Direct2Government, the new website that offers food manufacturers a direct sales channel via the Internet to Government agencies such as schools, prisons, and hospitals, reported today that after just three months in operation over 400 institutions and 75 large food manufacturers are taking advantage of the site’s efficiencies and economies.

David Fox, President of Direct2Government, said, “We opened in late May and began shipping in June. Without any pre-marketing or publicity, our sales doubled in July, and we believe August will triple July. It is obvious we are meeting a need.”

As an example of Federal support for Internet transactions, Mr. Fox said he met with Gerald J. Collins, Federal Bureau of Prisons National Administrator of food and farm services, and regional administrators of the Bureau, at the Bureau’s annual meeting in Kansas City in June, and subsequently with prison administrators in San Diego, California, in July.

He said both meetings were extremely productive, and that Mr. Collins has alerted all Bureau of Prisons food-contracting officials of the benefits and services of

Mr. Fox commented that news of Direct2Government is spreading rapidly through the community of prison administrators. Since the site went online in early June over 150 prisons (including local and state prisons and detention centers) have signed on. Many of these have already placed orders on the site.

The Bureau of Prisons annual budget for food purchases is over $2 billion, and, Mr. Fox says, “We have the potential of seeing much of that run through our system.”

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“Not only are the Federal agencies supporting us,” Mr. Fox continued, “so are major food manufacturers.” He cited recent agreements signed with Agrilink Foods and Chiquita Processed Foods under which all products intended for Internet sale to government agencies will be routed through Direct2Government.

Agrilink Foods is a huge nationwide cooperative of 800 member-growers with annual sales of $1.2 billion. Chiquita Brands International is a global leader in premium branded foods, with sales of over $2 1/2 billion.

Mr. Fox said a number of factors are contributing to the site’s acceptance:

  1. Direct2Government is backed by LA Foods, a successful national food distributor that for 10 years has specialized in cultivating the government-sponsored institutional food market. “Direct2Government is building on that base,” Mr. Fox pointed out.
  2. Transactions completed via Direct2Government save buyers money and suppliers distribution and marketing costs.
  3. Direct2Government enables food manufacturers to target directly the huge institutional market-over $13 billion a year-that is difficult to isolate and expensive to reach by conventional marketing.
  4. The Federal Government is urging all its agencies to take advantage of Internet benefits.

Mr. Fox said Direct2Government continues to add institutional food buyers and food manufacturers to its “members only” rolls.

Direct2Government’s client base also includes privately run prisons, state and local agencies, and school districts from coast to coast.