DOJ's $32.8K milk purchase for prisons highlights niche supply chain needs

Contract Overview

Contract Amount: $32,752 ($32.8K)

Contractor: Larc Industries Inc

Awarding Agency: Department of Justice

Start Date: 2026-01-04

End Date: 2026-04-04

Contract Duration: 90 days

Daily Burn Rate: $364/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: LARC INDUSTRIES 2ND QTR. FY26 MILK

Place of Performance

Location: COLLEGEVILLE, MONTGOMERY County, PENNSYLVANIA, 19426

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Justice obligated $32,751.94 to LARC INDUSTRIES INC for work described as: LARC INDUSTRIES 2ND QTR. FY26 MILK Key points: 1. Value for money appears reasonable given the specialized nature of dairy supply for correctional facilities. 2. Competition dynamics indicate a limited but potentially effective procurement process for this specific need. 3. Risk indicators are low due to the short duration and straightforward nature of the product. 4. Performance context suggests a routine operational requirement for inmate sustenance. 5. Sector positioning places this within the essential services category for federal institutions.

Value Assessment

Rating: good

The contract value of $32,751.94 for a 90-day milk supply is difficult to benchmark precisely without more granular data on dairy pricing in specific correctional settings. However, considering the logistical complexities of delivering perishable goods to federal prisons, the price appears to be within a reasonable range for ensuring consistent supply. The firm fixed-price structure helps manage cost certainty for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

This contract was competed under Simplified Acquisition Procedures (SAP), suggesting a procurement valued below the threshold for full and open competition. While the specific number of bidders is not detailed, SAP typically involves a limited number of quotes or proposals. This approach is suitable for smaller value procurements where extensive competition may not be cost-effective or feasible.

Taxpayer Impact: For taxpayers, SAP aims to balance efficient procurement with fair pricing. While not as competitive as full and open, it allows for quicker acquisition of necessary goods and services, potentially at a fair market price, avoiding the administrative overhead of larger-scale competitions.

Public Impact

Inmates within the Federal Prison System will benefit from a consistent supply of fresh milk. Essential nutritional services are delivered through this procurement. The geographic impact is localized to the specific federal correctional facility receiving the milk. Workforce implications are minimal, primarily involving the delivery personnel from the supplier.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations in dairy markets impacting future procurements.
Dependence on a single supplier for a critical perishable good.

Positive Signals

Firm fixed-price contract provides cost certainty for the current period.
Short contract duration limits long-term exposure to market volatility.
Procurement under SAP is designed for efficiency in acquiring essential goods.

Sector Analysis

The dairy wholesale market is a mature sector characterized by established distribution networks. Federal agencies, particularly those operating large institutions like prisons, represent a consistent demand for perishable goods. This contract fits within the broader category of food and beverage procurement for government facilities, where reliability and timely delivery are paramount. Comparable spending benchmarks for institutional dairy supply can vary significantly based on location and volume.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses, nor does it appear to involve significant subcontracting opportunities for them. The primary contractor, LARC INDUSTRIES INC, is likely a medium to large enterprise given the nature of wholesale distribution. Further analysis would be needed to determine if any small businesses are part of LARC's supply chain for this contract.

Oversight & Accountability

Oversight for this purchase order would typically fall under the Bureau of Prisons' contracting and financial management divisions. Accountability is ensured through the terms of the purchase order, including delivery schedules and product specifications. Transparency is facilitated by the public availability of contract data, allowing for scrutiny of spending.

Related Government Programs

Federal Prison System Food Services
Department of Justice Commissary Operations
Commodity Procurement for Federal Institutions

Risk Flags

Perishable Goods Logistics
Supply Chain Reliability
Price Volatility (Dairy Market)

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $32,751.94 to LARC INDUSTRIES INC. LARC INDUSTRIES 2ND QTR. FY26 MILK

Who is the contractor on this award?

The obligated recipient is LARC INDUSTRIES INC.

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Prison System / Bureau of Prisons).

What is the total obligated amount?

The obligated amount is $32,751.94.

What is the period of performance?

Start: 2026-01-04. End: 2026-04-04.

What is the track record of LARC INDUSTRIES INC with the federal government, specifically the Department of Justice?

A review of federal procurement data indicates that LARC INDUSTRIES INC has a history of receiving contracts and purchase orders from various federal agencies. For the Department of Justice, specifically the Bureau of Prisons, LARC INDUSTRIES INC has been awarded contracts for dairy products and other food supplies. The frequency and value of these awards suggest a recognized capability in meeting the logistical and product requirements of correctional facilities. Analyzing past performance reviews and any documented issues or commendations associated with LARC INDUSTRIES INC's previous federal awards would provide a more comprehensive understanding of their reliability and performance history. Without specific past performance ratings for this particular contract vehicle or similar ones, it's challenging to definitively assess their track record beyond their presence in the federal marketplace.

How does the price per unit of milk in this contract compare to similar federal or state correctional facility contracts?

Directly comparing the per-unit cost of milk for this $32,751.94 contract (90-day duration) is challenging without knowing the exact volume (gallons or liters) purchased. However, assuming a standard institutional volume, the price would need to be benchmarked against other correctional system dairy procurements. Federal Prison System (FPS) contracts, and state-level equivalents, often negotiate bulk pricing. Factors like delivery location, frequency, and specific product type (e.g., whole, skim, 2%, fortified) significantly influence per-unit costs. Generally, larger, longer-term contracts with guaranteed volumes tend to achieve lower per-unit prices due to economies of scale and supplier commitment. This contract's 'limited' competition under SAP might suggest a price that is fair but potentially not the absolute lowest achievable through a broader, more competitive bidding process.

What are the primary risks associated with this specific milk procurement contract?

The primary risks associated with this milk procurement contract are related to the perishable nature of the product and the potential for supply chain disruptions. If LARC INDUSTRIES INC experiences issues with their dairy suppliers, transportation, or internal operations, it could lead to shortages or delays in delivery, impacting the daily operations and inmate welfare at the federal prison. Price volatility in the dairy market presents another risk, although the firm fixed-price nature of this 90-day contract mitigates this for the current period. However, future renewals could be subject to increased costs. Additionally, ensuring consistent quality and adherence to specific nutritional standards required by the Bureau of Prisons is crucial; any deviation could lead to contract disputes or require corrective actions. The limited competition aspect, while efficient for this value, could also pose a risk if the chosen supplier underperforms and replacement options are scarce.

How effective is the Simplified Acquisition Procedure (SAP) in ensuring value for money for routine operational needs like dairy supply?

Simplified Acquisition Procedures (SAP) are designed to streamline the procurement of goods and services below certain dollar thresholds (currently $250,000), making them generally effective for routine operational needs like dairy supply. SAP balances the need for speed and reduced administrative burden with the requirement for fair and reasonable pricing. By allowing for fewer formal requirements and potentially fewer bidders, it can expedite the acquisition process, which is critical for perishable items. While SAP may not always yield the absolute lowest price achievable through full and open competition, it often provides a good balance of cost, speed, and quality for smaller-value procurements. The effectiveness hinges on the agency's diligence in obtaining competitive quotes from qualified vendors and ensuring the price is fair market value, which is a standard requirement even under SAP.

What are the historical spending patterns for dairy products by the Federal Prison System?

Historical spending patterns for dairy products by the Federal Prison System (FPS) reveal a consistent and significant demand driven by the need to provide daily nutrition to a large inmate population across numerous facilities nationwide. The FPS procures substantial quantities of milk, cheese, butter, and other dairy items regularly. Spending typically occurs through a combination of competitively bid large-scale contracts, often awarded to major food service distributors, and smaller, localized purchase orders or simplified acquisitions for specific facilities or immediate needs, similar to the LARC INDUSTRIES contract. Annual spending on dairy products for the entire FPS likely runs into the tens of millions of dollars, varying based on inmate population levels, commodity prices, and contract vehicles in place. Analyzing historical data would show trends in pricing, supplier diversity, and the prevalence of different procurement methods used by the FPS for these essential food items.

Industry Classification

NAICS: Wholesale Trade › Grocery and Related Product Merchant Wholesalers › Dairy Product (except Dried or Canned) Merchant Wholesalers

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 15B50526Q00000004

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1514 GREEN VALLEY DR, COLLEGEVILLE, PA, 19426

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business

Financial Breakdown

Contract Ceiling: $32,752

Exercised Options: $32,752

Current Obligation: $32,752

Actual Outlays: $15,116

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline