Why is the Alliance working with GPOs?The Alliance consistently sees “budget” as one of the biggest barriers to serving healthier school meals. Today, schools are faced with one of the toughest budget situations in history and at the same time they are expected to serve healthier items (including fresh fruits and vegetables) that typically cost more.
- We believe that GPOs can provide a solution where schools are able to offer those healthy items while improving their entire procurement process. These savings can enable schools to not only purchase different items, but also enhance their labor to add creativity back to the kitchen. Regardless, we believe a healthier bottom line may equal a healthier school.
Will GPOs deliver my district? Yes, the Alliance is working with some of the biggest GPOs in the country and they are dedicated to meeting your needs. If you are concerned that your district may be outside the coverage area of a GPO, please contact the company directly through the links on our page and confirm the availability of their service.
Is there a fee to join a GPO?Some GPOs have no membership fee; others have a small yearly fee based on volume.
How do GPOs make money? Some GPOs charge administrative fees to the manufacturer per item sold. This fee does not go above 3 percent and this fee is charged to the manufacturer, not the school. Other GPOs charge membership fees (see above). We encourage all school representatives to ask about the GPOs business model to be as informed as possible.
Are GPOs new to school purchasing? No. Currently, more than 600 school districts use a GPO to conduct their foodservice purchasing. Historically, GPOs got their start in the healthcare sector; however, this cost-saving model is quickly expanding into the K-12 sector.
Is it legal for schools to join a GPO? Yes, as long as the school district engages in open competition, considers multiple sources during the bid process, and follows all USDA state and federal procurement guidelines. Contact your state agency to stay informed of all regulations related to the procurement process.
How can my school join? We encourage you to contact one of the participating GPOs to learn how their program can benefit your school. Ask each company to demonstrate how their program would save money based on your individual purchasing history. Work with your state agency to stay informed with all state procurement regulations to ensure open competition.
What are the benefits to joining a GPO? School districts can save up to 20 percent off their food costs by joining a GPO. Overall purchasing can be simplified by utilizing the GPO services to conduct the bidding process. This allows the food service directors and managers to focus their efforts on running a profitable food service operation providing nutritious meals at a competitive cost.
What is the difference between a co-op and a GPO? A cooperative (or co-op) is formed when neighboring school districts join together to agree upon a master bid list of products. This activity can increase buying power and result in better pricing; however, sometimes school districts do not all agree on the products chosen and individual needs might not be met. While co-ops can be an excellent system for some districts and regions, it might not be a good fit for all school districts.
- A GPO is a separate organization that conducts a competitive bid process to secure fixed pricing for a very large product portfolio. As members of a GPO, any school district can have access to these products as needed. The GPOs working with the Alliance have committed to making healthier options available to school customers to ensure they can meet both Alliance Healthy Schools Program and USDA Guidelines.
Will I have limited product choice with a GPO? No. In fact, product choice can be enhanced by joining a GPO. If there are products that your district identifies as needing halfway through the year, instead of going out to bid to secure pricing, often these products are already part of the GPO portfolio allowing immediate access to purchase
My state requires that I do a competitive bid each year. Can I still join a GPO? Yes. We encourage each school district to work with their state agency because procurement regulations vary by state. Some states require that districts go through the competitive bid process each year. Districts can either put out a RFP to work with a Group Purchasing Organization or they can send their bids directly to a GPO for response.