DoD's $33M Flour Purchase: General Mills Awarded Firm Fixed Price Contract for Baking Products

Contract Overview

Contract Amount: $33,165,177 ($33.2M)

Contractor: General Mills Inc

Awarding Agency: Department of Defense

Start Date: 2011-04-01

End Date: 2011-06-30

Contract Duration: 90 days

Daily Burn Rate: $368.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: RESALE - FLOUR AND OTHER MISCELLANEOUS BAKING PRODUCTS

Place of Performance

Location: MINNEAPOLIS, HENNEPIN County, MINNESOTA, 55426

State: Minnesota Government Spending

Plain-Language Summary

Department of Defense obligated $33.2 million to GENERAL MILLS INC for work described as: RESALE - FLOUR AND OTHER MISCELLANEOUS BAKING PRODUCTS Key points: 1. Significant spending on essential baking ingredients. 2. Sole source award to General Mills Inc. 3. Potential for higher costs due to lack of competition. 4. Focus on Defense Commissary Agency operations.

Value Assessment

Rating: fair

The contract value of $33.2 million for a 3-month period is substantial. Without a benchmark for flour and baking product procurement, it's difficult to definitively assess pricing, but the lack of competition raises concerns about potential overpayment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded on a sole-source basis, indicating no competition. This limits price discovery and may result in the government paying a premium compared to a competitive bidding process.

Taxpayer Impact: Taxpayers may bear a higher cost due to the absence of competitive pressure on pricing for these essential baking products.

Public Impact

Ensures availability of baking ingredients for military personnel and families. Supports a major food manufacturer, General Mills Inc. Potential impact on market prices if this is a common procurement method.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price negotiation.
Short contract duration may indicate a need for ongoing, potentially uncompeted, procurements.
Lack of detailed justification for sole-source award.

Positive Signals

Ensures supply of critical food items.
Utilizes established supplier (General Mills Inc.).

Sector Analysis

This procurement falls under the food manufacturing and wholesale sector. Spending benchmarks for flour and baking products are highly variable based on market conditions and specific product types. The $33M for a 90-day period suggests a large-scale operation.

Small Business Impact

This contract was awarded to a large corporation, General Mills Inc., and does not appear to include provisions or set-asides for small businesses. The sole-source nature further precludes small business participation.

Oversight & Accountability

The sole-source justification is not detailed, raising questions about the oversight process. Further review would be needed to confirm if adequate market research was conducted prior to this award.

Related Government Programs

Flour Milling
Department of Defense Contracting
Defense Commissary Agency Programs

Risk Flags

Sole-source award
Lack of competition
Limited price discovery
Potential for overpayment
Missing justification for sole-source
Short contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.2 million to GENERAL MILLS INC. RESALE - FLOUR AND OTHER MISCELLANEOUS BAKING PRODUCTS

Who is the contractor on this award?

The obligated recipient is GENERAL MILLS INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Commissary Agency).

What is the total obligated amount?

The obligated amount is $33.2 million.

What is the period of performance?

Start: 2011-04-01. End: 2011-06-30.

What was the justification for awarding this contract on a sole-source basis, and was adequate market research performed?

The provided data indicates the contract was 'NOT AVAILABLE FOR COMPETITION,' suggesting a sole-source award. However, the specific justification and evidence of thorough market research are missing. Without this information, it's impossible to determine if alternative sources were considered or if this was truly the only viable option, potentially impacting value for money.

How does the per-unit cost of flour and baking products under this contract compare to market rates or other government contracts?

A direct per-unit cost comparison is not possible with the given data. The contract value is aggregated, and specific product details are limited. The lack of competition inherently makes it difficult to ascertain if the pricing is competitive. Benchmarking against commercial prices or other agency contracts would be necessary for a thorough assessment.

What is the long-term strategy for procuring these baking products, and will future procurements be competed?

The current contract is a delivery order with a short duration (90 days). This suggests it might be part of a larger, ongoing need. The sole-source nature of this award raises concerns about whether future requirements will be competed. A clear strategy for competitive procurement is essential to ensure long-term value and cost savings.

Industry Classification

NAICS: Manufacturing › Grain and Oilseed Milling › Flour Milling

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1 GENERAL MILLS BLVD, MINNEAPOLIS, MN, 55426

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $33,165,177

Exercised Options: $33,165,177

Current Obligation: $33,165,177

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HDEC0109G3837

IDV Type: IDC

Timeline