USDA's Agricultural Marketing Service awards $4.8M contract for canned apple products to Knouse Foods, Inc

Contract Overview

Contract Amount: $4,848,738 ($4.8M)

Contractor: Knouse Foods, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2023-11-16

End Date: 2024-03-31

Contract Duration: 136 days

Daily Burn Rate: $35.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000009646/4100028648/APPLE SLICES CAN-6/10,APPLESAUCE UNSWEETENED CAN-6/10

Place of Performance

Location: ORRTANNA, ADAMS County, PENNSYLVANIA, 17353

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Agriculture obligated $4.8 million to KNOUSE FOODS, INC. for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000009646/4100028648/APPLE SLICES CAN-6/10,APPLESAUCE UNSWEETENED CAN-6/10 Key points: 1. Contract awarded for canned apple slices and applesauce, essential for food donation programs. 2. Knouse Foods, Inc. secured the contract, indicating potential market concentration or specialized capability. 3. The contract's 'Full and Open Competition After Exclusion of Sources' method warrants scrutiny for its impact on price discovery. 4. Spending in the Fruit and Vegetable Canning sector is influenced by agricultural yields and demand for processed goods.

Value Assessment

Rating: fair

The contract value of $4.8M for canned fruit products appears reasonable given the quantity and type of goods. Benchmarking against similar large-scale food procurement contracts would provide a clearer assessment of value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The competition method, 'Full and Open Competition After Exclusion of Sources,' suggests that while open to all, certain sources were initially excluded. This could limit competitive pressure and potentially impact price discovery, though the 'full and open' aspect aims to mitigate this.

Taxpayer Impact: Taxpayer funds are utilized for food donations, aiming to support food security initiatives. The efficiency of the procurement process directly impacts the volume and cost of donated goods.

Public Impact

Ensures availability of essential food items for federal food donation programs, supporting vulnerable populations. Supports the agricultural sector by providing a market for processed fruit products. The procurement process impacts the cost-effectiveness of federal food assistance and donation efforts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition method could lead to higher prices.
Lack of small business participation noted.

Positive Signals

Supports critical food donation programs.
Firm fixed price contract provides cost certainty.

Sector Analysis

The Fruit and Vegetable Canning sector is characterized by seasonal production and the need for efficient processing and distribution. Federal contracts for these commodities are often substantial, supporting large-scale food assistance programs.

Small Business Impact

The data indicates no small business participation in this contract. Further analysis is needed to determine if opportunities for small businesses in this sector were overlooked or if the contract's nature favored larger entities.

Oversight & Accountability

The 'Full and Open Competition After Exclusion of Sources' method requires careful justification to ensure it serves the government's best interest and does not unduly restrict competition. Oversight should confirm adherence to procurement regulations.

Related Government Programs

Fruit and Vegetable Canning
Department of Agriculture Contracting
Agricultural Marketing Service Programs

Risk Flags

Limited competition method raises concerns about price optimization.
No small business participation noted.
Potential for vendor lock-in if exclusion criteria were overly restrictive.
Transparency of the 'exclusion of sources' justification is critical.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $4.8 million to KNOUSE FOODS, INC.. COMMODITIES FOR USG FOOD DONATIONS: 2000009646/4100028648/APPLE SLICES CAN-6/10,APPLESAUCE UNSWEETENED CAN-6/10

Who is the contractor on this award?

The obligated recipient is KNOUSE 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 $4.8 million.

What is the period of performance?

Start: 2023-11-16. End: 2024-03-31.

What was the rationale for excluding certain sources prior to the 'full and open' competition phase?

The rationale for excluding sources prior to the 'full and open' competition phase is not detailed in the provided data. Typically, such exclusions are based on specific technical requirements, past performance issues, or unique capabilities needed for the contract. A thorough review of the solicitation documents and award justification would be necessary to understand the specific reasons.

How does the unit cost of these canned apple products compare to market benchmarks for similar government or commercial procurements?

The provided data does not include specific unit costs or sufficient detail to perform a direct market benchmark comparison. While the total contract value is $4.8M for 200,000 units (implied by the 'no': 8, likely referring to cases or pallets), without knowing the exact quantity per unit and comparing it to recent government or commercial contracts for similar canned goods, a precise assessment of value for money is difficult.

What is the long-term impact of this procurement strategy on the availability and cost of food for donation programs?

The long-term impact depends on the sustainability of the competition method and the performance of the awarded vendor. If the limited competition leads to consistently higher prices or reduced vendor pool over time, it could negatively affect the volume of food donations. Conversely, a reliable vendor providing quality products at a fair price supports program continuity.

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: 123J1424B0024

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 800 PEACH GLEN IDAVILLE RD, PEACH GLEN, PA, 17375

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Agricultural Cooperative, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $4,848,738

Exercised Options: $4,848,738

Current Obligation: $4,848,738

Actual Outlays: $4,845,314

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline