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LA schools foodservice takes big bite out of deficit

There's still a ‘"long way to go" but significant cost reductions are at center of $30 million move toward self-sufficiency.

Los Angeles Unified School District (LAUSD) foodservices, serving one of the nation’s largest, most sprawling districts, has been operating in the red for some time. A little less than a year ago, Joseph Vaughn took the helm as director of the Food Services Division and set out to do what he’s done at several previous school districts (most recently Cleveland): Identify ways to turn it around.

For several years, LAUSD has been receiving encroachment support from the district’s general fund. This means that the foodservice department is not self-sufficient. The encroachment has averaged about $50 million per year. While there’s still a long way to go, after the first 10 months of this fiscal year, the department has reduced the encroachment by approximately $30 million.

“Becoming self-supporting is the No. 1 goal for foodservices, and it’s a goal that everyone is focused on achieving,” Vaughn says.

Vaughn has worked closely with the department's senior leadership team, starting last August with intense brainstorming sessions on devising a plan to lower costs and reduce waste.

Before looking for ways to increase revenue, Vaughn was focused on seeing where money was being lost and addressing that first.

“It is a double-edged sword when you’re debating which is more important: cutting costs or increasing revenue,” Vaughn says. “Both are very important. However, I have always believed that you need to ensure that you are operating efficiently before you worry about bringing in additional revenue.”

An issue that came to the forefront of the brainstorming sessions was the procurement of food and menus.

“We spent most of the fall working with the menu staff to create breakfast and lunch cycle that maximized the use of government commodities,” Vaughn says. “And we challenged our cafeteria managers to purchase their cafeteria food in the same manner that they purchase their groceries at home.”

Vaughn illustrates the strategy with an analogy, translating economic truths of shopping for one household to shopping for 1,100 locations to serve 138 million meals per year. 

“Most people look through their kitchen cabinets and make a grocery list of what they need before going to the store,” he says. “Why do they make a list? So they don’t spend too much money.”

So cafeteria managers began going through their inventory each week, making a list and only ordering what they needed for one week at a time.

“This may sound simple, but it was a new concept to most of them,” Vaughn says. “However, it was a concept our managers not only accepted, but embraced.”

Within a few weeks, Vaughn saw results in reduced invoices from suppliers. 

New pilot programs that were quickly green-lighted by the district superintendent and school board members also played a role in the move to reduce waste and improve the quality of meals at the same time.

One program, which brought flavored milk back to school, significantly reduced food waste and boosted meal participation. 

Another pilot program, Hot Suppers, was implemented in November of last year, and has added revenue and also been a big success with students.

Vaughn doesn’t want to lose the focus of serving students even as becoming self-supporting and reducing reliance on the general fund.

“We’re continuing to work towards serving a hot, nutritious meal that tastes good and is healthy,” he says.

Up next, Vaughn says there’s a pilot vegan meal option in the works, beginning in the 2017-2018 school year.

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