The following document is designed to help Houston Food Bank Directors gain insight into how purchasing at HFB works. While it is the responsibility of the Director to oversee their department budget as well as manage their vendors, the Procurement Department is available to aid in purchases, contract management and compliance, and help find cost savings. Below you will find high level information about the Procurement Policy and how the procurement department supports Directors.
Purchasing Team
The Purchasing team, made up of a Manager, a Specialist, and an Analyst, specializes in procuring food, operational equipment and supplies, and services at competitive prices. Through a requisition process and ticketing system, they aid departments in vendor selection, price negotiation, cost analysis, and the creation of Purchase Orders within the Netsuite System. They also utilize a Contract Lifecycle Management (CLM) tool to manage HFB contracts. The Manager of the team serves as subject matter expert on the Procurement Policy.
Procurement Policy
It is the policy of HFB to follow a practice of ethical, responsible, and reasonable procedures related to purchases, contracts, agreements, and related forms of commitment. All procurement transactions must be conducted in a manner that provides open competition, free from real or perceived conflicts of interest that adhere to all federal and state procurement guidelines.
The Houston Food Bank adheres to a procurement policy primarily to ensure HFB is being good stewards of funds. As an operator of programs like TEFAP and CSFP, the procurement policy ensures compliance with the terms and conditions set forth by these programs. The policy also promotes vendor competition, reduces waste and fraud, promotes cost savings, and aids in reducing waste. The Procurement Policy can be found here.
Authorizations and Purchasing Limits
HFB has established purchasing approval limits by organizational level and amount, as shown below.
HFB’s financial policy states that those managers with signature authority can approve orders for their department, up to $25k. All Directors can approve up to $50k. Netsuite workflow is designed to automatically send the approval request to the appropriate employee based on the department coding that is provided. Each request submitted will issue an e-mail notification to the appropriate employee and within that email, a link will be included to approve that request.The Procurement team will only fulfill requisition requests after the required authorization. The most recent version of the Signing Authority document can be requested from the Accounting Team.
Procurement Methods and Requirements
There are multiple procurement methods based on the funding source. For all requisition requests, the Procurement team will default to the “TDA cost pool” method. If federal funds are used for your expenditures, those purchases must flow through the Procurement team.
HFB Purchasing Methods-
Requisition Process - NetSuite
To ensure a smooth and efficient purchasing process, all staff members must submit a requisition through NetSuite for the acquisition of food and goods. Depending on spend authority, that requisition may need further approval. Once approved, the purchasing team will utilize the information provided to find the best purchasing option. Detailed instructions on how to create requisitions within the system can be found here. You will notice that you may not select any dates within the 72 hour window following the request date. This is in order to provide you quality customer service and best set expectations around timeliness of an item delivery. This may require you to plan further out for your purchasing needs.
Project Based Purchases -
For project-based purchases, a dedicated ticketing system has been created on Knowledge Base and is linked here. This system serves as a centralized platform for all procurement-related requests where the requester knows additional stakeholders need to be involved or communication,beyond what is required in a requisition needs to be relayed to the purchasing team.
To use this system, simply navigate to the Knowledge Base and select ‘Procurement Requests’ from the dropdown menu. This system is designed to handle a variety of procurement needs, including:
- Software Requests: For requesting new software or changes to existing software. In addition to flowing to Procurement, these tickets will also be assigned to the Data and IT teams.
- Purchase Contracts: For informal and formal long term purchase agreements
- One-Time Purchases: For non-recurring informal or formal procurement needs
- Food Purchases: For assistance with purchasing food by the pallet
- Vendor Support: For inquiries on vendors, vendor and product selection,product returns, exchanges, and requests for quotes.
Formal Procurement:
Formal Procurement procedures are initiated when costs exceed $50,000 and are funded with federal dollars. This process typically spans 6-8 weeks, from initial internal discussions to contract execution. Initially, it is determined whether an Invitation for Bid (IFB) or a Request for Proposal (RFP) will be executed.
- IFB: Invitation for Bid, is used when one-time purchases based solely on the lowest cost
- RFP: Request for Proposal, evaluates a variety of predetermined factors, and is scored by internal staff to determine best fit
Once determined, the requesting department outlines the scope, upon approval, it is then posted and open for 2 weeks on the Houston Food Bank website for public bidding. Following the bid opening:
- IFB: If the scope fits HFB’s needs, the company with the lowest cost is selected.
- RFP: Procurement does a cost and spec analysis, and the department grades with a predetermined scoring matrix.
Once the preferred company has been selected, the bid is awarded through an award letter and if necessary, works with Accounting to create a new vendor. This concludes the procurement department's involvement in this process.
Docusign CLM:
Houston Food Bank utilizes Docusign CLM, an online platform, to oversee the complete lifecycle of contracts. This involves uploading contracts along with their commencement and expiration dates. This system will help Directors avoid surpassing contract deadlines and notifies stakeholders in time for renegotiation or cancellation. All Directors will soon have access to their contracts through this system and all documentation will be archived for future audits.
HFB’s new CLM through Docusign will be ready by July 2024.
Choice Partner:
HFB sometimes utilizes a cooperative purchasing group called Choice Partners who offer procurement and contract solutions. Choice Partners complete the legal, competitively bid government procurement process so that HFB can quickly access the goods and/or services on that contract without having to go through the entire bid process. The Kid’s Cafe Department typically uses Choice Partners for the CACFP and SFSP programs, however any department can utilize. You can find a list of their available contracts here.
To effectively leverage the support of the Procurement Department, Directors should understand the following key points:
- Budget and Vendor Management: Directors oversee their department budgets and manage their vendors. However, the Procurement Department is there to assist in these tasks, helping to find cost savings where possible.
- Purchasing Team’s Role: The Purchasing team is your go-to for procuring food and goods at competitive prices. The Purchasing team can handle vendor selection, price negotiation, and cost/price analysis to secure the best deals. They also assist in audits and help Accounting streamline vendor payments.
- Adherence to Procurement Policy: All procurement transactions must adhere to the Procurement Policy, which ensures ethical, responsible, and reasonable procedures. This policy is crucial for legal compliance, financial efficiency, and operational effectiveness.
- Understanding Approval Limits: HFB has set purchasing approval limits by organizational level and amount. Managers can approve orders up to $25k, while Directors can approve up to $50k. Requisitions over the $50k threshold require approval from both the Director and the Executive team member.
- Requisition Process: All staff members have access to submit requisitions through NetSuite. Managers or Directors will receive an e-mail notification requesting approval, based on signing authority. Once approved, the Purchasing team will locate the best purchasing option and a PO will be created.
By understanding and following these guidelines, Directors can effectively utilize the support of the Procurement Department to aid their operations and contribute to the mission of the Houston Food Bank.
Purchasing Team Contacts
For assistance with various aspects of Procurement’s operations, please direct your inquiries to the appropriate members of the Purchasing Team:
Procurement Manager, Joseph Williams (Jwilliams@houstonfoodbank.org): For all matters related to the Procurement Policy, vendor management, and product pricing.
Procurement Specialist, Rin Pavlicek-Hoff (choff@houstonfoodbank.org): For inquiries regarding the placement of orders, office/program/operational supplies, quotes, and requisitions.
Procurement Analyst, Afnan Rahim (arahim@houstonfoodbank.org): For all inquiries regarding contracts and formal purchasing bids.
The Procurement Department appreciates your cooperation and looks forward to assisting you with your procurement needs.