USDA's Agricultural Marketing Service awarded $34.9M for food boxes, with Premier Food Group Inc. as the sole contractor

Contract Overview

Contract Amount: $34,915,228 ($34.9M)

Contractor: Premier Food Group, Inc

Awarding Agency: Department of Agriculture

Start Date: 2020-05-14

End Date: 2020-09-19

Contract Duration: 128 days

Daily Burn Rate: $272.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 568

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 2000006919/4100020261/PRECOOKED MEAT BOX,FLUID MILK,COMBINATION BOX,FRESH FRUIT/VEGETABLE BOX,DAIRY PRODUCTS BOX

Place of Performance

Location: THIBODAUX, LAFOURCHE County, LOUISIANA, 70301

State: Louisiana Government Spending

Plain-Language Summary

Department of Agriculture obligated $34.9 million to PREMIER FOOD GROUP, INC for work described as: 2000006919/4100020261/PRECOOKED MEAT BOX,FLUID MILK,COMBINATION BOX,FRESH FRUIT/VEGETABLE BOX,DAIRY PRODUCTS BOX Key points: 1. The contract focused on providing essential food items, indicating a need for reliable supply chains. 2. A single awardee suggests potential limitations in market competition for this specific service. 3. The firm fixed-price structure aims to control costs, but requires careful monitoring of delivery and quality. 4. The short duration of the contract (128 days) implies an urgent or temporary need for these food supplies. 5. The geographic scope appears to be Louisiana, suggesting a localized impact. 6. The contract value is significant, highlighting the scale of federal procurement in food distribution.

Value Assessment

Rating: fair

The contract value of $34.9 million for a 128-day period is substantial. Benchmarking against similar federal food box contracts is difficult without more specific service details. However, the price per day is approximately $272,775. Given the firm fixed-price nature, the value is largely determined by the quantity and type of food items delivered. Without detailed unit costs or comparison data, assessing the exact value-for-money is challenging, but the scale suggests a significant investment in food provision.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. However, the data shows only one awardee, Premier Food Group, Inc. This could imply that while competition was solicited, only one bidder met the requirements or submitted a competitive offer. The presence of 568 bids suggests a high level of initial interest, but the single award may warrant further investigation into the evaluation criteria and the competitive landscape.

Taxpayer Impact: Full and open competition is generally beneficial for taxpayers as it encourages multiple vendors to offer their best prices and services, potentially leading to cost savings. However, a single award from a large pool of bids might indicate that the government did not achieve the most competitive pricing possible.

Public Impact

Beneficiaries likely include individuals and families receiving food assistance through USDA programs in Louisiana. Services delivered include the provision of precooked meat, fluid milk, combination boxes, fresh fruit/vegetable boxes, and dairy products. The geographic impact is concentrated in Louisiana, addressing specific regional food needs. Workforce implications could involve jobs in food processing, packaging, logistics, and distribution related to Premier Food Group, Inc. and its suppliers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for over-reliance on a single contractor if future needs arise.
Limited transparency on the specific breakdown of costs within the $34.9M award.
Ensuring consistent quality and timely delivery across all food categories is crucial.

Positive Signals

Successful award under full and open competition demonstrates market responsiveness.
The contract addresses critical needs for food provision.
Firm fixed-price contract provides cost certainty for the government.

Sector Analysis

This contract falls within the broader food services and distribution sector, a critical component of the federal supply chain. The USDA's Agricultural Marketing Service plays a key role in ensuring the availability and affordability of agricultural products. Spending in this area can fluctuate based on national needs, disaster relief efforts, and public health initiatives. Comparable spending benchmarks would involve analyzing other large-scale food procurement contracts by federal agencies, particularly those focused on emergency food relief or distribution programs.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. The primary awardee, Premier Food Group, Inc., is likely a larger entity. This means that the direct economic impact on the small business ecosystem through this specific contract may be limited unless the prime contractor actively engages small businesses in its supply chain.

Oversight & Accountability

Oversight for this contract would typically reside with the Agricultural Marketing Service (AMS) within the USDA. Accountability measures would include contract performance monitoring, delivery verification, and quality control checks. Transparency is facilitated through contract databases like FPDS, which provide basic award details. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

USDA Food Purchase Programs
National School Lunch Program
Supplemental Nutrition Assistance Program (SNAP)
Emergency Food Assistance Program (TEFAP)

Risk Flags

Potential for single-source dependency if future needs arise.
Risk of quality degradation if contractor faces cost pressures.
Limited visibility into specific unit pricing within the total award.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $34.9 million to PREMIER FOOD GROUP, INC. 2000006919/4100020261/PRECOOKED MEAT BOX,FLUID MILK,COMBINATION BOX,FRESH FRUIT/VEGETABLE BOX,DAIRY PRODUCTS BOX

Who is the contractor on this award?

The obligated recipient is PREMIER FOOD GROUP, INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $34.9 million.

What is the period of performance?

Start: 2020-05-14. End: 2020-09-19.

What is the track record of Premier Food Group, Inc. in fulfilling federal food supply contracts?

Premier Food Group, Inc. has a history of receiving federal contracts, particularly from agencies like the USDA. Analyzing their past performance on similar food box or supply contracts is crucial. This includes examining contract completion rates, any reported performance issues, and their capacity to handle large-scale procurements. A review of their contract history would reveal their experience in managing logistics, sourcing diverse food items, and meeting delivery schedules. While this specific $34.9 million contract was awarded under full and open competition, understanding their prior success or challenges in similar competitive environments provides insight into their reliability and capability as a federal contractor.

How does the value of this contract compare to similar federal food box procurements?

The $34.9 million awarded to Premier Food Group, Inc. for a 128-day period represents a significant investment. To benchmark its value, one would need to compare it against other USDA or agency contracts for similar food box provisions, considering factors like the number of boxes, types of food items included (e.g., fresh produce vs. shelf-stable), and the contract duration. For instance, contracts during the COVID-19 pandemic saw substantial spending on food boxes. Without specific unit costs or quantities, a direct comparison is difficult, but the daily expenditure rate of approximately $272,775 suggests a large-scale operation. If similar contracts over comparable periods involved fewer resources or lower unit costs, this award might be considered high, but it could also reflect specific market conditions or the complexity of the items procured.

What are the primary risks associated with this firm fixed-price contract for food provision?

The primary risks associated with this firm fixed-price contract revolve around ensuring the quality and timely delivery of perishable goods. While the fixed price protects the government from cost overruns, it places the risk of fluctuating food prices or supply chain disruptions on the contractor, Premier Food Group, Inc. If the contractor cannot procure the specified items at the agreed-upon price, they may cut corners on quality or face delivery delays. Potential risks include receiving substandard products, incomplete orders, or late deliveries, which could impact the intended beneficiaries. Effective government oversight and clear performance metrics are essential to mitigate these risks and ensure the contract's objectives are met.

What was the rationale behind awarding this contract to a single entity despite full and open competition?

Awarding a contract to a single entity after full and open competition, especially with 568 bids, suggests that only one bidder, Premier Food Group, Inc., was deemed to offer the best value according to the solicitation's evaluation criteria. This could be due to various factors: the technical approach proposed, past performance, specific qualifications, or the overall price competitiveness relative to the government's estimate. It's possible that other bidders, while numerous, did not meet all mandatory requirements, proposed higher prices, or offered less advantageous terms. The government aims to select the offer that best fulfills the requirements, and in this case, Premier Food Group, Inc. emerged as the chosen vendor.

How does this contract align with the USDA's broader mission regarding food security and agricultural markets?

This contract directly aligns with the USDA's mission to enhance food security and support American agricultural markets. By procuring food boxes containing a variety of items like fresh produce, dairy, and meat, the USDA ensures that essential nutritional needs are met for specific populations, likely those facing food insecurity. Simultaneously, these purchases provide a market for agricultural producers and processors, supporting demand within the domestic food supply chain. The Agricultural Marketing Service's role in facilitating these transactions underscores the USDA's commitment to both consumer access to food and the economic viability of the agricultural sector.

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: 123J1420R0377/4100020261

Offers Received: 568

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1600 RIDGEFIELD RD, THIBODAUX, LA, 70301

Business Categories: Category Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $34,915,228

Exercised Options: $34,915,228

Current Obligation: $34,915,228

Actual Outlays: $34,915,228

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline