.1 $45.98 $63.65 $0.47 $71.11 135 $0.53 $0.06 10000 $552.8 3

COST BENEFIT ANALYSIS FOR PROCESSING USDA Food American Barrel (B049) WBSCM # 100010 USDA Value $1.8003 Processed USDA Foods Commercial Equivalent Annual Savings Manuf. Product Description Case Wt. Servings / Case Process Cost Storage / Delivery DF / Case DF $/Case Total Cost Cost / Portion Commercial Cost Servings / Case Cost / Serving Savings / Serving Annual Servings Annual Savings Moo Moo Moo Moo Moo Moo Cheese Stick 10.5 168 $13.44 10 $18.00 $31.44 $0.19 $35.45 168 $0.21 $0.02 10000 $238.51 Cheese Stick 10.5 168 $13.44 $3.50 10 $18.00 $34.94 $0.21 $35.45 168 $0.21 $0.00 10000 $30.18 Cheese Stick 10.5 168 $13.44 $3.95 10 $18.00 $35.39 $0.21 $35.45 168 $0.21 $0.00 10000 $3.39

COST BENEFIT ANALYSIS FOR PROCESSING USDA Food Apples WBSCM # xxx-xx USDA Value $0.2900 Processed USDA Foods Commercial Equivalent Annual Savings Manuf. Product Case Servings / Description Weight Case Process Cost Storage / Delivery DF / Case DF $/Case Total Cost Cost / Portion Commercial Cost Servings / Case Cost / Serving Savings / Serving Annual Servings Annual Savings Granny Granny LongGranny Apples 6/#10 27 144 $20.50 $0.00 $20.50 $0.14 $29.85 144 $0.21 $0.06 10000 $649.31 Apples 6/#10 27 144 $20.50 $3.50 $0.00 $24.00 $0.17 $29.85 144 $0.21 $0.04 10000 $406.25 Apples 6/#10 27 144 $20.50 $6.50 $0.00 $27.00 $0.19 $29.85 144 $0.21 $0.02 10000 $197.92

COMMON PITFALLS Not taking time to evaluate your school districts menu and usage needs Thinking of USDA Foods as free Not utilizing all the available options Committing to process items you have not served/tested with your students Processing items that are not on menus throughout the school year and/or changing menu Inadequately managing, tracking, and/or verifying receipt of further processed items

CONTROL YOUR USDA FOODS DESTINY Verify Planned Assistance Level Regularly Monitor Direct Delivery USDA Foods Deliveries Manage Inventories Verify Commodity Pass Thru Values Don t Change Menus Before Product is Used

CONTACT INFORMATION Michael.Birkmeyer@Maryland.gov 410-767-0206 Lena.Harris-Wilson@state.co.us 303-866-2535