- What if our district isn't comfortable with
advertising in schools?
- By signing a district-wide deal, aren't we
just "pushing" soft drinks to our students?
- Why shouldn't our district do this
internally?
- How are nutritional concerns addressed in
your program?
- Why should our district sign with DD
Marketing?
- Who sets the pricing?
- Why should we commit to a ten year deal?
- Why should principals support this when
they already have a contract for their individual schools?
- How will this affect the profitability of
our district's food service program?
- What if we don't have time for something
like this?
- Does this program comply with the Federal
School Meal Program?
- Do revenues from this program jeopardize
any funding we already receive?
- Are these revenue projections truly
realistic? How do I know you can do the same in our state?
- What about preexisting deals?
- When does the school district receive
payment and what comprises the revenues from this program?
- You've mentioned that you negotiate
"guaranteed commissions". Why is that important?
What if our district isn't comfortable with
advertising in schools? (top)
Our firm understands that advertising is a delicate issue for
some districts. Advertising does not need to be a component of this
soft drink vending opportunity. Your district is in complete control
and may choose whether or not to allow advertising as a part of the
soft drink Request for Proposal (RFP).
By signing a district-wide deal, aren't we
just "pushing" soft drinks to our students? (top)
Absolutely Not! If your district is like most others across the
country, there are already soft drink vending machines in some, if
not all, of your schools. Our program is passive; it is not
designed, nor intended, to "push" or promote the sale of
soft drink beverages to your students.
Why shouldn't our district do this
internally? (top)
Unfortunately, we've come across many districts that have tried
to negotiate their own contracts. Most districts have been unable to
realize significant revenues from their contracts and none have been
able to come close to matching the revenues that our firm has
created. Purchasing departments work with literally thousands of
products and negotiate hundreds of deals-they cannot be expected to
have an in-depth knowledge of soft drink vending, nor be able to
devote the time required for this one area. Also, school districts
only have one chance to get it right. At DD Marketing, exclusive
soft drink vending is the focus of our company.
Jefferson County School District (Denver, CO) negotiated an
exclusive soft drink contract without our assistance and generated
$1,000,000 a year for a seven year total of $7,000,000. While at
first this may seem favorable, consider the following: as the
largest district in the state with over 84,000 students, the per
pupil funding generated by their contract equates to only $11.31.
Compared with DD Marketing's average negotiated figure of $33.69 per
student, Jefferson County SD left over $14 million dollars on the
negotiating table. In fact, the media has questioned the district's
inability to match the results we have achieved. Obviously, the
experience, expertise and ability provided by DD Marketing, Inc.
maximizes the district's financial return in the attainment of a
soft drink vending contract.
How are nutritional concerns addressed in
your program? (top)
As part of our program, we require vendors to install
state-of-the-art vending machines. When we create the RFP with your
District Team, we work with your principals and staff to determine
which products will be dispensed from these machines (and when). For
example, a machine in an elementary school can be programmed to
dispense only 100% fruit juices, bottled water and isotonic sports
drinks during school hours; in the evening, when adults and outside
foot traffic are using your buildings, the machines can dispense
soft drinks as well. Again, your district retains complete control
of all facets of the program, including which products are sold,
where they are sold, and when they are sold.
Why should our district sign with DD
Marketing? (top)
DD Marketing, Inc. is the premier company in the country when it
comes to exclusive soft drink vending contracts. Our track record
shows that we are the leader in this industry and reinforces that
the contract we negotiate on behalf of your district will far
surpass any contract that our competitors could produce, as well as
any contract that your district may negotiate on its own behalf.
Ultimately, your School Board retains a final right of refusal for
any soft drink vending contract we present. It's a no risk situation
for your district!
Who sets the pricing? (top)
All pricing is agreed to by the district (we provide
recommendations) and the winning soft drink vendor. Typically, 12
oz. cans sell for $0.50; 20 oz. bottles, juices, bottled water and
sports drinks sell for $1.00. For any price increases, the vendor
must document an actual increase in cost of goods and all price
increases must be mutually agreed to by the vendor and the school
district.
Why should we commit to a ten year deal? (top)
By offering a ten year exclusive window, the district is assured
of receiving the maximum financial return possible. Vendors only
agree to these types of contracts if they are provided ample time to
recover the investment they make in the district (i.e. exclusive
rights fees and state-of-the-art machines). If a ten year program in
unworkable for the district, it may be possible to arrange a
slightly shorter term.
Why should principals support this when
they already have a contract for their individual schools? (top)
While the district ultimately determines how to distribute the
revenues, the district can build support and consensus among
principals by guaranteeing them significantly more revenue than they
have realized with their school's own individual contract. In our
experience, when the district office distributed a portion of the
revenues to individual schools, each school received an increase of
at least 100% while some schools received up to a 500% increase;
furthermore, the district was still able to retain about 50% of the
total revenue for the general budget. In the end, it's a
"win-win" situation throughout the entire district since
these additional revenues will ultimately filter down to the schools
in the form of capital and technology improvements or increases in
wages and staffing.
How will this affect the profitability of
our district's food service program? (top)
Our program is designed to ensure that your district's food
service program is not adversely affected by signing an exclusive
soft drink vending contract. As part of the process, we negotiate a
price structure that is equal to or less than what your food service
program currently pays; furthermore, these prices are locked in for
the full term of the contract, protecting your food service program
from arbitrary price increases by the winning vendor. Through DD
Marketing, your food service program will receive better overall
service from the winning soft drink vendor-we can also help your
food service program secure additional equipment from the winning
vendor, either at below-market prices or potentially free of charge.
We are pleased to offer these services gratis-we do not earn any
type of commission from this portion of our services.
What if we don't have time for something
like this? (top)
DD Marketing coordinates a turnkey program for your district-we
put our resources to work for you. Since we are willing to accept
the lead every step of the way (we still present everything to the
district for approval) you're free to choose your own level of
involvement.
Does this program comply with the Federal
School Meal Program? (top)
Yes. We require the winning vendor to install state-of-the-art
machines equipped with computer chips. These machines automatically
stop dispensing soft drinks 30 minutes before meals, during meals,
and for 30 minutes immediately following meals, guaranteeing
compliance with the Federal School Meal Program.
Do revenues from this program jeopardize
any funding we already receive? (top)
No. Our contract is written to ensure that any new revenues our
program creates for your district are actual incremental dollars.
Any governmental funding your district already receives will not be
jeopardized as a result of signing an exclusive soft drink vending
contract through DD Marketing, Inc.
Are these revenue projections truly
realistic? How do I know you can do the same in our state? (top)
If exclusive vending rights are marketed correctly, these kinds
of revenues are realized. In fact, we are so confident in our
ability to negotiate a similar deal for your district that we work
on a back-ended commission structure. Our firm receives nothing
unless the contract is approved by your School Board. It's truly a
no-risk situation for the district.
What about preexisting deals? (top)
Many schools have existing soft drink vending agreements. In our
experiences with districts, we have not found individual school
deals to be any kind of obstacle. When DD Marketing warrants a
Request for Proposal (RFP) on behalf of the district, and the
current vendor responds, the vendor waives its right to any
preexisting agreement.
When does the school district receive
payment and what comprises the revenues from this program? (top)
Payments to the district from an exclusive soft drink vending
deal are made in two forms. The first is an annual rights fee
payment made to the district, typically at the beginning of the
district's fiscal year. This rights fee payment represents 30-50% of
the total annual payment to the district. Second, the district will
receive the remainder of the annual revenues through monthly
guaranteed commission payments from the vendor. These payments are
typically received in the first 15 days following each month.
You've mentioned that you negotiate
"guaranteed commissions". Why is that important? (top)
Our firm negotiates guaranteed commissions for your district so
you know exactly how much your district will receive each year from
the exclusive soft drink vending contract. By making guaranteed
payments, the vendor assumes all the risk-if sales don't meet the
vendor's projections, the district isn't penalized. Our firm also
negotiates a sales incentive clause for the district; if sales
exceed a certain level, the district receives a bonus payment at the
end of the year. This approach is yet another innovation that sets
DD Marketing apart from our competition. For districts with
immediate cash needs, long-term guaranteed commissions can be
extremely advantageous: since commission payments are guaranteed and
are backed by leading corporations, the district has the added
flexibility of selling any or all future commission payments in
order to fund short-term projects or needs.
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Location and Contact Information
DD Marketing, Inc.
Corporate Office
504 North Grand Avenue
Pueblo, Colorado 81003
Phone: (719) 546-3333
FAX: (719) 546-3334
E-mail Questions/Comments
rlane@ddmktg.com
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