USDA's $41.7M contract for precooked meat and dairy products awarded to Menu Maker Foods, Inc

Contract Overview

Contract Amount: $41,667,065 ($41.7M)

Contractor: Menu Maker Foods, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2020-05-15

End Date: 2020-09-19

Contract Duration: 127 days

Daily Burn Rate: $328.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 568

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 2000006919/4100020190/PRECOOKED MEAT BOX,FLUID MILK,DAIRY PRODUCTS BOX

Place of Performance

Location: CHILLICOTHE, LIVINGSTON County, MISSOURI, 64601

State: Missouri Government Spending

Plain-Language Summary

Department of Agriculture obligated $41.7 million to MENU MAKER FOODS, INC. for work described as: 2000006919/4100020190/PRECOOKED MEAT BOX,FLUID MILK,DAIRY PRODUCTS BOX Key points: 1. The contract value of $41.7 million represents a significant investment in food supply chain resilience. 2. Menu Maker Foods, Inc. secured this contract through full and open competition, indicating a competitive bidding process. 3. The firm fixed-price contract type suggests that pricing was established upfront, potentially mitigating cost overruns. 4. The contract duration of 127 days indicates a short-term need for these specific food items. 5. The North American Industry Classification System (NAICS) code 311612 points to the meat processing sector. 6. The Agricultural Marketing Service (AMS) is responsible for overseeing this procurement, aligning with its mission to facilitate marketing of agricultural products.

Value Assessment

Rating: good

Benchmarking the value of this contract is challenging without specific unit cost data. However, the total award of $41.7 million for a 127-day period for precooked meat and dairy products suggests a substantial volume of goods. The firm fixed-price nature of the contract implies that the contractor assumed the risk for cost fluctuations, which is generally favorable for the government when executed effectively. Further analysis would require comparing the unit prices to similar procurements for comparable food items during the same period.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit bids. The data indicates 568 offers were received, suggesting a highly competitive environment. A large number of bidders typically leads to more competitive pricing and a wider selection of qualified contractors, which is beneficial for the government in securing the best value.

Taxpayer Impact: The extensive competition for this contract likely resulted in taxpayer savings by driving down the price of the food products procured. It also ensures that the government is not locked into a single supplier, promoting market efficiency.

Public Impact

The primary beneficiaries of this contract are likely federal agencies and potentially military installations requiring precooked meat and dairy products for their food service operations. The services delivered include the provision of essential food items, contributing to the operational readiness and sustenance of government entities. The geographic impact is primarily focused on the delivery locations specified within the contract, though the sourcing of ingredients may have broader implications. Workforce implications could include employment opportunities within Menu Maker Foods, Inc. and its supply chain, particularly in food processing and logistics.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases in subsequent contracts if competition diminishes.
Dependence on a single contractor for a critical food supply could pose a risk if the contractor faces operational disruptions.
Ensuring consistent quality and safety standards across all delivered products requires robust oversight.

Positive Signals

Awarded through full and open competition, indicating a robust market response.
Firm fixed-price contract structure helps control costs for the government.
The large number of offers received suggests a healthy competitive landscape.

Sector Analysis

The food processing industry, specifically the segment dealing with prepared meats and dairy products, is a vital part of the broader agricultural supply chain. This contract falls within the scope of government procurement aimed at ensuring food security and operational support for various federal agencies. Comparable spending benchmarks would involve analyzing other large-scale food service contracts awarded by agencies like the Department of Defense or the Federal Bureau of Prisons, considering the specific types of food items and contract durations.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a specific small business set-aside. While Menu Maker Foods, Inc. may utilize small businesses in its supply chain, there is no direct indication of subcontracting goals or impacts on the small business ecosystem from the provided data. Further investigation into the contractor's subcontracting plan would be necessary to assess this aspect.

Oversight & Accountability

Oversight for this contract would typically be managed by the Agricultural Marketing Service (AMS), the awarding agency. Accountability measures are inherent in the firm fixed-price contract, requiring the contractor to deliver specified goods at the agreed-upon price. Transparency is generally facilitated through federal procurement databases where contract awards are published. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Department of Agriculture Food Purchases
Federal Food Service Contracts
Commodity Procurement Programs
National School Lunch Program (related sector)

Risk Flags

Potential for quality degradation due to perishable nature of some items.
Risk of supply chain disruptions impacting timely delivery.
Need for stringent quality control and inspection protocols.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $41.7 million to MENU MAKER FOODS, INC.. 2000006919/4100020190/PRECOOKED MEAT BOX,FLUID MILK,DAIRY PRODUCTS BOX

Who is the contractor on this award?

The obligated recipient is MENU MAKER 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 $41.7 million.

What is the period of performance?

Start: 2020-05-15. End: 2020-09-19.

What is the historical spending pattern of the Agricultural Marketing Service (AMS) on precooked meat and dairy products?

Analyzing the historical spending patterns of the Agricultural Marketing Service (AMS) on precooked meat and dairy products requires access to detailed procurement data over multiple fiscal years. Without specific historical data for this contract line item, it's difficult to provide a precise trend. However, AMS, as part of the USDA, is involved in various programs that procure agricultural commodities. Spending in this area can fluctuate based on program needs, budget allocations, and market conditions for dairy and meat products. For instance, disaster relief efforts, school lunch programs, or strategic reserves could influence AMS procurement volumes and values. A comprehensive review of historical AMS contracts, filtered by relevant NAICS codes (like 311612 for meat processing and 311511 for fluid milk) and product descriptions, would be necessary to identify any significant trends, seasonality, or changes in spending levels over time.

How does the unit price of the products in this contract compare to market rates for similar items during the contract period?

To compare the unit price of products in this contract to market rates, specific details on the quantities and types of precooked meat and dairy products are needed, alongside their respective prices. The provided data aggregates the total award amount ($41.7 million) over the contract duration (127 days) but does not break down the specific items or their individual costs. Market rates for food items fluctuate based on factors like commodity prices, seasonality, and geographic location. A thorough comparison would involve obtaining the detailed line-item pricing from the contract award and cross-referencing it with contemporaneous market data from sources such as the Bureau of Labor Statistics (BLS) Producer Price Index (PPI) for relevant food categories, USDA agricultural market reports, or private sector food price indices. Without this granular data, a precise unit cost comparison is not feasible.

What is the track record of Menu Maker Foods, Inc. in fulfilling federal contracts, particularly those with the Department of Agriculture?

Assessing the track record of Menu Maker Foods, Inc. in fulfilling federal contracts requires a review of their past performance data, which is often available through federal procurement databases like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS). This data would detail previous awards, contract types, agencies served, and performance ratings. For this specific contract with the USDA's Agricultural Marketing Service (AMS), understanding their history with AMS would be particularly relevant. Key indicators of a strong track record include consistent on-time delivery, adherence to quality specifications, compliance with contract terms, and positive performance reviews. Conversely, a history of contract terminations, disputes, or poor performance ratings would raise concerns. Without direct access to their detailed performance history, it is difficult to definitively assess their track record.

What are the potential risks associated with a firm fixed-price contract for perishable food items like dairy products?

Firm fixed-price (FFP) contracts are generally advantageous for the government as they shift cost overrun risks to the contractor. However, for perishable food items like dairy products, there are specific risks. If the contractor miscalculates the costs associated with spoilage, storage, or rapid delivery needed to maintain freshness, they could incur losses, potentially leading to quality compromises or delivery issues to avoid further losses. Conversely, if the market price of dairy products drops significantly after the contract is awarded, the contractor might be incentivized to cut corners on quality or service to protect their profit margin, although the FFP structure aims to prevent this. Effective quality assurance and inspection protocols by the government are crucial to mitigate these risks and ensure that the contractor upholds product quality and timely delivery despite the fixed-price nature of the agreement.

How does the number of bids received (568) impact the government's ability to secure competitive pricing for food supplies?

Receiving 568 bids for this contract is a strong indicator of robust competition, which significantly enhances the government's ability to secure competitive pricing. A large number of bidders typically means that multiple companies are vying for the contract, driving down prices as each competitor seeks to offer the most attractive bid. This scenario increases the likelihood that the government will receive offers close to the contractors' actual costs plus a reasonable profit margin, rather than prices inflated by a lack of market alternatives. Furthermore, a high number of bids suggests that the market is healthy and that the contract requirements were well-defined and accessible to a broad range of potential suppliers. This competitive pressure is a key mechanism for ensuring value for taxpayer money in government procurement.

Industry Classification

NAICS: Manufacturing › Animal Slaughtering and Processing › Meat Processed from Carcasses

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 123J1420R0377/4100020190

Offers Received: 568

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Menu Maker Foods, LLC

Address: 725 INDUSTRIAL RD, CHILLICOTHE, MO, 64601

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Economically Disadvantaged Women Owned Small Business, Manufacturer of Goods, Minority Owned Business, Other Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $41,667,065

Exercised Options: $41,667,065

Current Obligation: $41,667,065

Actual Outlays: $39,936,124

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline