DoD's $63M MRE Contract with SO-PAK-CO, Inc. Faces Scrutiny Over Pricing and Competition
Contract Overview
Contract Amount: $63,027,804 ($63.0M)
Contractor: So-Pak-Co, Inc
Awarding Agency: Department of Defense
Start Date: 2014-11-17
End Date: 2015-12-31
Contract Duration: 409 days
Daily Burn Rate: $154.1K/day
Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 8501566370!MEAL, READY-TO-EAT, IND,
Place of Performance
Location: MULLINS, MARION County, SOUTH CAROLINA, 29574, UNITED STATES OF AMERICA
Plain-Language Summary
Department of Defense obligated $63.0 million to SO-PAK-CO, INC for work described as: 8501566370!MEAL, READY-TO-EAT, IND, Key points: 1. The contract awarded to SO-PAK-CO, Inc. for MREs represents a significant expenditure within the Defense Logistics Agency's food supply chain. 2. Competition was limited, raising questions about price discovery and potential taxpayer impact. 3. The 'Fruit and Vegetable Canning' PSC code suggests a niche but essential component of military rations. 4. The contract's duration and firm fixed price structure aim for cost predictability, but the limited competition warrants further review.
Value Assessment
Rating: questionable
The contract value of $63M over approximately 1.3 years needs careful benchmarking against similar MRE procurements. Without detailed cost breakdowns or competitive bids, it's difficult to definitively assess if the price is optimal.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating a non-standard competitive process. This method can limit the pool of bidders and potentially lead to higher prices than a truly open competition.
Taxpayer Impact: The limited competition raises concerns about whether the government secured the best possible price for these essential MREs, potentially impacting taxpayer funds.
Public Impact
Ensures availability of essential MRE components for military personnel. Potential for higher costs due to limited competition affects overall defense budget allocation. Highlights the importance of robust competition strategies in defense procurement.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition raises price concerns
- Lack of clear per-unit cost benchmark
- Unusual competition exclusion method
Positive Signals
- Contract awarded for essential supplies
- Firm fixed price for cost predictability
Sector Analysis
This contract falls under the broader defense logistics and food services sector. Spending benchmarks for MREs can vary significantly based on specific components, quantities, and contract types. The $63M value is substantial for this specific item category.
Small Business Impact
The data does not indicate whether small businesses were involved in this specific contract, either as prime contractors or subcontractors. Further investigation would be needed to assess small business participation.
Oversight & Accountability
The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' method suggests a specific justification was required, implying some level of oversight. However, the effectiveness of this oversight in ensuring optimal pricing is unclear without further review.
Related Government Programs
- Fruit and Vegetable Canning
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Limited competition may result in higher costs.
- Lack of transparent per-unit cost data.
- Unusual procurement method requires justification.
- Potential for price not being optimized.
- Dependence on a single contractor for critical supplies.
Tags
fruit-and-vegetable-canning, department-of-defense, sc, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $63.0 million to SO-PAK-CO, INC. 8501566370!MEAL, READY-TO-EAT, IND,
Who is the contractor on this award?
The obligated recipient is SO-PAK-CO, INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $63.0 million.
What is the period of performance?
Start: 2014-11-17. End: 2015-12-31.
What was the specific justification for excluding sources in this 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' award, and how did it impact the final price?
The justification for excluding sources is critical. If based on unique capabilities or specific requirements not met by other vendors, it might explain the limited competition. However, if the exclusion was arbitrary or poorly justified, it could have artificially inflated the price, leading to a less favorable outcome for taxpayers. Understanding the rationale is key to assessing value.
How does the per-unit cost of these MRE components compare to industry benchmarks or historical government purchases of similar items?
Without a clear per-unit cost benchmark, assessing the value for money is challenging. Comparing this contract's pricing to historical data for similar MREs or to commercial off-the-shelf equivalents (if applicable) would reveal potential overpricing or cost savings. A significant deviation from benchmarks would signal a need for deeper investigation into the contract's financial terms and competitive landscape.
What measures are in place to ensure the quality and timely delivery of these MREs, given the specialized nature of the product and the limited competition?
Ensuring quality and timely delivery is paramount for military readiness. Given the limited competition, oversight mechanisms like stringent quality assurance checks, performance monitoring, and clear delivery schedules are crucial. The contract type (firm fixed price) incentivizes the contractor to meet these terms, but proactive monitoring by the Defense Logistics Agency is essential to mitigate risks associated with a single-source or limited-source award.
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: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Unaka Company, Incorporated (UEI: 003374477)
Address: 118 S CYPRESS ST, MULLINS, SC, 29574
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Labor Surplus Area Firm, Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $63,027,804
Exercised Options: $63,027,804
Current Obligation: $63,027,804
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: SPM3S112DZ108
IDV Type: IDC
Timeline
Start Date: 2014-11-17
Current End Date: 2015-12-31
Potential End Date: 2015-12-31 00:00:00
Last Modified: 2016-03-03
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