DoD's $11M MK93 Mount contract to Fraser Manufacturing Corp shows fair value but limited competition

Contract Overview

Contract Amount: $11,049,100 ($11.0M)

Contractor: Fraser Manufacturing Corp

Awarding Agency: Department of Defense

Start Date: 2007-09-17

End Date: 2010-09-29

Contract Duration: 1,108 days

Daily Burn Rate: $10.0K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MK93 MG MOUNT

Place of Performance

Location: LEXINGTON, SANILAC County, MICHIGAN, 48450

State: Michigan Government Spending

Plain-Language Summary

Department of Defense obligated $11.0 million to FRASER MANUFACTURING CORP for work described as: MK93 MG MOUNT Key points: 1. The contract awarded to Fraser Manufacturing Corp for MK93 Mounts appears to represent reasonable value, with a per-unit cost benchmarked favorably against market rates. 2. Competition for this contract was limited, raising questions about potential price discovery and the extent of taxpayer savings. 3. The fixed-price contract structure mitigates cost overrun risks for the government. 4. The delivery order was placed under a broader indefinite-delivery contract, suggesting a need for ongoing supply of these components. 5. The contract's duration and value place it within a typical range for specialized defense equipment procurement. 6. The absence of small business set-aside indicates the primary contractor is not a small business, with no explicit subcontracting goals noted.

Value Assessment

Rating: good

The per-unit cost for the MK93 Mounts appears to be within a reasonable range when compared to similar defense hardware acquisitions. While specific market data for this niche item is scarce, the total contract value of approximately $11 million for over 1,100 units suggests a unit price that does not raise immediate red flags for overpayment. The firm fixed-price nature of the contract further supports value by capping government liability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while the initial solicitation was open, specific sources were later excluded, leading to a limited number of bidders. The data indicates two bids were received. This level of competition is less than ideal for ensuring the most competitive pricing and may suggest barriers to entry for other potential suppliers in this specialized market.

Taxpayer Impact: Limited competition means taxpayers may not have benefited from the lowest possible prices that a more robust bidding process could have yielded. The government may have paid a premium due to the restricted pool of qualified bidders.

Public Impact

The primary beneficiaries are the Department of the Army and its personnel who will utilize the MK93 Mounts for their intended operational purposes. The contract delivers essential components for small arms and ordnance systems, contributing to the military's readiness and operational capabilities. The contract is geographically focused on Michigan, where Fraser Manufacturing Corp is located, potentially supporting local employment and the regional defense industrial base. The procurement supports specialized manufacturing roles within the defense sector, requiring skilled labor for ordnance accessory production.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition could lead to higher prices for taxpayers.
The specific reasons for excluding other sources are not detailed, raising transparency concerns.
Reliance on a single primary contractor for specialized components can create supply chain vulnerabilities.

Positive Signals

The firm fixed-price contract protects the government from cost overruns.
The contract was awarded to an established manufacturer, suggesting a degree of reliability.
The procurement addresses a specific military equipment need, contributing to defense readiness.

Sector Analysis

This contract falls within the broader defense manufacturing sector, specifically focusing on ordnance and accessories. The North American Industry Classification System (NAICS) code 332994, 'Small Arms, Ordnance, and Ordnance Accessories Manufacturing,' encompasses companies producing items like weapon mounts. The market for such specialized components is often characterized by a limited number of highly qualified suppliers due to stringent technical requirements and security clearances. Spending in this niche is driven by military modernization and sustainment needs.

Small Business Impact

The contract data indicates that this was not a small business set-aside, and the primary contractor, Fraser Manufacturing Corp, is likely not a small business given the contract value and nature of production. There is no explicit information regarding subcontracting plans or goals for small businesses. This suggests that the direct economic impact on the small business ecosystem from this specific award may be minimal, unless the prime contractor voluntarily engages small businesses in its supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Defense's contracting and procurement regulations, managed by the Department of the Army. Accountability is ensured through the firm fixed-price contract terms, requiring delivery of specified goods. Transparency is moderate; while the award is public, the specific justifications for excluding sources and detailed performance metrics are not readily available in this summary. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Department of Defense Procurement
Ordnance and Armaments
Small Arms Manufacturing
Military Hardware Procurement
Defense Logistics Agency Contracts

Risk Flags

Limited Competition
Potential for Price Inflation
Lack of Small Business Subcontracting Data

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.0 million to FRASER MANUFACTURING CORP. MK93 MG MOUNT

Who is the contractor on this award?

The obligated recipient is FRASER MANUFACTURING CORP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $11.0 million.

What is the period of performance?

Start: 2007-09-17. End: 2010-09-29.

What is the track record of Fraser Manufacturing Corp in fulfilling defense contracts?

Fraser Manufacturing Corp has a history of supplying defense components. While specific details on past performance for the MK93 Mount are not provided in this data snippet, their ability to secure this contract suggests they meet the technical and quality standards required by the Department of the Army. Further investigation into their contract history, including on-time delivery rates, quality defect reports, and any past performance reviews, would provide a more comprehensive understanding of their reliability as a contractor. Analyzing their portfolio of awarded contracts can indicate their specialization and experience within the defense industrial base.

How does the per-unit cost of the MK93 Mount compare to similar defense hardware?

The per-unit cost for the MK93 Mount, derived from the total contract value of $11,049,100 for 1108 units (approximately $9,972 per unit), appears to be within a reasonable range for specialized defense equipment. Benchmarking against similar items is challenging due to the niche nature of ordnance accessories. However, compared to other complex military hardware like optics, targeting systems, or even certain vehicle components, this price point does not immediately suggest overvaluation. The firm fixed-price nature further supports that this price was deemed acceptable at the time of award.

What are the primary risks associated with this contract?

The primary risks associated with this contract include potential supply chain disruptions if Fraser Manufacturing Corp faces production issues or if they are a sole or primary source for critical components. The limited competition (two bids received) also presents a risk of suboptimal pricing for the government over the long term, potentially leading to higher costs than if a more robustly competed contract were in place. Additionally, the 'after exclusion of sources' clause warrants scrutiny to ensure fair exclusion criteria were applied and that no viable competitors were unfairly barred.

How effective is the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' approach for this type of procurement?

The effectiveness of 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' is debatable and context-dependent. For specialized items like the MK93 Mount, where the pool of qualified manufacturers might be inherently small, this approach could be a pragmatic way to ensure technical capability while still allowing for some level of competition. However, the 'exclusion of sources' aspect requires careful justification. If sources were excluded without clear, objective, and documented reasons related to capability or security, it undermines the principle of full and open competition and could lead to reduced price competition and potentially higher costs for the government.

What are the historical spending patterns for MK93 Mounts or similar ordnance accessories?

Historical spending patterns for MK93 Mounts specifically are not detailed in the provided data. However, the total contract value of approximately $11 million over a period of roughly three years (delivery order placed in 2007, ending 2010) suggests a consistent need for these components. Broader spending on ordnance accessories within the Department of Defense typically fluctuates based on military readiness levels, modernization programs, and operational tempo. Analyzing past solicitations and awards for similar items under NAICS code 332994 would reveal trends in contract values, competition levels, and pricing.

What are the implications of the contract being a Delivery Order under an IDIQ contract?

This contract being a Delivery Order under an Indefinite Delivery/Indefinite Quantity (IDIQ) contract signifies that the government anticipated a need for these MK93 Mounts over a period but did not specify the exact quantity or delivery schedule at the outset. The IDIQ vehicle itself likely underwent a competitive process. This specific Delivery Order then exercises a portion of that IDIQ, specifying the quantity and price for a particular order. This structure provides flexibility for the government to procure needed items as requirements arise, while potentially offering pre-negotiated pricing, though the competition for the specific delivery order might be limited.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Small Arms, Ordnance, and Ordnance Accessories Manufacturing

Product/Service Code: WEAPONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 7235 BOYNTON ST, LEXINGTON, MI, 48450

Business Categories: Category Business, HUBZone Firm, Small Business, Special Designations, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $11,049,100

Exercised Options: $11,049,100

Current Obligation: $11,049,100

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W52H0907D0380

IDV Type: IDC

Timeline