HHS awards $43M for face coverings to Beverly Knits Inc. amid pandemic
Contract Overview
Contract Amount: $42,970,975 ($43.0M)
Contractor: Beverly Knits Inc
Awarding Agency: Department of Health and Human Services
Start Date: 2020-04-02
End Date: 2020-08-31
Contract Duration: 151 days
Daily Burn Rate: $284.6K/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: BEVERLY KNITS INC. CLOTH FACE COVERINGS
Place of Performance
Location: GASTONIA, GASTON County, NORTH CAROLINA, 28052
Plain-Language Summary
Department of Health and Human Services obligated $43.0 million to BEVERLY KNITS INC for work described as: BEVERLY KNITS INC. CLOTH FACE COVERINGS Key points: 1. Significant award value highlights demand for PPE during COVID-19. 2. Beverly Knits Inc. secured a large contract, indicating potential market concentration. 3. Risk of supply chain disruption and quality control for essential goods. 4. Sector: Other Cut and Sew Apparel Manufacturing, crucial for public health.
Value Assessment
Rating: good
The contract value of $42.97M for face coverings appears reasonable given the urgent demand during the COVID-19 pandemic. Benchmarking against similar emergency procurements for PPE would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' suggesting a limited initial competition. This method may have impacted price discovery, potentially leading to higher costs than a fully open process.
Taxpayer Impact: Taxpayers bore the cost of this significant award, which was necessary for public health response. The efficiency of the procurement process impacts the overall value for taxpayer money.
Public Impact
Ensured supply of critical personal protective equipment (PPE) during a national health crisis. Supported domestic manufacturing capabilities for essential goods. Potential for price fluctuations due to urgent, high-demand procurement.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition may have inflated prices.
- Reliance on a single supplier for critical goods.
- Potential quality control issues with mass-produced PPE.
Positive Signals
- Rapid procurement to meet urgent needs.
- Awarded to a domestic manufacturer.
- Firm fixed price contract provides cost certainty.
Sector Analysis
The 'Other Cut and Sew Apparel Manufacturing' sector saw a surge in demand for PPE during the pandemic. This award represents a substantial portion of spending within this niche during a critical period.
Small Business Impact
Beverly Knits Inc. is not listed as a small business in this award. The contract did not appear to prioritize small business participation.
Oversight & Accountability
The contract was awarded by the Department of Health and Human Services, Office of Assistant Secretary for Preparedness and Response, indicating agency oversight. Further review of performance reports and audits would be needed to assess accountability.
Related Government Programs
- Other Cut and Sew Apparel Manufacturing
- Department of Health and Human Services Contracting
- Office of Assistant Secretary for Preparedness and Response Programs
Risk Flags
- Potential for price inflation due to limited competition.
- Supply chain vulnerability if Beverly Knits Inc. faced production issues.
- Ensuring consistent quality across a large volume of products.
- Lack of small business participation.
Tags
other-cut-and-sew-apparel-manufacturing, department-of-health-and-human-services, nc, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Health and Human Services awarded $43.0 million to BEVERLY KNITS INC. BEVERLY KNITS INC. CLOTH FACE COVERINGS
Who is the contractor on this award?
The obligated recipient is BEVERLY KNITS INC.
Which agency awarded this contract?
Awarding agency: Department of Health and Human Services (Office of Assistant Secretary for Preparedness and Response).
What is the total obligated amount?
The obligated amount is $43.0 million.
What is the period of performance?
Start: 2020-04-02. End: 2020-08-31.
Was the limited competition truly justified by the urgency, or did it represent a missed opportunity for better pricing?
The justification for limited competition often stems from urgent, unforeseen needs, as was the case with the COVID-19 pandemic. While it can expedite delivery, it may forgo the potential cost savings and broader market engagement offered by full and open competition. A post-award analysis of market conditions and alternative bids could reveal if better pricing was achievable.
What were the specific quality control measures in place to ensure the effectiveness of these face coverings?
Ensuring the quality and effectiveness of mass-produced PPE during a pandemic is critical. Specific measures would typically include adherence to relevant standards (e.g., CDC guidelines), manufacturer quality control plans, and potentially government inspections or third-party testing. The contract details should outline these requirements and the process for verifying compliance.
How did the firm fixed price contract impact the government's ability to adjust to potential changes in material costs or production efficiencies?
A firm fixed price contract offers the government cost certainty, as the price is set regardless of the contractor's actual costs. However, it places the risk of cost overruns on the contractor. This structure can incentivize efficiency but may limit the government's ability to benefit from unexpected cost reductions or to adjust the price if unforeseen circumstances significantly impact production.
Industry Classification
NAICS: Manufacturing › Cut and Sew Apparel Manufacturing › Other Cut and Sew Apparel Manufacturing
Product/Service Code: MEDICAL/DENTAL/VETERINARY EQPT/SUPP
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 8
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1675 GARFIELD DR, GASTONIA, NC, 28052
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $42,970,975
Exercised Options: $42,970,975
Current Obligation: $42,970,975
Actual Outlays: $42,970,975
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2020-04-02
Current End Date: 2020-08-31
Potential End Date: 2020-08-31 00:00:00
Last Modified: 2022-10-24
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