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Operations

The ins and outs of forming a purchasing collective

Purchasing more local, sustainable products is a priority for operators nationwide—but it’s not always financially or logistically feasible. That’s the situation Kathy King, dining director at Wake Robin continuing care retirement community, and other Vermont operators were facing when they started discussing the issue at an annual retreat. The Vermont Work Group, a purchasing collective of 12 hospitals and healthcare facilities, was born of these conversations. farm collective

“We were all looking to buy more local and sustainable products, and we weren’t getting those kinds of items from our broadline distributor,” Shelburne, Vt.-based King says. “So we thought that if we joined forces together, we would be more successful.”

That success resonates throughout noncommercial foodservice, as operators are able to not only source sufficient amounts of the products they’re looking for, but also enhance their communities by bolstering the stability of local businesses. About 94% of college and university operators and 56% of senior living operators  are buying at least some of their products locally, according to data from FoodService Director’s 2016 Foodservice Handbook.

The vast purchasing needs at the University of Montana have helped build the local growers cooperative into a fiscally sound hub of farmers, says Mark LoParco, director of dining. “The market for locally grown foods has been a win-win, because we can go to the co-op and get products that we need, and they can have a reliable source in terms of sales,” he says.

Operators overwhelmed by the ins and outs of sustainable purchasing should start with the low-hanging fruit, LoParco says, using the example of oil at the Missoula, Mont., school. UM was using a half-dozen different oils, but realized that safflower oil could be substituted for almost all of them. “Is it more expensive? Yes,” he says. “However, you’ve got to follow the oil’s life cycle.” Safflower also happens to be the best type of oil for converting into biodiesel, so UM’s used product, purchased at a discount, is returned to the producer to make into fuel for its farm equipment.

Open conversation is another key starting point, says King. The Vermont Work Group created a conference, and invited distributors and state representatives to talk about creating more sustainable purchasing options. “It helped us understand some of the distributors’ issues,” she says. Local farmers often aren’t able to afford expensive insurance policies the distributors required. “Because of the conversation, [the distributors] were able to lower it for a couple of folks,” she says.

With the future in mind, LoParco is working with the growers co-op and a local food incubator on co-purchasing equipment to create more value-added products, such as pre-cut carrots, to help UM save on labor costs. “Instead of paying $10 a bag for processed carrots, we might pay $8 or $7, and in turn they’re able to turn around and use that piece of equipment to make sales that aren’t discounted [to other buyers],” he says of one recent cost-benefit analysis. “It puts more value into carrots for everybody.” In this scenario, the equipment ended up being affordable enough that a co-purchase didn’t make sense, but “these situations will continue to happen,” he says.

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