DoD's $33M Flour Purchase: General Mills Awarded Sole-Source Contract for Baking Products

Contract Overview

Contract Amount: $33,130,277 ($33.1M)

Contractor: General Mills Inc

Awarding Agency: Department of Defense

Start Date: 2011-07-01

End Date: 2011-09-30

Contract Duration: 91 days

Daily Burn Rate: $364.1K/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 $33.1 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 raises competition concerns. 3. Limited duration contract with a fixed price. 4. Potential for higher costs due to lack of competition.

Value Assessment

Rating: questionable

The contract value of $33.1M for a 3-month period is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to market rates for similar flour and baking products.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was not available for competition, indicating a sole-source award. This limits price discovery and may result in the government paying a premium compared to a competitive environment.

Taxpayer Impact: Taxpayers may have overpaid due to the absence of competitive bidding, as the government did not leverage market forces to secure the best possible price.

Public Impact

Ensures availability of essential baking ingredients for military personnel and families. Supports a major food manufacturer, potentially impacting the broader food supply chain. Highlights reliance on specific suppliers for critical goods.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price negotiation.
Short contract duration may not reflect long-term market trends.
Lack of small business participation noted.

Positive Signals

Ensures supply of critical baking ingredients.
Utilizes a known supplier for the Defense Commissary Agency.

Sector Analysis

This purchase falls under the food manufacturing and wholesale trade sector. Spending benchmarks for flour and baking products can vary significantly based on commodity prices and market conditions.

Small Business Impact

The data indicates no small business participation in this contract. This suggests opportunities may have been missed to engage smaller businesses within the baking ingredients supply chain.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny to ensure the price paid was fair and reasonable, and that future procurements are competed whenever possible.

Related Government Programs

Flour Milling
Department of Defense Contracting
Defense Commissary Agency Programs

Risk Flags

Sole-source award
Lack of competition
No small business participation
Short contract duration
Potential for overpayment

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $33.1 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 $33.1 million.

What is the period of performance?

Start: 2011-07-01. End: 2011-09-30.

What was the justification for the sole-source award, and was a market research conducted to confirm the necessity?

The justification for the sole-source award is not provided in the data. Typically, sole-source contracts are used when only one responsible source can provide the required supplies or services. A thorough market research should have been conducted to validate this claim and explore any potential for competition, even if limited.

How does the per-unit cost of this flour purchase compare to commercial market prices during the contract period?

Without specific per-unit cost data and commercial market price benchmarks for flour during July-September 2011, a direct comparison is not possible. However, given the sole-source nature, there is a risk that the government did not achieve the most favorable pricing available through competitive bidding.

What is the long-term strategy for procuring these baking products to ensure better value and competition?

The long-term strategy is unclear from this single contract. Agencies should aim to break down requirements into competitively sourced contracts where feasible. Exploring options for longer-term agreements with built-in price adjustments or conducting market research for alternative suppliers could improve future value and competition.

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: $33,130,277

Exercised Options: $33,130,277

Current Obligation: $33,130,277

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HDEC0109G3837

IDV Type: IDC

Timeline