Food bank economics

I listened to a "feel good" news story this morning on CBC where the station was congratulating itself on raising funds for a local food bank. The bit that really caught my attention was that the food bank is better off with cash donations than food item donations; they have negotiated wholesale prices from food distributors.

Good for them, a local non-profit community service organzation is using their market power to lower their operating costs, and improve the volume of goods they can deliver to their clientele. It left me wondering though; here's my line of thought.

First, as I understand it, food banks mostly serve "working poor", people with jobs or who are on some form of fixed income, who are not earning enough to meet their basic needs. Second, there is usually some form of rationing, such as one food hamper per family per week. Assuming for a moment these two assumptions are true, I wonder whether the food banks can extend their discounted prices to their clients? Their clients are presumably paying for some of their own food, at retail pricing, only getting a partial subsidy from their periodic free hampers. By extending the preferential pricing to their clients they would be able to further their organization's goals, and may in fact, also add to their market power, increasing their ability to negotiate preferential pricing for food.