Advice on conducting local procurements at produce auctions 102814 final...

1. Advice on Conducting Local Procurements at Produce Auctions
10/28/2014
A competitive procurement at local produce auctions would be done via informal procurement
method, as no solicitation would be written or advertised ahead of time due to the inherent
structure of produce auctions.
To conduct an informal procurement via produce auction:
1) Conduct research ahead of time to see what the average market prices may have been
in the past week. To do so you can use AMS terminal market pricing indexes, you can
use local auction pricing indexes that publish the past weeks/days auctions prices
and/or AMS’s local pricing index. This research ensures that you are well-informed prior
to attending the auction and you know what price point you can expect.
2) Gather three quotes by:
a. Contacting producers at farmers markets, other specialty crop producers with
commercial sales channels and/or distributors, prior to going to the produce
auction. Then use the produce auction as one additional quote gathered on the
day of procurement. If the auction quote is the lowest, make the purchase.
b. Attending the auction and getting three quotes from either a lot or mix
of producers and purchasing the lowest cost item. Prior to attending try to
ensure that the auction you will attend has at least three different producers for
the products you want or that three different lots of that one product will be
sold at that auction. Your prior research will help ensure that you are getting a
good value.
3) When the purchase is complete, document the research conducted ahead of time,
document vendors (or lots) at the auction and document prices paid for the food
purchased.
Remember it is also recommended to have a written specification of the product you are
looking to purchase to ensure that all quotes you gather are for comparable products.
Note many SFAs work with a third party broker when purchasing from an auction. The broker is
acting on behalf of the SFA, so all the same procurement rules apply.