DoD awards $18.2M for soup, with Campbell Soup Company as sole source

Contract Overview

Contract Amount: $18,184,618 ($18.2M)

Contractor: Campbell Soup Company

Awarding Agency: Department of Defense

Start Date: 2009-01-01

End Date: 2009-03-31

Contract Duration: 89 days

Daily Burn Rate: $204.3K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIXED PRICE

Sector: Other

Official Description: RESALE - SOUPS (SECTION A)

Place of Performance

Location: CAMDEN, CAMDEN County, NEW JERSEY, 08103

State: New Jersey Government Spending

Plain-Language Summary

Department of Defense obligated $18.2 million to CAMPBELL SOUP COMPANY for work described as: RESALE - SOUPS (SECTION A) Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Short contract duration of 89 days suggests a specific, immediate need. 3. Fixed-price contract type shifts risk to the contractor. 4. The award was a delivery order, indicating it's part of a larger contract vehicle. 5. No indication of small business participation or set-asides. 6. The award falls under wholesale grocery merchant services.

Value Assessment

Rating: fair

The contract value of $18.2 million for a 89-day period for soup procurement appears high on a per-day basis. Without comparable sole-source contracts for similar quantities and types of soup, it is difficult to definitively benchmark value. However, the lack of competition inherently reduces the likelihood of achieving the best possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis to Campbell Soup Company. This means that the Defense Commissary Agency did not solicit bids from other potential suppliers. While sole-source awards can be justified for unique products or urgent needs, they bypass the competitive process that typically drives down prices.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding, as the agency could not leverage multiple offers to secure the lowest price.

Public Impact

Military personnel and their families stationed at facilities served by the Defense Commissary Agency will benefit from the availability of soup products. The contract ensures the supply of essential food items within commissaries. The geographic impact is primarily within New Jersey, where the contractor is located, and potentially other locations served by the Defense Commissary Agency. The contract supports the operations of Campbell Soup Company and its distribution network.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing.
Lack of transparency in the justification for sole-source award.
Short duration may indicate reactive procurement rather than strategic planning.

Positive Signals

Ensures availability of a specific product for military consumers.
Fixed-price contract provides cost certainty for the agency.

Sector Analysis

The procurement of food items for military commissaries falls within the broader food and beverage wholesale sector. This specific contract is for soup, a common grocery item. The Defense Commissary Agency procures a wide range of goods to support military families. Benchmarking this specific award is challenging without knowing the exact volume and types of soup procured, but the value suggests a significant quantity.

Small Business Impact

There is no indication that this contract included small business set-asides or subcontracting requirements. As a sole-source award to a large corporation, it is unlikely to have directly benefited small businesses through this specific procurement action.

Oversight & Accountability

Oversight for this contract would typically fall under the Defense Commissary Agency's internal procurement regulations and the Department of Defense's Inspector General. Transparency is limited due to the sole-source nature of the award, making detailed public scrutiny of the justification and pricing more difficult.

Related Government Programs

Defense Commissary Agency Food Procurement
Department of Defense Food Services
Grocery Wholesaling Services

Risk Flags

Sole-source award
Lack of competition
Potentially high unit cost due to lack of competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $18.2 million to CAMPBELL SOUP COMPANY. RESALE - SOUPS (SECTION A)

Who is the contractor on this award?

The obligated recipient is CAMPBELL SOUP COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Commissary Agency).

What is the total obligated amount?

The obligated amount is $18.2 million.

What is the period of performance?

Start: 2009-01-01. End: 2009-03-31.

What was the specific justification for awarding this contract on a sole-source basis to Campbell Soup Company?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source can provide the required supplies or services, such as for proprietary products, urgent and compelling needs where competition is not feasible, or when a specific brand is mandated for compatibility or operational reasons. Without further documentation, the exact rationale remains unclear, but it implies that the Defense Commissary Agency determined that Campbell Soup Company was the only viable option for this particular procurement during the specified period.

How does the $18.2 million value compare to typical annual spending on soup by the Defense Commissary Agency?

The provided data indicates this contract was for a short duration of 89 days (approximately 3 months), with a total value of $18.2 million. This translates to an approximate daily spending rate of $204,487. If this rate were sustained for a full year, it would amount to over $74 million. Without historical spending data specifically for soup procurement by the Defense Commissary Agency, it's difficult to make a direct annual comparison. However, the high daily expenditure suggests this was either a very large quantity order or included premium pricing, potentially due to the sole-source nature or specific product requirements.

What are the potential risks associated with sole-source procurement in this context?

The primary risk associated with sole-source procurement is the lack of price competition, which can lead to higher costs for the government and taxpayers compared to an open bidding process. There's also a reduced incentive for the contractor to offer the most competitive pricing or the highest quality service. Furthermore, it can stifle innovation and limit opportunities for other capable suppliers to enter the market. In this case, the Defense Commissary Agency may have overpaid for the soup products due to the absence of competitive pressure.

What specific types or quantities of soup were procured under this contract?

The provided data does not specify the exact types or quantities of soup procured under this contract. It only indicates the North American Industry Classification System (NAICS) code 424410, which covers 'General Line Grocery Merchant Wholesalers.' This broad classification suggests a range of grocery products could be included, with soup being the focus for this particular award. Understanding the specific SKUs and volumes would be necessary for a more granular analysis of value and appropriateness.

What is the track record of Campbell Soup Company in supplying the Defense Commissary Agency or other government entities?

Campbell Soup Company is a well-established food manufacturer with a long history of supplying consumer goods. While this specific data point pertains to a sole-source delivery order, it is highly probable that Campbell Soup Company has a history of supplying the Defense Commissary Agency and potentially other government entities through various contract vehicles, including competitive ones. Their extensive experience in the food industry suggests a capacity to meet large-scale demands. However, the specifics of their past performance, including any issues or successes with government contracts, would require a deeper dive into federal procurement databases.

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 CAMPBELL PLACE SW4, CAMDEN, NJ, 08103

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $18,184,618

Exercised Options: $18,184,618

Current Obligation: $18,184,618

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HDEC0105G3271

IDV Type: IDC

Timeline