In 2018 and 2019, with the help of Karen Karp & Partners, four NYC-based anti-hunger organizations—New York Common Pantry (NYCP), Project Hospitality, St. John’s Bread and Life (SJBL) and West Side Campaign Against Hunger (WSCAH)—researched and launched a pilot collective purchasing program. They wanted to see if coordinating their purchasing activities would help save money, allowing them to provide their clients with improved access to high-quality food, such as lean protein, fresh produce and fresh milk.

Representatives from the pantries and KK&P Senior Consultant Ben Kerrick presented the lessons they learned and what they each saved from the collective purchasing program at a breakfast panel on January 22, 2020, hosted by the New York State Health Foundation. New York State Health Foundation, along with Sea Change Capital and Robin Hood, funded the project. Attended by around 50 people, the panel gave attendees the chance to learn about the successes and challenges of the program as well as talk about future partnership opportunities that could benefit anti-hunger organizations.

An estimated 1.4 million New York City residents rely on emergency food programs, including soup kitchens and food pantries, each year. Yet, high food prices and limited budgets often constrain these programs’ ability to meet their clients’ demand for high-quality, nutritious, culturally appropriate, and appealing food. 

“We came together with the question of, ‘Can we get better food for our customers,’” WSCAH Executive Director, Greg Silverman said.

Collectively, the four organizations spend about $1.2 million on food (exclusive of grants from the federal, state, and city governments) and serve more than 5.7 million meals per year. The goals of the pilot program were: provide New Yorkers with access to more high-quality food; save participating organizations at least 5 percent on purchased food; help the organizations to collaborate more effectively; and define additional collaboration opportunities.

“If we’re going to move the needle at all on alleviating hunger, we need to work together,” said WSCAH Senior Director of Programs Alyson Rosenthal.

From August 2018 through February 2019, the organizations worked together with KK&P to identify collective purchasing opportunities. This took a tremendous amount of effort on the part of the organizations. They each went through all their food purchase invoicing for the past year, entering it into a consistent digital format. Collectively the organizations entered more than 10,000 individual item purchases (more than $2 million in spending) into a database.  

After completing the data entry, representatives from each organization and KK&P met to review the data and discuss opportunities for collective purchasing. While during the 2017-2018 year, the organizations purchased food from 19 different food vendors, they were able to identify six vendors—Dagele Brothers, Derle Dairy, Driscoll, Cream-O-Land, Baldor, and for a portion of the pilot, Greenmarket Co.—to participate in the program.  

• Driscoll’s role was facilitated through the New York State Contract Extension Program. The program allows charitable organizations to access the same competitive pricing available to New York’s state agencies. 
• Food & Supply Source, a national group purchasing organization (GPO) that negotiates competitive prices on behalf of its members,  made the relationships with Baldor and Cream-O-Land possible.
• Greenmarket Co. created a tiered volume discount program specifically for the group of pantries. 
• Dagele Brothers and Derle Dairy were already serving NYCP before the pilot; their competitive prices were extended across the participating groups.

During the pilot, which ran from April – September 2019, organizations submitted invoices to KK&P, who logged and analyzed the purchasing data. Representatives from each organization also completed frequent online surveys to track the qualitative aspects of the pilot vendor relationships, such as customer service, product quality, and ongoing challenges and successes. 

“It was challenging. You had to go to the vendors, but you also had to look at what really works for your organization, not every vendor fits every group,” said Sister Caroline Tweedy, Executive Director of SJBL.

The team held monthly conference calls throughout the pilot to discuss their progress, reflect on experiences, share information and troubleshoot challenges as they emerged. 

Over the six months of the pilot, the four organizations spent just over $370,000, about 58% of all documented spending, through the pilot vendors, with an estimated savings of almost $70,000 across the four organizations – or over $160,000 extrapolated annually.

The organizations are now looking for ways to continue to collaborate through collective action where they may invite additional pantries to join, attempt to create additional beneficial purchasing arrangements, and also by exploring collaboration on infrastructure and other topics. KK&P will be continuing its role in facilitating the collaborative efforts of the group. 

Click here to read the full report on the program.