USDA contract for applesauce and other canned goods awarded to Burnette Foods, Inc. for over $2 million

Contract Overview

Contract Amount: $2,039,398 ($2.0M)

Contractor: Burnette Foods, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2024-08-01

End Date: 2024-12-31

Contract Duration: 152 days

Daily Burn Rate: $13.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 13

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000010212/4100030581/APPLESAUCE CUP-96/4.5,APPLESAUCE CAN-24/300,APPLESAUCE CUP SLEEVE-6/4 OZ

Place of Performance

Location: HARTFORD, VAN BUREN County, MICHIGAN, 49057

State: Michigan Government Spending

Plain-Language Summary

Department of Agriculture obligated $2.0 million to BURNETTE FOODS, INC. for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000010212/4100030581/APPLESAUCE CUP-96/4.5,APPLESAUCE CAN-24/300,APPLESAUCE CUP SLEEVE-6/4 OZ Key points: 1. The contract focuses on essential food commodities for U.S. government food donation programs. 2. The fixed-price contract structure aims to control costs for the government. 3. The award was made under a 'full and open competition after exclusion of sources' basis, suggesting a competitive process with specific justifications. 4. The contract duration is 152 days, indicating a short-term need for these specific commodities. 5. The primary commodity listed is applesauce in various packaging formats, highlighting a specific dietary need or preference. 6. The contract value of $2,039,398.04 represents a significant investment in food security initiatives.

Value Assessment

Rating: good

The contract value of over $2 million for canned goods appears reasonable given the quantity and type of items procured. The firm fixed-price structure helps mitigate cost overruns. Benchmarking against similar large-scale food procurement contracts would provide further insight into value for money, but the scale suggests a competitive bid process likely yielded a fair price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'full and open competition after exclusion of sources.' This indicates that while the competition was intended to be broad, specific sources may have been excluded for documented reasons. The presence of 13 bids suggests a healthy level of competition, which generally leads to better price discovery and value for the government.

Taxpayer Impact: The competitive nature of this award, despite potential source exclusions, suggests that taxpayers are likely benefiting from a price that reflects market conditions and multiple offers.

Public Impact

Beneficiaries include recipients of U.S. government food donation programs, potentially including food banks, disaster relief efforts, and international aid. The services delivered involve the procurement and supply of essential canned food items, specifically applesauce in various packaging. The geographic impact is national, as these commodities are intended for distribution through federal programs across the United States. Workforce implications are primarily within the food manufacturing and logistics sectors, supporting jobs at Burnette Foods, Inc. and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions impacting timely delivery of essential food items.
Quality control and consistency of canned goods across large batches require ongoing monitoring.
Dependence on a single awardee for a significant quantity of a specific commodity could pose a risk if issues arise.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Award to an established food manufacturer suggests a reliable supply capability.
The contract supports federal food donation programs, addressing food security needs.

Sector Analysis

This contract falls within the broader food manufacturing and processing sector, specifically focusing on canned goods. The market for government food procurement is substantial, driven by various federal programs like food assistance, military rations, and disaster relief. Comparable spending benchmarks would involve analyzing other large-scale procurements of non-perishable food items by agencies like USDA, DOD, and FEMA.

Small Business Impact

The data indicates that small business participation was not a primary focus for this specific award, as Burnette Foods, Inc. is likely a larger entity and the contract was not set aside for small businesses. There is no explicit mention of subcontracting requirements for small businesses within the provided data, suggesting limited direct impact on the small business ecosystem for this particular procurement.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Agriculture's Agricultural Marketing Service. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified goods at the agreed-upon price. Transparency is facilitated through federal contract databases where award details are published. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

USDA Food Purchase Programs
National School Lunch Program
Commodity Supplemental Food Program
Federal Disaster Relief Food Supplies
Military Food Procurement

Risk Flags

Potential for supply chain disruptions
Quality control of bulk food items
Short contract duration may limit long-term planning
Dependence on specific packaging formats

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $2.0 million to BURNETTE FOODS, INC.. COMMODITIES FOR USG FOOD DONATIONS: 2000010212/4100030581/APPLESAUCE CUP-96/4.5,APPLESAUCE CAN-24/300,APPLESAUCE CUP SLEEVE-6/4 OZ

Who is the contractor on this award?

The obligated recipient is BURNETTE FOODS, INC..

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Agricultural Marketing Service).

What is the total obligated amount?

The obligated amount is $2.0 million.

What is the period of performance?

Start: 2024-08-01. End: 2024-12-31.

What is the historical spending pattern for applesauce and similar canned goods by the Department of Agriculture?

Analyzing historical spending patterns for applesauce and similar canned goods by the Department of Agriculture (USDA) requires access to detailed procurement data over multiple fiscal years. Typically, USDA procures large quantities of shelf-stable food items to support various domestic and international food assistance programs. Spending can fluctuate based on program needs, appropriations, and market prices for agricultural commodities. For instance, during periods of increased food insecurity or specific disaster relief efforts, the volume and value of such contracts may rise. Comparing the current $2.04 million award for applesauce to previous years' spending on comparable items would reveal trends in volume, pricing, and supplier concentration. This analysis helps in assessing whether the current contract represents a typical procurement or an outlier in terms of cost or quantity.

How does the unit cost of applesauce in this contract compare to commercial retail prices or other government contracts?

Directly comparing the unit cost of applesauce in this contract to commercial retail prices is challenging without knowing the exact unit size and packaging details for each item (e.g., 4.5 oz cups vs. 300 oz cans). Government contracts often procure in bulk, which can lead to lower per-unit costs than retail, but may also include specific packaging or quality requirements that influence price. The data lists 'APPLESAUCE CUP-96/4.5', 'APPLESAUCE CAN-24/300', and 'APPLESAUCE CUP SLEEVE-6/4 OZ'. To benchmark, one would need to calculate the cost per ounce for each item type and compare it to wholesale or bulk pricing data for similar food service products. Additionally, comparing it to other federal contracts for applesauce, especially those awarded through similar competitive processes, would provide a more direct government-to-government benchmark for value.

What are the specific justifications for excluding certain sources in this 'full and open competition after exclusion of sources' award?

The designation 'full and open competition after exclusion of sources' implies that the solicitation was initially intended for broad competition, but specific potential offerors were identified and excluded prior to or during the evaluation process. The Federal Acquisition Regulation (FAR) outlines specific circumstances under which sources may be excluded, such as if a source failed to meet minimum responsibility standards, did not submit a timely proposal, or if there were documented reasons related to past performance or capability. For this specific contract, the justification for excluding sources would be detailed in the contract file and procurement documentation maintained by the Agricultural Marketing Service. These justifications are crucial for ensuring the integrity of the procurement process and demonstrating that the final award was made to a responsible contractor under fair competitive conditions, even with prior exclusions.

What is Burnette Foods, Inc.'s track record with federal food procurement contracts?

Burnette Foods, Inc. has a history of supplying food products to various government entities. Examining their past performance on federal contracts, particularly with the Department of Agriculture (USDA) and potentially other agencies like the Defense Logistics Agency (DLA), is essential. Key aspects to review include their on-time delivery rates, product quality compliance, contract modifications, and any past performance evaluations or disputes. A strong track record with previous government food contracts suggests a higher likelihood of successful performance on this current award. Conversely, any history of significant performance issues, contract terminations, or quality control problems would represent a notable risk factor that warrants closer scrutiny.

What are the potential risks associated with the short contract duration (152 days) for these essential food commodities?

A short contract duration of 152 days for essential food commodities like applesauce can present several risks. Firstly, it may indicate a time-sensitive need, such as responding to a specific program requirement or a temporary supply gap, which could imply less flexibility if unforeseen issues arise. Secondly, it might limit the contractor's ability to optimize production and logistics for economies of scale, potentially impacting unit costs. From a government perspective, a short duration necessitates a prompt re-solicitation process to ensure continuity of supply, adding administrative burden and potential market volatility if future procurements face different competitive landscapes. It also means less opportunity to build a long-term, stable supply relationship.

Industry Classification

NAICS: Manufacturing › Fruit and Vegetable Preserving and Specialty Food Manufacturing › Fruit and Vegetable Canning

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1424B0512

Offers Received: 13

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 701 S US HIGHWAY 31, ELK RAPIDS, MI, 49629

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $2,039,398

Exercised Options: $2,039,398

Current Obligation: $2,039,398

Actual Outlays: $2,038,359

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline