FY17 Program Department Report & Review for Board Meeting June 13, 2017

Board of Directors Meeting June 13, 2017 Program Department Report 1

FY17 Program Dept. Plan Overview Overall Goal: Headcount Growth of 16,500 to 104,500 children served Develop infrastructure to support growth in the areas of: Staff including Boots on the Ground Program Support Strategy Pricing Structure Enhanced Volunteer Support Food Logistics All others, 27,596 , 29% Walmart/Sa m's Club, Publix, 2,316 , 3% Chapter Structure Implementation Sysco, 25,370 , 27% 21,812 , 23% Meijer, 11,649 , 12% Optimum Foods, 3,855 , 4% 2

FY17 In Review: Children Served Budget Projected Variance Beginning Headcount Actual 88,000 88,039 39 National Managed Relations (1) NUDM Dale Jr. New Regional Directors (2) Grass Roots: New Programs Legacy Total Grassroots Less Estimated Attrition (3) Grassroots, net of attrition FY Ending Balance 4,000 2,200 1,422 1,721 2,200 1,422 (2,279) - - 2,180 2,209 29 - 1,921 5,552 13,400 7,473 (5,927) (6,700) (8,565) (1,865) 6,700 104,502 (1,092) 94,499 (7,792) (10,003) (1) Includes appx. 4,000 children from Ohio Dept. Of Health, an increase of appx. 3,000 (2) Includes all children in programs assinged to RMD, even if outside target market. i.e. RMD for Jacksonville also has responsibility for program oversight for Alabama and select areas in FL (3) Actual attrition for FY17 will be determined once 6/30/17 childcount numbers are available 3

FY17 Year in Review: Program Team Footprint 4

FY17 In Review: Children Served Primary Reasons Growth Objectives Were Not Achieved Hiring program team staff took longer than anticipated New Regional Managing Directors (RMDs) in place for 9 months or less New Program Managers (PMs) in place for 8 months or less See slide 7 for comparison of MD vs. PM responsibilities New pricing roll-out was a significant distraction in moving forward Higher attrition than anticipated in the FY17 Plan Pricing structure changes Expiring commitments for previous growth spurred by People Magazine Historical lack of proactive outreach to support program volunteers due to PM coverage limitations (3.1 FTEs for 88,000 children) Some programs are serving fewer children as the need has decreased at individual schools improving economy? Let s look at these factors in further detail 5

FY17 in Review: Staff Additions = Boots on the Ground 2017 Approved Plan Establish boots on the ground to grow regional base in the following areas: Southwest Florida (PT to FT) 7/1/16 target, implemented 11/1, once Jacksonville RMD was hired and trained Jacksonville Florida 8/1/16 target, hired 9/21/16 Chicago 8/1/16 target, hired 9/11/16 Louisville 1/1/17 target, implemented 1/1/17 Selection criteria included strong local advisory board in place (except Chicago where overseeing NUDM funding was a key requirement) Hire in advance of positions being able to support their own costs. Expected year 2 to be self-funding. Expected cost was $66K ($56K salary + $5K travel + $5K misc.) 2017 Results/Findings Regional Managing Directors in FL markets spend more time than anticipated on local advisory board development and maintaining existing programs vs. fundraising and program growth Actual RMD cost higher than expected. FY 2018 budget $84K average or $18K higher than FY 2017 expected Positions require financial support for marketing and PR, geographic-specific website, etc. in addition to salary/benefits/travel Each market has different attributes that impacted growth Headcount?Growth? FY? 2017 Region Begin 2,752 ? ? ?? ? ? ? ? 9,772 ? ? ?? ? ? ? ? 4,987 ? ? ?? ? ? ? ? 7,457 ? ? ?? ? ? ? ? End* Change ? ? ?? ? ? ? ? ?? ? ? ? ?? ? ? ? ? ?? ? ? ? ?? ? ? ? ? ?? ? -? ? ? ? ?? ? ? ? ?? %? change Plan Southwest? Florida Jacksonville? Florida Chicago Louisville ? ? ? ? ?? ? ? ? ? ?? ? ? ? ? ? ? ?? ? ? ? ? ?? ? ? ? ? ?? ? ? ? ? ?? ? ? ? ? ? ? ?? ? ? ? ? ?? ? ? 3,295 10,700 5,564 7,303 543 928 577 154 20% 9% 12% -2% ? ? ?? ? ? ? ? ?? ?? ? ? ?? ? ? ? ?? ? ? ?? ? ? ? ? ?? ?? ? ? ?? ? ? ? ? ?? ?? 4,615 11,731 7,236 9,250 *? Projected 6

Roles and Responsibilities of Managing Directors vs. Program Managers Regional? Managing? Director Implement? Blessings? in? a? Backpack? strategic? plan? in? assigned? geographic? territory? with? oversight? for? all? local? fundraising,? program? operations? and? execution.? ? "Boots? on? the? Ground"/face? of? BIB? in? the? local? community. Program? Manager Act? as? the? liaison? between? resources? of? the? National? office? and? local? volunteer? program? coordinators.? (PCs). Summary FY18? Fundraising? Goal $237,000 $0 Work? with? the? local? advisory? board? to? develop? needed? resources. Build? partnerships,? establishing? relationships? with? the? funders,? political? and? community? *? ? Corporate? asks *? ? Grant? writing Fundraising Complete? the? strategic? business? planning? process? for? program? expansion. Seek? and? build? board? involvement? with? strategic? direction. Strategic Support? start-up? of? new? programs: Menus Food? logistics How? to? run? a? program Working? with? volunteers Ongoing? support? of? programs Food logistics solutions, as needed Provide? donor? and? financial? reports Field? ongoing? questions *? ? Chapter? board? liason? &? advisor Support? start-up? of? new? programs: Menus Food? logistics How? to? run? a? program Working? with? volunteers Ongoing? support? of? programs Food logistics solutions, as needed Provide? donor? and? financial? reports Field? ongoing? questions Operational? *? ? ? Represent? the? national? office? at? local? events? when? feasible.? i.e.? local? program? fundraisers,? check? presentations,? etc. Act? as? a? spokesperson? at? external? programs? and? events? for? constituents? and? the? general? public,? when? feasbile *? ? Volunteer? coordination *? ? Local? board? &? school? event? support *? ? Volunteer? coordination Coverage Serve? 50-200? schools,? <10k? children Specified? region Serve? 200-300? schools,? 20-30K? children Multi-state? geographical? footprint 7

FY17 Year in Review: Regional Managing Director ModelCurrent State Key Responsibilities: Interface with local Advisory Board limited structure or succession planning; no established give/gets; work of committees loosely defined (if at all) Program Operations oversee an average of 6,400 children, 17-61 programs, with an average of 140 children per program. (RMDs with larger counts also have some Program Management responsibilities.) Fundraising in the local community to cover operating expenses and feed additional children Average cost of Regional Managing Director direct expenses = $82,000 Includes Salary/benefits, Marketing, Phone, Supplies, Travel Breakeven @ $10/child = 8,200 children Unrestricted $s expected to be raised to help cover costs. higher than current assignment Realities: Targeted Salary for this position is extremely low given the skillset required 8,200 children is higher than current assignments-->MDs are at capacity On average, 77 % of children covered by MDs are legacy, not $10/child (varies greatly by market 8

FY17 in Review: Program SupportPricing Strategy 2017 Approved Plan Major initiative: New Pricing Rollout 2017 Findings/Results $10 per child nonfood program support to take effect in the 17-18 school year was announced in October 2017 Backlash from existing legacy programs was extremely negative Following Board of Directors input, a Pricing Task force convened in December 2017 A revised price structure for legacy programs was approved and implemented 2/1/17 Impact is effectively $2/child vs. $10/child; however, risk of losing children served was lessened 9

FY17 in Review: Program SupportVolunteer Resources 2017 Approved Plan Major initiatives: Enhanced Volunteer Support 2017 Findings/Results PC newsletter was launched in May to coincide with National Volunteer Week Significant enhancements to the PC Toolkit for volunteer Program Coordinators (PCs) Comprehensive updated Operations Manual to be released by June 30, 2017 Possible National PC Conference was delayed to 2018 to focus on reaching PCs through newsletter and PC Toolkit and to ensure adequate sponsorship support 10

FY17 in Review: Food Logistics 2017 Approved Plan Create a National agreement with incumbent Sysco or other appropriate food vendor Pilot a prepackaged solution with Champion Foodservice Create an advisory committee to weigh in on possible solutions 2017 Findings/Results A National agreement with Sysco would have added 10% to food cost Prepackaged solution with Champion was piloted in Florida and Louisville through Sysco Very successful in Florida Mixed results in Louisville Sysco s lack of willingness to stock both prepackaged solution and line item menu was a significant obstacle to further roll-out Attempts to address food logistics with probono consultants were not successful ERA hired to support food logistics reengineering in April. Detail analyses completed in May. Initial recommendations expected by the end of June 11

FY17 In Review: Chapter Structure Implementation 2017 Approved Plan Develop a model to replicate in new markets Standardize local advisory boards 2017 Findings/Results Initiative was assumed by Director, Strategy and New Initiatives in connection with new market roll-outs Templates developed included: Operating Practices and Principles Advisory Board Member Job Description Advisory Board Member application Regional Managing Directors are using templates as guidelines in working with established local advisory boards in moving to best practices, modifying as appropriate for local market needs. Some cultural resistance to overcome (i.e. no prior dues or give or gets ) 12

FY18 Program Priorities Overall: Breaking the Code to Sustainable Growth to serve 106,400 by 6/30/18 Maximize assets already in place: Regional Managing Directors Fundraising plans are being developed by each RMD for their respective markets RMDs to identify key memberships that will enhance their networking for purposes of fundraising Further collaboration with the National Fund Development Department to enhance local fundraising skills and opportunities Identify opportunities for collaboration and partnerships to significantly increase growth: Develop a comprehensive list of prospective collaborators, preferably national in scope (I.e. Share Our Strength/No Kid Hungry, Feeding America, United Ways, Boys & Girls Clubs, large religious groups, police departments.) Conduct research to identify feasibility/pros and cons of collaboration Create partnerships aimed at significantly increasing numbers of children served as well as funding opportunities. 13

FY18 Budget Student Headcount Growth Children? Served 7/1/17? Projected? Balance Existing? Legacy? Programs New? Grassroots? Growth Program? Staff? Driven Less? Attrition 6/30/18? Projected? Budget 94,499 6,693 5,408 5,408 (5,600) 106,408 ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? Notes: Increase of appx. 12,000 students, net of attrition, is nearly double FY17 growth Looking for increased productivity of assets put in place Need to identify partnerships that will DRAMATICALLY increase the number of children served per program can t rely on grassroots growth with 50 children/school The 5 year strategic plan called for FY17 ending headcount to be 140,000 225,000 for FY17 and FY18, respectively 14

FY18 Program Priorities: New Regional Managing Directors in New Geographic Target Markets Los Angeles and Washington, D.C. Revenue Goals before hiring a local RMD Raise $135K (LA) and $105K (DC) through Advisory Boards, Sponsorship, and Personal Donations Atlanta Revenue Goals before hiring a local RMD Raise $135K through Advisory Board, Sponsorship, and Personal Donations Target hire dates, depending on fundraising goals, are late Spring/early Summer of 2018 In the year following the hire of a new RMD in each new market, the goal is to increase child count by 1,500. Once a new market has a RMD in place, then National BIB would start the new market process over, by adding another city. 15

FY18 Program Priorities Overall: Breaking the Code to Sustainable Growth Establish Food Logistics Solutions as a Competitive Advantage over other weekend food programs 50% of food purchases are at retail prices 60% of food purchases require volunteers to pick up food (vs. delivery to packing site) Food purchases from 220 sources monthly do not leverage total food spend A cost-effective and efficient food logistics solutions: is key to minimizing attrition for those who believe they can run their programs more cost- effectively on their own is necessary to accelerate future growth in children served 16

FY18 Budget Implications FY18 BUDGET AS PREPARED DOES NOT INCLUDE FUNDING FOR CONSULTANTS TO CONTINUE FOOD LOGISTICS REENGINEERING WORK ($7,500/month = $90k annual + travel) Will inhibit future growth unless another solution for food logistics is identified Will continue to require staff time in areas where there is no value-added Agreement negotiated in April 2017 does provide an out if project funding is not approved Excerpt from ERA Report dated May, 22, 2017 Based on our initial analysis, we believe that the potential for process improvement, vendor consolidation, and both hard and soft cost reduction is significant. Recognizing that achieving maximum results will require change throughout the BIB organization, we recommend a series of conference calls / webinars with BIB field leaders to present the initial data and the project plan, followed by a detailed market assessment to determine potential issues / obstacles by market, as detailed in the project timeline below: Task Completion Responsibl e April July 2017 Phase 1 Data Collection, Market Analysis, Prioritization Collect data, summarize findings Identify process improvement opportunities by market ERA, BIB ERA May 2017 June 2017 Review opportunities, evaluate requirements Qualify existing markets (easy / moderate / Difficult) Incumbent supplier analysis / evaluation ERA, BIB BIB ERA, BIB July 2017 July 2017 July 2017 17

FY18 Budget Implications A COST EFFECTIVE AND EFFICIENT FOOD ACQUISTION AND DISTRIBUTION SOLUTION HAS GREAT POTENTIAL TO BE OUR COMPETITIVE ADVANTAGE IN ATTRACTING AND RETAINING OTHERS TO PARTICIPATE IN BLESSINGS IN A BACKPACK PROGRAMS What is the value-added BIB provides? For those who have: another way to accept tax-deductible donations (i.e. church, community foundation) are buying groceries from local retailers have volunteers available and a packing methodology There may be no compelling reason to be a part of BIB! RECOMMENDATION: Continue ERA project at least through the end of July 2017 complete the strategic assessment of where we re at. 18