News outlets in the past few weeks report that some federal pandemic-era provisions allowing primary and secondary schools to serve universal free meals will expire when districts start school this fall. This has left many districts across the country unprepared to make up the difference. The expiration comes as supply-chain disruptions and rising food prices are pushing school-meal prices higher.
Many foodservice companies count on the K-12 foodservice segment, but it seems each year another hurdle or jumbo roll of red tape is tightened around this channel. While this year it is federal funding at the top of the rotating annual issues, special diets, USDA Foods, product development, student participation and labor retention follow close behind.
In this piece, we share three ideas for suppliers to navigate the ongoing complexities of this important foodservice segment.
1-Become Very Familiar with the USDA Foods Program
The USDA Food program makes available more than 180 frozen, fresh, canned, and dried products. USDA Foods include both raw and processed foods, which go directly to schools or that school districts send to be processed into end products that are incorporated into school meals. Regardless of a supplier’s participation in the program, all sales/marketing teams working in the K-12 segment should be able to speak intelligently on the topic and should be prepared to answer these questions:
- How much do I have to give back to the school and how does this compare to my pricing?
- How much will it cost to track commodities returns?
- Are my competitors processing? If so, are they doing well in the program or struggling?
- Which strategies work best for my organization model?
- Can I comply with the substitution guidelines?
2-Product Innovation and Testing Should Begin with Students
When school foodservice directors compose menus and select products and brands to use in their operations, student demand is the top factor. Acceptance by students is critical, as participation levels dictate government funding. Manufacturers that develop formal product evaluation panels when designing new products will have a head start in product modification.
Sustainability is relatively low on the product selection hierarchy for schools, students today deem it increasingly critical. Outside of local produce sourcing, few schools have formal initiatives around sustainability, most characterize it as a “nice to have” attribute if exhibited by manufacturers
However, the whole area of sustainability should receive top consideration by manufacturers. Students in the classroom are being taught about recycling, energy conservation, and other sustainability issues, and are increasingly becoming aware of these initiatives. Foodservice directors do look more favorably on suppliers that exhibit social responsibility.
The K-12 segment is arguably one of the most complex markets for manufacturers to manage, considering the mandate and regulations by each district within each state. It can be a lucrative opportunity, but persistence and long-term commitment is required.
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