DoD's $11.7M Grocery Resale Contract with Conagra Foods Lacked Competition, Raising Value Concerns
Contract Overview
Contract Amount: $11,690,742 ($11.7M)
Contractor: Conagra Foods Packaged Foods C
Awarding Agency: Department of Defense
Start Date: 2008-02-01
End Date: 2008-03-31
Contract Duration: 59 days
Daily Burn Rate: $198.1K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIXED PRICE
Sector: Other
Official Description: RESALE - ASSORTED GROCERY
Place of Performance
Location: OMAHA, DOUGLAS County, NEBRASKA, 68102
State: Nebraska Government Spending
Plain-Language Summary
Department of Defense obligated $11.7 million to CONAGRA FOODS PACKAGED FOODS C for work described as: RESALE - ASSORTED GROCERY Key points: 1. Significant spending on assorted groceries highlights reliance on established suppliers. 2. Lack of competition for this large contract warrants scrutiny of pricing and value. 3. The fixed-price contract type offers some cost certainty but limits potential savings. 4. Defense Commissary Agency's spending in this sector is substantial, impacting military families.
Value Assessment
Rating: questionable
The contract value of $11.7M for assorted groceries is substantial. Without competitive bidding, it's difficult to benchmark against similar contracts or market prices to ensure optimal value for taxpayer dollars.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not available for competition, suggesting a sole-source or limited-source award. This significantly impacts price discovery, as there was no market pressure to drive down costs.
Taxpayer Impact: The absence of competition likely resulted in higher prices than could have been achieved through a competitive process, impacting taxpayer funds.
Public Impact
Military families and personnel benefit from access to groceries through the Defense Commissary Agency. The contract ensures the availability of essential food items for service members and their families. Spending on food supplies is a critical component of military welfare and readiness. The long-term implications of non-competitive awards on overall food procurement costs are a concern.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Potential for overpayment
- Limited transparency in pricing
Positive Signals
- Ensures supply of essential goods
- Fixed-price contract provides cost predictability
Sector Analysis
The Defense Commissary Agency procures a wide range of food products to support military personnel and their families. Spending benchmarks in this sector are often influenced by large-scale contracts and the unique logistical challenges of military supply chains.
Small Business Impact
The data does not indicate any specific provisions or awards made to small businesses under this contract. Further analysis would be needed to determine small business participation.
Oversight & Accountability
The lack of competition raises questions about the oversight processes that led to this award. Robust oversight is crucial to ensure fair pricing and maximize value, especially in non-competitive situations.
Related Government Programs
- General Line Grocery Merchant Wholesalers
- Department of Defense Contracting
- Defense Commissary Agency Programs
Risk Flags
- Lack of competition
- Potential for inflated pricing
- Limited transparency in award justification
- No clear small business participation
Tags
general-line-grocery-merchant-wholesaler, department-of-defense, ne, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $11.7 million to CONAGRA FOODS PACKAGED FOODS C. RESALE - ASSORTED GROCERY
Who is the contractor on this award?
The obligated recipient is CONAGRA FOODS PACKAGED FOODS C.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Commissary Agency).
What is the total obligated amount?
The obligated amount is $11.7 million.
What is the period of performance?
Start: 2008-02-01. End: 2008-03-31.
What was the justification for awarding this contract without competition, and how was the price determined to be fair and reasonable?
The justification for awarding the contract without competition is not provided in the data. Typically, such decisions require a formal justification, such as the existence of a unique capability or urgent need. Without this information, it's impossible to assess the price reasonableness, as there was no competitive market to establish a benchmark.
What is the potential financial risk to taxpayers due to the lack of competitive bidding on this $11.7M grocery contract?
The primary financial risk to taxpayers stems from the potential for paying above-market prices. Without competition, the contractor may not have had the incentive to offer the lowest possible price. This could lead to millions in potential overspending compared to what could have been achieved through a competitive solicitation.
How does the fixed-price contract type impact the effectiveness of this grocery resale procurement, given the lack of competition?
A fixed-price contract provides cost certainty for the government, meaning the price is set upfront. However, in the absence of competition, the effectiveness in achieving the best value is diminished. While the government knows the cost, it doesn't guarantee it's the most economical price achievable, potentially limiting the overall effectiveness of the procurement in terms of cost savings.
Industry Classification
NAICS: Wholesale Trade › Grocery and Related Product Merchant Wholesalers › General Line Grocery Merchant Wholesalers
Product/Service Code: SUBSISTENCE
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1 CONAGRA DR, OMAHA, NE, 68102
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $20,000,000
Exercised Options: $11,690,742
Current Obligation: $11,690,742
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: HDEC0105G3356
IDV Type: IDC
Timeline
Start Date: 2008-02-01
Current End Date: 2008-03-31
Potential End Date: 2010-12-31 00:00:00
Last Modified: 2019-06-07
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