Scaling Up Sales to Institutions

34,000 meals per day in Vermont.  45,000 lbs of chef potatoes, 27,000 lbs of tomatoes, and 29,000 lbs of broccoli per year.  The Sodexo corporation has contracts with 26 organizations in Vermont for food service.  This includes UVM, VT State Colleges, a couple of private colleges, a few high schools, Rutland public schools, plus a few more.

Scaling Up Sales to Institutions was a forum held on 11/7/12 at UVM, sponsored by The Farm to Plate Network, Agency of Agriculture, and Sodexo.  The purpose was to get VT farmers, food hubs, and small processors talking with a large food buyer to understand what is necessary to sell to such a buyer.  Sodexo is very interested in local food because their customers are very interested in local food.  UVM has a goal of using 20% VT produced food by 2020.  Vermont’s state goal is to get to over 10%.  How does a VT farmer get a piece of that action?

photo by Caylin McKee, Sodexo

First, realize that all meals that Sodexo makes for an institution, say UVM, are not created equal.  Sodexo has 3 types of meals.  1) Residential.  These are the classic meal service, dorm meals.  This is a contract meal, for less than $3.  Local food has to be very price-competitive to fit in on this level.  This is a seasonal market that follows the school year, so that abundance of mid-summer produce just does not match their demand.  National brands and commodity products fit in well here.  2) Retail or ala-carte meals.  This is where people choose what they want, and pay for each item.  They can charge the customer for the local, grass-fed hamburger.  3) Catering.  This is the special events market.   There is quite a bit of flexibility here.   What does the client want?  The client will get it and must pay for it.

Two Sodexo District Chefs, Brian Roper and Rob McFarland discussed how a VT producer can get their product in the door.

  • Sodexo is concerned with SAFETY, PRICE, and AVAILABILITY.
  • Know your product.  It has to be consistent.
  • Know what your volume is and could be.
  • Know when you will have the volume of product.
  • Be willing to negotiate (on everything, including price).
  • Sodexo will want to sample your product.  If they like it and think it may work, they will want to have students sample your product.
  • They have had experience with a VT product that they liked, and the students liked.  But the producer could not keep up with demand.
  • Be ready to tell your story.  Sodexo tells the story of their local producers to their customers.
  • Expect to go through a distributor:  like Black River Produce or Best of Vermont.
  • You will need product liability insurance of $ 5 million.  Your premium is based on your gross sales.  You may be partially covered by your distributor’s policy.
  • Expect to have annual inspections.

Joe Bossen, VT Bean Crafters, talked about information flow.  Joe had a vegetarian burger that was selling well at the Rutland Farmer’s Market.  He wanted to start working with Black River and expand his sales.  Black River had him wait until their spring food show.  His product did well at the show and made it into Black River.  After a while, Joe rode with Black River as they were delivering his product so he could meet and talk with people at the stores that were selling his product, including Sodexo.  He was able to get some ideas from these people about other products that they might be interested in carrying.  Joe has developed a couple of new products, even one that could get into the Residential market.  With a new assortment of products, Joe has talked to a private college about how his products could fit into their meal plans.

One surprising thing to me was to learn what a bottle-neck loading docks are.  Loading docks are scheduled, so each company has their time to be at the dock.  You must wait til the guy in front of you is done.  Plus at UVM, trucks are not allowed to unload at the dorms until a certain time in the morning.  The question for the group on the day was this “Is waiting in your truck at a loading dock the best use of your time?”

The forum was a great way to learn about how one large institutional food buyer thinks about procuring local food.  Understanding their requirement to serve 34,000 meals per day was an eye-opener.  Then to hear that the bulk of these meals are from September to May!  Hopefully information from the day will get more Vermont foods onto these institutional plates.

VT Farm to Plate Network

UVM Food Services

VT Agency of Agriculture

Black River Produce

Best of Vermont

Vermont Bean Crafters

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About Dennis Kauppila

I work with farmers on finances. I started with UVM Extension in 1983, and have worked with hundreds of farmers on issues ranging from starting a farm, how to get a loan, leasing a farm, understanding farm finances, to retiring from farming. I teach 1 or 2 courses for farmers each winter. I am working with several farmers now on business plans, and I continue to work with many farmers on balance sheets and budgeting.
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