Report to: General Committee Report
Date:
SUBJECT: Award of Request for Proposal 172-R-07
Supply and Delivery of Soft Drinks and Related Equipment
PREPARED BY: Glen Taylor, Manager, Community Centre Operations
Cathy Joyce, Manager, Marketing and Community Partnerships
Tony Casale, Senior
Buyer,
RECOMMENDATION:
THAT the report entitled “Award of Request for Proposal 172-R-07 Supply and Delivery of Soft Drinks and Related Equipment” be received;
AND THAT Request for Proposal
172-R-07 for the Supply and Delivery of Soft Drinks and Related Equipment be
awarded to the highest ranked bidder, Coca Cola Bottling Company for a term of THREE (3) years with
an option to extend for an additional TWO (2) years based upon the mutual
agreement of both parties and with conditions that provide a financial return
as per Attachment “A”;
AND THAT the Manager of
AND THAT the Commission Lead, Community and Fire Services and Commissioner of Corporate Services be authorized to exercise the option to extend the contract for an additional TWO (2) years upon expiry of the third year provided that both organizations are satisfied with past performance;
AND THAT the $35,000.00 annual beverage exclusivity fund and the one time $50,000.00 signing bonus be credited to the Partnership Revenue Account 795 797 9394 as outlined in Attachment “A”. The $50,000.00 signing bonus will then be transferred to account 087 2800 200 Life Cycle & Capital Reserve Fund;
EXECUTIVE SUMMARY:
Not Required
PURPOSE:
The purpose of this report is to recommend the award of the contract for the Supply and Delivery of Soft Drinks and Related Equipment.
BACKGROUND:
The current contract for
the Supply and Delivery of Soft Drinks and Related Equipment expired on
The Request for Proposal (RFP) was issued on November 28, 2007 in
accordance with the
PROPOSAL EVALUATION:
The RFP was evaluated
by an evaluation team consisting of staff from Recreation Services, Marketing
and Community Partnerships and
The proposals were
evaluated based on pre-established evaluation criteria as listed in the
RFP: 5% Relevant experience of the
Proponent in the marketplace for contracts of similar size and scope; 5% Information obtained through references
provided with the submission; 15% Price
of beverages; 30% Community support and
sponsorship; 20% Commission payable to
the Town on vending sales; 20% Signing
bonus and exclusivity rights on sales and 5% Responsiveness to the proposal,
completeness and comprehensiveness of submission. The overall scores are listed in the
following table:
|
Bidder |
Scoring |
Rank |
|
The Coca Cola Bottling Company |
92.14 |
1 |
|
The
Pepsi Bottling Group |
83.28 |
2 |
OPTIONS/ DISCUSSION:
None
FINANCIAL CONSIDERATIONS:
The proposed
agreement represents a better arrangement for the Town of
The proposal also includes a 30% commission on vending sales which equates to an estimated $57,600.00 per annum, an increase of $11,680.00 per annum over the current contract. Further, a rebate of $1.00 on every case sold of 600 ml soft drinks, 591ml Dasani water and 591ml PowerAde Flat cap, will provide the Town with an estimated $2,000.00 per annum. In addition, Coca Cola Bottling Company has offered a product allowance and Community Initiatives fund ($2,500.00 each per annum), which will be allocated to the respective recreation facilities operating accounts.
The Coca Cola
Bottling Group will be providing product allowance as well as tickets to
events. Distribution of these items will
be based on the greatest benefit to the community and the Town of
ENVIRONMENTAL CONSIDERATIONS:
The Coca Cola Bottling Group recognizes their responsibilities to the environment and as such offer a variety of options including energy efficient coolers (Econo-cool) for all facilities, which offer energy savings of 52% over traditional coolers. The Coca Cola Bottling Company promotes youth fitness and have also launched a global partnership with the World Wildlife Fund (WWF) to conserve and protect freshwater resources.
A wide variety of healthy products will also be offered including water, fruit juices and low calorie/calorie free sport drinks. Furthermore, products such as Fruitopia will be offered with 25% less sugar plus vitamin C being added commencing 2008.
ACCESSIBILITY CONSIDERATIONS:
ENGAGE 21ST CONSIDERATIONS:
BUSINESS UNITS CONSULTED AND AFFECTED:
The Finance and Legal Departments have reviewed this report and their comments have been incorporated.
RECOMMENDED BY:
_________________________________________
Barbara Roth, Director, Recreation Services
_________________________________________
Allan
Seabrooke, Commission Lead
_________________________________________
Andy
Taylor, Commissioner, Corporate Services
ATTACHMENTS: Attachment “A” – Financial Details
Attachment “A” – Financial Details
· The total value of the previous 3 year agreement was $363,760.00. Table 1 below outlines that the recommended agreement is valued at $408,800.00, an increase of $45,040.00 over the previous agreement.
TABLE
1: FINANCIAL DETAILS
|
|
Pepsi Cola |
Coca Cola |
|
Revenue Account 795 797
9394: Cash Contribution |
3 Year Total |
|
|
One
Time Signing Bonus within 30 days of signing agreement |
- |
$ 50,000.00 |
|
Beverage
Exclusivity Allowance |
$
90,000.00 |
$
105,000.00 |
|
Total Contribution to Capital
Accounts |
$
90,000.00 |
$ 155,000.00 |
|
|
|
|
|
General Sponsorship
Account 795 797 9254: Cash
Contribution |
|
|
|
Sponsorship
for various activities within the Town of |
$
75,000.00 |
$ 60,000.00 |
|
|
|
|
|
Operating Budget
Contributions – Recreation Facilities |
|
|
|
-Commission
on Vending Sales based on an estimated 4,000 cases per year. |
$
144,000.00 |
$172,800.00 |
|
-$1.00
return on every case sold through vending and concessions on 600 ml soft
drinks, 591 ml Dasani water and 591 ml PowerAde Flat cap based on 2000 cases. |
- |
$ 6,000.00 |
|
Total Contribution to Operating Budget |
$
144,000.00 |
$178,800.00 |
|
|
|
|
|
Product in Kind |
|
|
|
Product
Allowance |
$
30,000.00 |
$ 7,500.00 |
|
Community
Initiatives Fund |
- |
$ 7,500.00 |
|
Total Non Cash Contribution to
Operating Budget |
$ 30,000.00 |
$15,000.00 |
|
|
|
|
|
|
|
|
|
Total Value of the Agreement |
$ 339,000.00 |
$408,800.00 |
· Staff is recommending that the one time cash contribution of $50,000.00 and the annual cash contribution of $35,000.00 be placed in the Partnership Revenue Account. The $50,000.00 signing bonus will then be transferred to account 087 2800 200 Life Cycle & Capital Reserve Fund. Each time resources are allocated to an initiative, Coca Cola Bottling Company will receive a note of appreciation and where appropriate Coca Cola Bottling Company will be acknowledged as a sponsor.
· Staff is recommending that the operating budget contributions continue to be allocated to the appropriate operating budgets and that the product in kind continue to be utilized through Community Services on an as needed basis.