Department of the Army awarded $29.8M contract for convoy escort services to Olive Group North America, LLC

Contract Overview

Contract Amount: $29,825,580 ($29.8M)

Contractor: Olive Group North America, LLC

Awarding Agency: Department of Defense

Start Date: 2011-07-08

End Date: 2012-06-30

Contract Duration: 358 days

Daily Burn Rate: $83.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: CONVOY ESCORT TEAMS FOR 1TSC.

Plain-Language Summary

Department of Defense obligated $29.8 million to OLIVE GROUP NORTH AMERICA, LLC for work described as: CONVOY ESCORT TEAMS FOR 1TSC. Key points: 1. Contract value of $29.8M for a 12-month period suggests a significant operational requirement. 2. Full and open competition indicates a broad market search, potentially leading to competitive pricing. 3. The contract's fixed-price nature shifts performance risk to the contractor. 4. Security guard services (NAICS 561612) are a common requirement across various government operations. 5. The award was a delivery order, implying it was part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract or a similar framework. 6. The duration of 358 days aligns with the specified end date, indicating timely execution.

Value Assessment

Rating: good

The contract value of approximately $29.8 million for a 12-month period for convoy escort services appears reasonable given the nature of security operations. Benchmarking against similar contracts for security guard and patrol services (NAICS 561612) would provide a more precise value-for-money assessment. However, the fixed-price contract type suggests that the contractor bears the risk of cost overruns, which can incentivize efficiency. The number of bids received (2) is on the lower side for full and open competition, which might warrant further investigation into pricing competitiveness.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. While the data indicates two bids were received, the specific details of the solicitation and the evaluation process are not provided. A low number of bids in a full and open competition could suggest potential issues with market awareness, solicitation clarity, or the attractiveness of the contract terms to a wider range of potential bidders. However, it does not inherently mean the competition was flawed.

Taxpayer Impact: Full and open competition is generally favorable for taxpayers as it aims to maximize the pool of potential offerors, thereby fostering a more competitive environment that can drive down prices and improve service quality.

Public Impact

The primary beneficiaries are the military personnel and assets requiring secure transportation and escort services in operational areas. The contract delivers essential security services to support the 1st Theater Sustainment Command (1TSC) operations. Geographic impact is likely concentrated in areas where the 1st TSC operates, which can include regions in the Middle East and other operational theaters. Workforce implications include the direct employment of security personnel by Olive Group North America, LLC, and potentially indirect employment through subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited number of bids (2) received under full and open competition may indicate potential challenges in attracting a broader range of qualified contractors or issues with the solicitation itself.
Lack of detailed performance metrics or quality assurance data in the provided summary makes it difficult to assess the contractor's actual performance beyond contract completion.

Positive Signals

Awarding under full and open competition suggests an effort to ensure a fair and transparent procurement process.
The firm-fixed-price contract type transfers cost risk to the contractor, potentially leading to greater cost certainty for the government.
The contract was awarded to Olive Group North America, LLC, a known entity in the security services sector.

Sector Analysis

The security and guard services sector (NAICS 561612) is a significant market supporting government operations, particularly in defense and logistics. This contract for convoy escort teams falls within the broader defense logistics and security services industry. Comparable spending benchmarks for similar security contracts can vary widely based on geographic location, threat levels, and specific service requirements. The total award of $29.8 million over approximately one year indicates a substantial contract within this specialized service area.

Small Business Impact

The provided data indicates that small business set-aside was not utilized (ss: false) and there is no information on subcontracting plans (sb: false, st: ''). This suggests that the contract was not specifically targeted towards small businesses, and there is no explicit indication of requirements for small business subcontracting. Therefore, the direct impact on the small business ecosystem through this specific contract is likely minimal, unless the prime contractor voluntarily engages small businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within the Department of the Army. Accountability measures would be embedded in the contract terms, including performance standards and payment schedules. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply if any allegations of fraud, waste, or abuse arise during the contract's performance or closeout.

Related Government Programs

Logistics Support Services
Security Services
Convoy Operations
Theater Support Contracts
Department of Defense Procurement

Risk Flags

Limited Competition (2 Bidders)
Potential for High-Risk Operational Environment

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $29.8 million to OLIVE GROUP NORTH AMERICA, LLC. CONVOY ESCORT TEAMS FOR 1TSC.

Who is the contractor on this award?

The obligated recipient is OLIVE GROUP NORTH AMERICA, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $29.8 million.

What is the period of performance?

Start: 2011-07-08. End: 2012-06-30.

What is the track record of Olive Group North America, LLC in performing similar government contracts, particularly those involving convoy escort services?

Olive Group North America, LLC has a history of performing security and logistics support contracts for the U.S. government, often in complex operational environments. While specific details on their track record for convoy escort services in this particular theater are not fully detailed in the summary data, their presence suggests experience in this domain. A deeper dive into their past performance evaluations, contract history (including any awards or terminations for default), and client feedback would be necessary for a comprehensive assessment. Their ability to secure this contract, especially if it was competed, implies they met the minimum qualifications and demonstrated capability to the contracting agency. However, without access to detailed performance reports, it's difficult to definitively gauge their past success rate and reliability for this specific type of high-risk service.

How does the awarded amount of $29.8 million compare to the market rates for similar convoy escort services in the relevant operational areas?

The awarded amount of $29.8 million for approximately one year of convoy escort services represents a significant investment. To benchmark this value, one would need to compare it against similar contracts awarded by the Department of Defense or other agencies for comparable services in similar geographic regions and threat environments. Factors such as the number of personnel, types of vehicles, security equipment, duration of escorts, and specific operational tempo heavily influence pricing. Given that this was a delivery order under full and open competition, the price should theoretically reflect market conditions. However, the limited number of bids (two) might suggest that the pricing could be higher than if there had been more robust competition. A detailed cost analysis comparing labor rates, overhead, profit margins, and material costs against industry standards and other government contracts would be required for a definitive value assessment.

What are the primary risks associated with this contract, and how are they being mitigated?

The primary risks associated with this contract include operational risks (e.g., security incidents, vehicle accidents, personnel safety in hostile environments), performance risks (e.g., failure to provide adequate escort, delays, contractor personnel misconduct), and financial risks (e.g., cost overruns for the contractor, though mitigated by fixed-price). Mitigation strategies typically involve rigorous contractor vetting, adherence to strict security protocols and rules of engagement, robust communication systems, contingency planning, and performance monitoring by the government. The firm-fixed-price contract shifts some financial risk to the contractor. Additionally, the government's oversight through a COR and potential for contract modifications or termination for default serve as further risk mitigation tools.

What is the expected effectiveness of the convoy escort services provided under this contract in supporting the 1st TSC's mission?

The effectiveness of the convoy escort services is crucial for ensuring the safe and timely movement of personnel, equipment, and supplies critical to the 1st Theater Sustainment Command's mission. By providing security and mitigating threats along transportation routes, these services directly contribute to operational readiness and mission accomplishment. The contract's success hinges on the contractor's ability to maintain a high level of vigilance, respond effectively to threats, and operate within established rules of engagement. While the contract value and duration suggest a substantial requirement, the ultimate effectiveness will be measured by the reduction in security incidents, the reliability of logistical movements, and the overall contribution to the 1st TSC's operational tempo and success in its area of responsibility.

How has federal spending on security guard and patrol services (NAICS 561612) trended over the past five years, and where does this contract fit within that trend?

Federal spending on security guard and patrol services (NAICS 561612) has generally remained substantial, reflecting ongoing security needs across various government agencies, particularly the Department of Defense. While specific year-over-year trends require detailed analysis of historical spending data (e.g., from FPDS), such services are consistently in demand for protecting federal facilities, personnel, and assets, especially in high-risk environments. This $29.8 million contract for convoy escort services represents a significant, but likely not anomalous, expenditure within this category. Its placement within the broader spending trend would depend on whether overall federal spending on such services has been increasing, decreasing, or remaining stable. Contracts of this size are typical for major operational support requirements.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Investigation and Security Services › Security Guards and Patrol Services

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2010 CORPORATE RIDGE STE 700, MCLEAN, VA, 22102

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $29,825,580

Exercised Options: $29,825,580

Current Obligation: $29,825,580

Contract Characteristics

Commercial Item: SERVICES PURSUANT TO FAR 12.102(G)

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W52P1J11D0043

IDV Type: IDC

Timeline