DoD's $17M Pet Food Contract with Nestle Purina Raises Questions on Competition and Value
Contract Overview
Contract Amount: $17,039,413 ($17.0M)
Contractor: Nestle Purina Petcare CO
Awarding Agency: Department of Defense
Start Date: 2010-01-01
End Date: 2010-03-31
Contract Duration: 89 days
Daily Burn Rate: $191.5K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: RESALE - PET FOOD
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS CITY County, MISSOURI, 63102
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $17.0 million to NESTLE PURINA PETCARE CO for work described as: RESALE - PET FOOD Key points: 1. Significant spending on pet food for military personnel and their families. 2. Sole-source award to Nestle Purina PetCare Co. limits competitive pricing. 3. Lack of competition may lead to inflated prices compared to market rates. 4. The Defense Commissary Agency (DECACA) is responsible for this procurement.
Value Assessment
Rating: questionable
The contract's fixed price of $17 million for pet food lacks a clear benchmark for comparison due to the sole-source nature. Without competitive bidding, it's difficult to ascertain if this price represents fair market value for dog and cat food manufacturing.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, Nestle Purina PetCare Co., was considered. This significantly limits price discovery and competitive pressure, potentially resulting in higher costs for taxpayers.
Taxpayer Impact: The lack of competition in this $17 million contract may result in taxpayers paying more than necessary for pet food.
Public Impact
Provides essential pet food for military families, enhancing morale and quality of life. Supports a major pet food manufacturer, potentially impacting the broader pet food industry. The sole-source nature raises concerns about equitable distribution of government contracts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition.
- Potential for overpayment due to lack of competitive bidding.
- Limited transparency on pricing justification.
Positive Signals
- Ensures availability of essential pet food for military personnel.
- Supports a known brand, potentially ensuring quality.
Sector Analysis
This contract falls under the Dog and Cat Food Manufacturing sector (NAICS 311111). Spending benchmarks for this specific type of sole-source procurement are difficult to establish, but competitive bids typically drive down costs in this consumer goods market.
Small Business Impact
This contract was awarded to a large corporation, Nestle Purina PetCare Co., and does not appear to include provisions or set-asides for small businesses. The sole-source nature further precludes small businesses from competing.
Oversight & Accountability
The Defense Commissary Agency (DECACA) is responsible for this contract. Oversight should focus on ensuring the justification for the sole-source award is robust and that the pricing is reasonable, even without competition.
Related Government Programs
- Dog and Cat Food Manufacturing
- Department of Defense Contracting
- Defense Commissary Agency Programs
Risk Flags
- Lack of competitive bidding.
- Potential for inflated pricing.
- Limited transparency on justification for sole-source award.
- No small business participation.
Tags
dog-and-cat-food-manufacturing, department-of-defense, mo, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $17.0 million to NESTLE PURINA PETCARE CO. RESALE - PET FOOD
Who is the contractor on this award?
The obligated recipient is NESTLE PURINA PETCARE CO.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Commissary Agency).
What is the total obligated amount?
The obligated amount is $17.0 million.
What is the period of performance?
Start: 2010-01-01. End: 2010-03-31.
What was the specific justification for awarding this contract as sole-source to Nestle Purina PetCare Co.?
The provided data does not specify the justification for the sole-source award. Typically, sole-source contracts are justified when only one responsible source can provide the required supplies or services, or in cases of urgent and compelling need. Further investigation into DECACA's procurement records would be necessary to determine the exact rationale.
How does the per-unit cost of this contract compare to commercially available pet food from the same manufacturer?
A direct per-unit cost comparison is not feasible with the provided data. The contract value is a total amount, and unit details (like bag size, specific product type) are missing. Furthermore, government contracts may include different terms, delivery schedules, and quantities than retail purchases, making a direct comparison challenging without more granular information.
What mechanisms are in place to ensure the quality and appropriateness of the pet food provided under this sole-source contract?
While the data doesn't detail quality assurance mechanisms, government contracts typically include specifications for product quality, safety, and performance. The Defense Commissary Agency would likely have quality control measures and inspection processes to ensure the pet food meets the required standards, even under a sole-source agreement.
Industry Classification
NAICS: Manufacturing › Animal Food Manufacturing › Dog and Cat Food Manufacturing
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: 801 CHOUTEAU AVE, SAINT LOUIS, MO, 63102
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: $17,039,413
Exercised Options: $17,039,413
Current Obligation: $17,039,413
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HDEC0110G3930
IDV Type: IDC
Timeline
Start Date: 2010-01-01
Current End Date: 2010-03-31
Potential End Date: 2010-03-31 00:00:00
Last Modified: 2019-06-07
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