Project Case Studies

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Vendor-Generated Solution Maximizes Cost Model

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Schedule: 0% Transition Delays
Cost Impact: $3.5M guaranteed revenue generation per year

 

Type: Services

Vendor:  Follett Higher Education

Location: Tempe, AZ

 

Contract: $35,000,000

 

Start Date:  May 2011

Duration: 10 Years

Campus Book Stores

The University turned to our group to outsource campus book store services. Although satisfied with their in-house operations, the University felt pressure to seek vendor expertise for long-term solutions due to rapidly evolving market conditions in the book industry.

Our group facilitated an RFI process to define market capabilities and identify current performance levels of in-house book store operations. A Best Value RFP was released, including an option for vendor-created cost model proposals. This innovative RFP approach resulted in an awarded contract which guaranteed the University minimum commissions of $3.5M per year, $2M in capital improvements, plus additional percent commissions. This was a huge financial success, especially when compared to the cost-based in-house model being utilized prior to outsourcing.

As the awarded vendor participated in the Best Value pre-planning process to seamlessly transition into full operation and management responsibilities before the start of the ensuing semester, all with 0% schedule impacts.

REFERENCE:  Sam Wheeler,  Executive Director of Business Services | sam.wheeler@asu.edu

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Best Value Vendor Executes Risk Management Plan

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Type: Services
Vendor: Aramark

Location: Tempe, Arizona

 

Contract: $800 Million over 16 years

 

Start Date: July 2007
End Date: July 2023

University Dining Services

Dining ServicesIn 2006, Arizona State University utilized the Best Value process on an $800 Million procurement for campus wide food service. This not only was the largest project procured using the Best Value process, but was one of the largest food service contracts in University history.
The success of the contract has far exceeded expectations.

"The Best Value method literally took us through the process [of procuring the dining service contract] much more rapidly than we ever have done in the past. We’re talking weeks to do things that took months, and a couple months to do things that sometimes would've taken up to a year... I’m very grateful for the work that we're doing with Dr. Kashiwagi and the PBSRG." - Ray Jensen, Associate Vice President of Business Services [Retired]

The true value of the PBSRG's vendor selection process and risk management planning was put on display in 2007, when a fire broke out ASU's Memorial Union building, which houses the majority of the universities dining venues and student lounge and entertainment areas.

Criteria Year 1
(From Incumbent)
Year 2
(From Year 1)
Year 3
(From Year 2)
Year 4
(From Year 3)
Year 5
(From Year 4)
Sales 14% Increase 11% Increase 24% Increase 13.5% Increase 8.3% Increase
Commission 23% Increase 6% Increase 20% Increase 22% Increase 10.8% Increase
ASU Management Requirement Reduced 79% arrow-line
Student Satisfaction 37% Increase 1% Decrease 9% Increase 3% Increase 0.2% Increase

 


REFERENCE: John Riley, Associate VP of Business Services | John.Riley@asu.edu | 480.727.0894

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