Defense Commissary Agency awards $32.4M contract for flour and baking products to General Mills Inc

Contract Overview

Contract Amount: $32,379,477 ($32.4M)

Contractor: General Mills Inc

Awarding Agency: Department of Defense

Start Date: 2012-07-01

End Date: 2012-09-30

Contract Duration: 91 days

Daily Burn Rate: $355.8K/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 $32.4 million to GENERAL MILLS INC for work described as: RESALE - FLOUR AND OTHER MISCELLANEOUS BAKING PRODUCTS Key points: 1. Contract awarded to a single, well-established supplier, raising questions about competitive pricing. 2. Limited competition may have led to higher costs for essential baking ingredients. 3. The contract duration of 91 days suggests a short-term need or a bridge to a larger procurement. 4. Performance context is limited due to the short duration and lack of publicly available performance metrics. 5. Sector positioning is within the food and beverage supply chain for military commissaries. 6. The fixed-price contract type offers cost certainty but limits potential savings from market fluctuations.

Value Assessment

Rating: fair

Benchmarking the value of this specific contract is challenging without comparable data for flour and miscellaneous baking products procured by the Defense Commissary Agency. The raw dollar amount of $32.4 million for a 91-day period appears substantial, but its true value depends on the quantity and specific types of products procured. The lack of competition suggests that the pricing may not have been optimized through a competitive bidding process, potentially leading to a less favorable price than could have been achieved in an open market.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not openly competed. This approach is typically used when only one supplier can meet the specific requirements, or in urgent situations. The absence of multiple bidders means there was no direct price comparison or negotiation driven by market competition, which can limit the government's ability to secure the best possible price.

Taxpayer Impact: Taxpayers may have paid a premium due to the lack of competitive bidding, as the government did not benefit from the price discovery mechanisms inherent in an open competition.

Public Impact

Military personnel and their families benefit from the availability of essential baking ingredients through commissaries. Services delivered include the supply of flour and other miscellaneous baking products to support commissary operations. Geographic impact is likely nationwide, serving commissaries wherever these products are stocked. Workforce implications are minimal for the government, but the contract supports jobs within General Mills Inc.'s supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in inflated prices.
Limited contract duration makes long-term planning difficult.
Absence of detailed performance metrics hinders evaluation of effectiveness.

Positive Signals

Award to a known entity, General Mills Inc., suggests a degree of reliability.
Fixed-price contract provides budget certainty for the period.
Ensures availability of essential goods for military families.

Sector Analysis

The food and beverage sector is a critical component of the broader economy, with significant government procurement activity related to food services, commissaries, and military operations. The market for flour and baking ingredients is mature, with several large players. However, specific contracts for military commissaries often involve unique distribution and volume requirements. Benchmarking this contract's value is difficult without detailed product specifications and quantities, but the $32.4 million figure for a short period indicates a substantial procurement.

Small Business Impact

This contract does not appear to have a small business set-aside component, nor is there information indicating significant subcontracting opportunities for small businesses. The award to a large corporation like General Mills Inc. suggests that the primary focus was on fulfilling a large-scale requirement, potentially overlooking opportunities to engage the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Commissary Agency's contracting and financial management divisions. Accountability measures would be tied to delivery schedules and product quality as specified in the contract terms. Transparency is limited by the sole-source nature of the award and the lack of publicly detailed performance data. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Commissary Agency Food Procurement
Military Food Services Contracts
Commodity Food Purchases by Government Agencies

Risk Flags

Sole-source award lacks competitive pricing.
Limited contract duration.
Lack of detailed performance data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.4 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 $32.4 million.

What is the period of performance?

Start: 2012-07-01. End: 2012-09-30.

What specific types and quantities of flour and miscellaneous baking products were included in this $32.4 million contract?

The provided data does not specify the exact types and quantities of flour and miscellaneous baking products covered under this contract. The description 'RESALE - FLOUR AND OTHER MISCELLANEOUS BAKING PRODUCTS' is broad. To conduct a thorough value analysis, detailed product lists, specifications, and quantities would be necessary. Without this granular information, it is difficult to ascertain if the $32.4 million award represents a fair market price for the goods delivered over the 91-day period.

Why was this contract awarded on a sole-source basis instead of being competed openly?

The data indicates the contract was 'NOT AVAILABLE FOR COMPETITION,' which typically signifies a sole-source award. Common justifications for sole-source procurements include situations where only one responsible source can provide the required supplies or services, or in cases of urgent and compelling need. Without further documentation from the Defense Commissary Agency, the specific rationale for not competing this contract remains unclear. This lack of competition is a key factor in assessing the potential value for money.

How does the pricing of this contract compare to similar procurements for baking ingredients by other federal agencies or the private sector?

Direct comparison of pricing is difficult without knowing the specific product mix and quantities. However, sole-source awards generally carry a higher risk of non-competitive pricing compared to fully competed contracts. If General Mills Inc. was the only viable supplier for these specific needs, the pricing might reflect that market position rather than competitive market rates. A benchmark against commercial bulk flour and baking ingredient prices would be informative, but would need to account for delivery, packaging, and any specific military-grade requirements.

What performance metrics were used to evaluate General Mills Inc.'s fulfillment of this contract?

The provided data does not include information on specific performance metrics or evaluation criteria for this contract. Typically, contracts include clauses related to delivery timeliness, product quality, and adherence to specifications. For a short-term contract like this (91 days), performance evaluation might have been less rigorous than for longer-term agreements. The absence of detailed performance data makes it challenging to assess the contractor's effectiveness and the overall success of the procurement.

What is the historical spending pattern for flour and baking products by the Defense Commissary Agency?

The provided data only includes details for this specific contract award. To understand historical spending patterns, one would need to analyze procurement data for the Defense Commissary Agency over multiple fiscal years, specifically looking for contracts related to flour, baking ingredients, and similar food items. This analysis would reveal trends in spending, identify key suppliers, and highlight any shifts in procurement strategies or pricing over time.

What is the potential impact of this sole-source award on future competition for similar contracts?

A sole-source award, especially if perceived as not fully justified, can sometimes discourage future competition. Potential bidders might assume that future awards will also be non-competitive or that the incumbent has an insurmountable advantage. Conversely, if the sole-source justification was specific to unique circumstances or urgent needs, it might not significantly impact future open competitions. The Defense Commissary Agency's future procurement strategies will be key indicators.

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: $32,379,477

Exercised Options: $32,379,477

Current Obligation: $32,379,477

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HDEC0109G3837

IDV Type: IDC

Timeline