Preferred Meals, the company that tried to sue San Francisco Unified School District after losing a $9 million school meal contract to Revolution Foods in 2012, will once again be doing business with SFUSD.
After several failed attempts, Preferred has been awarded the meal delivery bid for SFUSD. This does not mean that Preferred will be delivering their own meals to SF cafeterias; the meals, which are covered under a separate contract, will still come from Revolution Foods. This contract, worth about $1 million, is just for delivery services – picking up meals, food and supplies, and taking them to the schools, as well as some pickup and delivery of cafeteria cash and paperwork.
SFUSD parents will remember that, from the mid 2000’s until the end of 2012, Preferred was the vendor for the meals served in district cafeterias. Although their frozen, reheated lunches represented an improvement over what had previously been served in district schools, over time the relationship soured, with delivery problems and an increasingly loud call from parents and students for better-tasting, fresh-not-frozen, meals. At the end of 2012, Revolution Foods won the contract to become SFUSD’s meal vendor, beating out Preferred.
Regardless of who the meal vendor is, delivery of meals is handled as a separate SFUSD contract.
Preferred won this delivery contract because their bid was substantially lower than the only other bidder, previous contract holder J&B Delivery. Price is always the determining factor; SFUSD is required to award such contracts to the firm with the lowest bid. The relatively low price of the contract is good news for SFUSD’s Student Nutrition Services department, which chronically runs a deficit upwards of $2 million dollars a year.
In fact, Preferred’s bid was so low that it is unlikely they will earn any profit on the contract.
Why would a company whose core business is the manufacture and sale of frozen meals be so eager to land a contract to deliver someone else’s product?
Perhaps after losing SFUSD’s meal business at the end of 2012, and also losing legal action intended to retain that business even against SFUSD’s will, Preferred is now looking for a way – any way – of once again doing business with SFUSD.
Perhaps their thinking is that they will start with the delivery contract, and try to show that they can be a good partner for the district, with an eye towards trying to win back the meal contract when it comes up for bid in 2017.
Perhaps they feel that having the opportunity to observe at least some of Revolution Foods’ operations up close will give them some kind of strategic advantage in retaking that meal contract.
While it may seem odd to hire Preferred to deliver their competitor’s meals, obviously SFUSD thinks the arrangement is workable.
A clause in the Invitation for Bids (#65 “References”) would have allowed SFUSD to reject a bid from any company that had done business with the district in the past 10 years if that company was not able to provide a reference from SFUSD itself. The district did not invoke that clause, so clearly someone from within SFUSD provided a positive reference for Preferred, despite their previous performance problems and their attempts in 2012 to block the Revolution Foods meal contract.
If there is still any lingering bad feeling around how things played out in 2012, Preferred Meals and Revolution Foods will need to put it aside. Like it or not, the new delivery contract means that these two competitors will need to work cooperatively to get meals to SFUSD’s students in a safe and timely manner next school year.
Dana Woldow has been a school food advocate since 2002 and shares what she has learned at PEACHSF.org. Follow her on Twitter @nestwife, or read more than 140 characters of her writing in her complete archive.Filed under: Soda Tax/Food Politics