10 Reasons Many School Food Programs are Operating in the Red

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Written by Milt Miller – School Food Programs nationwide are struggling to stay in the black. Many are not succeeding, showing deficits in excess of $100K or more. The amounts of “Red Ink” spilling from school food programs since 2010 is astounding. To what can this be attributed? The new guidelines? High amounts of plate waste? Significant decreases in participation? Large amounts of unpaid lunch accounts? Increased cost of compliance? There are as many reasons, excuses, and theories as there are stars in the heavens, but it all boils down to ten main reasons why school food programs are bleeding.

In my experiences working with school nutrition programs, that are struggling to become self-sustaining, I find a combination of the following ten reasons why they are in the red.

  1. Outdated Labor Models, resulting in unmanageable salary and benefit costs
  2. Outdated Menu Offerings, that no longer meet student customer expectations
  3. Lack of Sound Purchasing and Procurement Procedures, resulting in excessive plate costs
  4. Ineffective Marketing, resulting in students and parents not knowing what is being offered and what is happening in the café
  5. Non-compliant or Nonexistent Charge Policies, resulting in high amounts of unpaid lunch accounts
  6. Under utilization of Available Technology, resulting in poor tracking and reporting procedures, that hamper the making of informed decisions
  7. Underdeveloped Food Handling, Customer Service, and Meal Recognition Skills, resulting in decreased participation and revenues
  8. Ineffective Free and Reduced Meals Application Procedures, also resulting in increased unpaid lunch accounts and loss of federal and state funding
  9. Adopting or Dropping out of a Federally Funded Program without Sufficient Research, resulting in the loss of unrecoverable revenue sources
  10. Inability to Admit there Is a Problem (The most significant reason), resulting in continued deficits year after year

Most of these issues go unnoticed because administrators have become desensitized, by being in their operations day in and day out and they just don’t see the eminent danger to their programs, until it’s too late. Once they start to see the deficits pile up many times they are in denial and don’t want to admit they have a problem. Many times it takes a set of fresh eyes to see what is really happening. Ask yourself these questions:

  • Are our revenues steadily decreasing?
  • Is there a significant amount of unpaid lunch accounts?
  • Are food costs above 38% of sales
  • Are Labor Costs above 52% 

If you have answered “Yes” to any of these questions, you have a potential unimagined problem. The next three questions can mean the difference in bleeding red or getting back on track.

  1. What is my next step? 
  2. Can I handle this myself? 
  3. Where can I get help? 

Milt Miller is the Principal and Chief Innovator at Milton Miller Consulting. Throughout his 32 years in the food service industry he has managed, operated and assisted food service programs to become successful. For more information on this and other topics, contact Milt at; www.miltonmillerconsultant.com

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