Building on the success of its organic buying policy, The City of Copenhagen is working on ways to enable small-scale farmers to supply public sector kitchens using market dialogues and the development of appropriate criteria which farmers can address when they tender for contracts.
Name of organisation | City of Copenhagen |
|---|---|
Year established | The Danish Government has undertaken several initiatives to support organic conversion over recent decades. In 2001, the City of Copenhagen began to transition public sector food provision to 90% organic content. In 2019 the City committed to a visionary strategy for public food and meals in combination with a Climate Plan and Action Plan for The UN Sustainable Development Goals. |
Website | City of Copenhagen |
Location | Denmark – Copenhagen |
Type of organisation | Municipality (public procurement) |
Key words | value chain collaboration; capacity building; market dialogue; Green Public Procurement (GPP); sustainable public food procurement |
Thematic focus | Public procurement |
The City of Copenhagen – towards Carbon Neutral in 2025
Copenhagen is famous for its achievement of 90% organic food in public kitchens. This has been possible through a dual effort of training kitchen staff and simultaneously restructuring the procurement methods to ensure supply of quality organic ingredients1. Moreover, this was achieved without increasing the budgets for kitchens. Organic procurement is also thought to have contributed to a five-fold increase in organic sales in the private food service sector over 10 years2 – in fact organic food makes up 24% of total food sales in the city3. All this was achieved through a combination of national government and city policies, public financing for conversion and education, training and capacity building for kitchen staff, intensive collaboration between organic farmers, food companies and wholesalers.
In 2019 The City of Copenhagen committed to a visionary strategy for public food and meals in combination with a Climate Plan and Action Plan for The UN Sustainable Development Goals. The city’s latest tender builds on this development and was published in October 2020 and granted in February 2021. The tender contains several new specific demands and criteria for sustainability, with a focus on the requirements being measurable and thus possible to follow up on during the contract period.
Over recent years, procurement officials in the city have been working on how to open the public sector market to small scale farmers. One product they have been focusing on is potatoes. This document tells the story of the development of a potato tendering process which is accessible to small-scale farmers. It starts with a market dialogue which tries to encourage the small-scale farmers interest in a public contract. Then a kitchen analysis is undertaken to look at how many different suppliers can be handled, and what criteria are important to the chefs. Following decisions on what contracts to move along with, the contract values are calculated, and the procurement procedures are continued, where the written materials are kept as short and clear as possible.
What do the City’s procurement officers do?
The procurement officers are responsible for preparing tender documents which incorporate the required policy objectives, while ensuring that the needs of buyers are met and that suppliers can fulfill the requirements.
Two key components are first, understanding the need (demand) of the customers and second, finding out what the market can deliver (supply).
The success of Copenhagen’s approach to public food procurement is built on a collaborative approach, between public officials, professional catering and food service staff, wholesalers, and growers.
Mediating demand and supply in the public sector through ‘market dialogue.’
The approach in Copenhagen is to conduct ‘market dialogues.’ Dialogues can happen individually, as in some cases it can be difficult to talk about the market if competing companies are gathered for a large supplier meeting. This can be done by contacting the suppliers who are already known, and then at the same time publishing on a website or similar that you are open to individual market dialogue, how to register and what the deadline is for registration. In this way, there is a level playing field for all potential bidders. This must be done in a manner that respects principles of equal treatment, nondiscrimination and transparency.
When the internal demand is clarified and individual market dialogue is completed, the tender design is decided, and the contract value is calculated. It must be considered whether there are smaller suppliers that could advantageously bid for parts of the contract and whether it would make sense for the buyers (often the kitchen staff) who source the food to order and receive their food supplies from one or more suppliers, and in that way consider whether to divide the contract in smaller lots.
If the market analysis shows that, for example, there is a producer of fresh potatoes, and they would like to be able to deliver to the local nursing home, then public purchasers are obliged to look at procurement patterns and see if it is possible to divide the tender material into smaller lots so that the small supplier can make a direct offer for the contract. But of course, the kitchen’s ordering patterns and their everyday practice must also be considered.
In fact, the process of undertaking market dialogues requires several meetings and consultations with buyers (kitchen staff) and market players as is described in detail in the COACH toolkit for farm to fork procurement [a link will eventually need to go here].
The draft version of the tender is published on an electronic platform created for market dialogue, together with the link to the registration for the dialogue meeting. Questions may be published, which the contracting entity would like to have clarified from the tenderer. Everyone is welcome at the meeting, which will be recorded and published afterwards.
After the publication of the tender documents, a market monologue meeting is held. This meeting is recorded and subsequently published. The aim of the meeting is to examine the material and how the contracting entity wishes the tenderer to fill in the material. This review merges the comments on the material during the market dialogue meeting and the written questions received for the previously published draft tender dossier. In the review, it is important to provide an explanation of how a given question has been handled in the final tender documents so that the questioner can see whether the comment submitted has been considered and if not, it is important that the contracting entity provides a reason for the lack of response to the potential bidder’s proposal/question to the draft. In this way, tenderers will gain a greater understanding of the final tender documents and there is a greater chance that some good offers will be made.
Designing the Potato Tender: The Story So Far
In Denmark there are three large wholesalers who supply most of all foods for public catering. Whilst this meets the requirements for 90% organic content, the city authority would like to give small and medium sized enterprises the opportunity to bid. The motivations for this vary: for some politicians and citizens, “buying local” is important for political, environmental and social reasons. For the procurement department, the drive is primarily a desire to improve competition by opening the market for a range of potential suppliers, particularly the smaller-scale producers who have traditionally faced great difficulties in supplying food for the public sector.
From a procurement perspective, more equal competition – or the creation of a more ‘level playing field’ – should ensure good or better value for money, for example by buying direct from farmers. The key point is that any procurement process must focus on identifying the qualities of the products that are desired by the public sector (for example, ‘organic’, or nutritious). In addition, the city is also looking for the ‘added value’ of buying direct from farmers and is doing this by linking the provision of food to education. They have introduced innovative procurement criteria whereby whoever wins the contract must be willing to provide learning sessions for school children – either on the farm, or online. The idea is to give more children more insight into what it is like to be a farmer. This can also be linked to teaching materials, for example cooking classes, history, biology, maths. In Denmark, all children aged 13-14 take cookery classes in school time.
What are the main challenges?
Small-scale farmers are not always able to supply the correct quantity and quality of product for the public sector – this is the reason why it is important to consider whether contracts can be broken down into smaller lots. Also, the public sector may not offer particularly good payment terms (e.g. late payment). There is often a demand for products to be washed and not all small farmers have access to machines for this. Transport can also be a problem, which is one reason why farmers may prefer to sell to a wholesaler who will collect and deliver their produce.
Another issue is that small farmers are often not able to demonstrate their green credentials in a way which is the right format for public sector procurement. They often do not have time or capacity to even consider this, as they need to focus on the farming itself. On the other hand, larger producers and big food companies or wholesalers do have the capacity to invest in recognised certification, labelling etc.
Procurement officers may face barriers in their institution when making the case of innovative approaches. For example, if senior leadership does not see the added value of buying from small farmers, it can be difficult for a procurement officer to move forward. There are also pressures of time, budget and the fact that political goals might not align with operational realities.
Another challenge is that procurement officers may not have detailed knowledge of food and farming. It is very rare to find procurement officers with a specialism in a product category and they will often be buying a whole range of products, from furniture through to streetlights and computers. However, as the case of Copenhagen shows, a detailed knowledge of the products and possibilities is needed, so that the contract can be designed appropriately, and therefore the market dialogues have proved so important. As Betina Bergmann Madsen, chief procurement officer of Copenhagen explains “Procurement officers have the key to change things by how they establish contract criteria but maybe they don’t realise this.”
In order to overcome this challenge, it is essential to build effective and systematic knowledge exchange and to make sure that procurement officers have time to take part in this. In Denmark the creation of a national network for food procurement officers, has helped to spread knowledge fast. The networks serve both to share knowledge and to help inspire each other on how to do green public food procurement. Another example is the Best Re-Map project, which is building a European network to support knowledge exchange amongst the procurement community.