Department of Defense awards $185M+ warehousing contract to Al Raha Group for Technical Services

Contract Overview

Contract Amount: $185,128,691 ($185.1M)

Contractor: AL Raha Group for Technical S Ervices

Awarding Agency: Department of Defense

Start Date: 2014-06-05

End Date: 2017-09-04

Contract Duration: 1,187 days

Daily Burn Rate: $156.0K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: IGF::OT::IGF DEPOT PRIME VENDOR SUPPORT CONTRACT

Plain-Language Summary

Department of Defense obligated $185.1 million to AL RAHA GROUP FOR TECHNICAL S ERVICES for work described as: IGF::OT::IGF DEPOT PRIME VENDOR SUPPORT CONTRACT Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Firm Fixed Price contract type suggests cost certainty for the government. 3. Long duration of 1187 days indicates a significant, ongoing need. 4. The contract falls under General Warehousing and Storage, a critical logistics function. 5. No small business set-aside was applied, potentially limiting opportunities for smaller firms.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging due to the lack of publicly available comparable sole-source warehousing contracts of similar scale and duration. The firm fixed price structure provides some cost control, but the absence of competition means the government may not have secured the lowest possible price. Without more data on the specific services rendered and market rates for similar logistics support in the region, a definitive value-for-money assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This significantly limits the opportunity for price discovery and potentially leads to higher costs for the government compared to a fully competed contract. The rationale for the sole-source award is not detailed in the provided data, but it suggests a specific capability or circumstance that precluded open competition.

Taxpayer Impact: Taxpayers may have paid a premium due to the lack of competitive bidding. The absence of multiple offers means the government could not leverage market forces to drive down costs.

Public Impact

The primary beneficiaries are the Department of Defense units relying on efficient warehousing and storage services. Services delivered include general warehousing and storage, crucial for maintaining operational readiness. The geographic impact is likely concentrated in the region where Al Raha Group operates, supporting military logistics. Workforce implications may include employment opportunities for personnel involved in warehousing and logistics operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potential cost savings.
Lack of transparency regarding the justification for sole-source award.
Potential for higher costs due to absence of market competition.

Positive Signals

Firm Fixed Price contract provides cost certainty once awarded.
Long contract duration suggests a sustained need and potential for stable service delivery.

Sector Analysis

The General Warehousing and Storage sector (NAICS 493110) is a vital component of the logistics and supply chain industry. This contract represents a significant expenditure within this sector for the Department of Defense. Comparable spending benchmarks for large-scale, long-term warehousing contracts within the defense sector are often substantial, reflecting the critical nature of these services for military operations.

Small Business Impact

The contract data indicates that this was not a small business set-aside, nor does it appear to involve significant subcontracting to small businesses based on the provided information. This means that opportunities for small businesses to participate in this specific contract were likely limited. The absence of a small business focus in this large award could impact the overall distribution of federal contracting dollars to the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contract management and oversight mechanisms, potentially involving the Defense Contract Management Agency (DCMA) for performance monitoring. Accountability measures are inherent in the firm fixed price structure, but the sole-source nature necessitates robust oversight to ensure fair pricing and adequate performance. Transparency is limited by the sole-source award, with further details on oversight and accountability likely residing within internal DoD reporting structures.

Related Government Programs

Defense Logistics Agency Contracts
General Services Administration (GSA) Schedules for Warehousing
Department of Defense Supply Chain Management

Risk Flags

Sole-source award may lead to higher costs.
Lack of competition limits price discovery.
Limited transparency on award justification.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $185.1 million to AL RAHA GROUP FOR TECHNICAL S ERVICES. IGF::OT::IGF DEPOT PRIME VENDOR SUPPORT CONTRACT

Who is the contractor on this award?

The obligated recipient is AL RAHA GROUP FOR TECHNICAL S ERVICES.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $185.1 million.

What is the period of performance?

Start: 2014-06-05. End: 2017-09-04.

What specific warehousing and storage services are included under this contract?

The provided data classifies this contract under NAICS code 493110, 'General Warehousing and Storage.' This typically encompasses services such as storing goods, operating distribution centers, and managing inventory. Specific services could include receiving, storing, inventory management, order fulfillment, and shipping of various materials and equipment for the Department of Defense. The exact scope would be detailed in the contract's statement of work, which is not publicly available in this data extract. These services are critical for maintaining the readiness and operational capability of military forces by ensuring timely access to necessary supplies and equipment.

What is the justification for this contract being awarded on a sole-source basis?

The provided data explicitly states the contract was 'NOT AVAILABLE FOR COMPETITION,' indicating a sole-source award. The specific justification for this sole-source determination is not included in the data. Common reasons for sole-source awards include unique capabilities possessed by only one contractor, urgent and compelling needs where competition is impractical, or when a specific item of supply is available only from a single source. Without further documentation from the Department of Defense, the precise rationale remains unknown. This lack of competition limits the government's ability to secure the best possible pricing through market forces.

How does the firm fixed price (FFP) contract type impact cost control for this warehousing service?

A Firm Fixed Price (FFP) contract type is generally favorable for cost control when the scope of work is well-defined and risks are understood. Under an FFP contract, the contractor agrees to a set price for the specified goods or services, and the government pays that amount regardless of the contractor's actual costs. This shifts the risk of cost overruns to the contractor. For warehousing services, an FFP contract provides budget certainty for the Department of Defense. However, because this contract was awarded sole-source, the initial fixed price may not have been as aggressively negotiated as it would have been in a competitive environment, potentially impacting the overall value achieved.

What is the typical duration for similar large-scale warehousing contracts within the Department of Defense?

The duration of this contract is 1187 days, which is approximately 3.25 years. Large-scale warehousing and logistics support contracts within the Department of Defense can vary significantly in duration, often ranging from one to five years, with options for extension. Contracts with longer durations, like this one, typically indicate a stable, long-term requirement for essential services. The length suggests a significant operational need that the Department of Defense intends to fulfill consistently. Shorter durations might be used for more project-specific or temporary needs, while longer ones are common for ongoing base support or critical supply chain functions.

Are there any indications of performance issues or contractor track record concerns based on the provided data?

The provided data extract does not contain specific information regarding the contractor's track record, past performance ratings, or any documented performance issues related to this particular contract or the contractor, Al Raha Group for Technical Services. The data focuses on contract award details such as value, dates, type, and parties involved. A comprehensive assessment of the contractor's track record would require access to performance reports, past performance evaluations, and potentially contract modification histories, which are not included here. Therefore, based solely on this data, no performance concerns can be identified or ruled out.

Industry Classification

NAICS: Transportation and Warehousing › Warehousing and Storage › General Warehousing and Storage

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: BUILDING 40 PRINCE FAWWAZ BIN, RIYADH

Business Categories: Category Business, Foreign Owned, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations

Financial Breakdown

Contract Ceiling: $185,128,691

Exercised Options: $185,128,691

Current Obligation: $185,128,691

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA850514D0004

IDV Type: IDC

Timeline