USDA awards $30.4M for managed print and fax services to Xerox, with 8 years of performance

Contract Overview

Contract Amount: $30,386,737 ($30.4M)

Contractor: Xerox Corporation

Awarding Agency: Department of Agriculture

Start Date: 2022-04-25

End Date: 2032-03-31

Contract Duration: 3,628 days

Daily Burn Rate: $8.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: USDA ENTERPRISE-WIDE MANAGED PRINT SERVICES (MPS III) AND ELECTRONIC FAX SERVICES.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20036

State: District of Columbia Government Spending

Plain-Language Summary

Department of Agriculture obligated $30.4 million to XEROX CORPORATION for work described as: USDA ENTERPRISE-WIDE MANAGED PRINT SERVICES (MPS III) AND ELECTRONIC FAX SERVICES. Key points: 1. The contract value represents a significant investment in essential document management infrastructure for the USDA. 2. Competition dynamics for this contract are crucial for ensuring cost-effectiveness and service quality. 3. Performance risk is moderate, given the established nature of managed print services and the contractor's experience. 4. The contract duration of 8 years allows for long-term planning and potential for economies of scale. 5. This spending falls within the broader category of IT and administrative support services for federal agencies. 6. The firm-fixed-price structure aims to provide cost certainty for the government.

Value Assessment

Rating: good

The contract value of $30.4 million over approximately 8 years suggests a substantial but potentially reasonable investment for enterprise-wide managed print and electronic fax services. Benchmarking against similar large-scale managed print services contracts across federal agencies would provide a clearer picture of value for money. The firm-fixed-price nature of the award helps control costs, but ongoing monitoring of service levels and utilization will be key to ensuring continued value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This approach is generally expected to foster competitive pricing and encourage innovation. The presence of two bids suggests a moderate level of competition, which is sufficient to drive some price discovery but could potentially be higher for such a broad service requirement.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of securing competitive pricing and high-quality services, preventing potential overspending associated with less competitive procurement methods.

Public Impact

Federal employees across the USDA will benefit from reliable and efficient document management and communication tools. The contract ensures the continued provision of managed print services, including printing, copying, and scanning, as well as electronic faxing capabilities. Services are likely to be delivered across various USDA locations nationwide, supporting departmental operations. The contract supports jobs within the IT services and office equipment sectors, both at the prime contractor and potentially at subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if service levels or technology become outdated.
Ensuring consistent service quality across all USDA locations and user groups.
Managing the transition and integration of new equipment and services effectively.

Positive Signals

Awarded through full and open competition, suggesting a competitive process.
Firm-fixed-price contract type provides cost certainty.
Contractor (Xerox) has extensive experience in managed print services.
Long contract duration allows for strategic planning and potential volume discounts.

Sector Analysis

Managed Print Services (MPS) is a significant segment within the broader IT services market, focused on optimizing document output and management for organizations. Federal agencies, like the USDA, increasingly rely on MPS providers to reduce costs, improve efficiency, and enhance security in their document workflows. The market is characterized by large, established players offering a range of hardware, software, and services. This contract fits within the government's strategy to consolidate and modernize its IT infrastructure and administrative functions.

Small Business Impact

The data indicates that this contract was not specifically set aside for small businesses (ss: false) and there is no explicit mention of small business subcontracting goals (sb: false). Therefore, the direct impact on small business set-asides appears minimal. However, the prime contractor, Xerox, may engage small businesses as subcontractors for various components of the managed print and fax services, contributing indirectly to the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically reside within the USDA's Office of the Chief Financial Officer (OCFO) and relevant program offices utilizing the services. Accountability measures are embedded in the firm-fixed-price contract terms, requiring Xerox to meet defined service level agreements (SLAs). Transparency is generally maintained through contract award databases and reporting requirements, though specific performance metrics may not always be publicly detailed. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Enterprise IT Services
Document Management Solutions
Office Equipment Procurement
Federal Communication Services
Shared Services Initiatives

Risk Flags

Long contract duration may lead to technology obsolescence.
Potential for cost inefficiencies if service levels are not actively managed.
Dependence on a single vendor for critical document services.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $30.4 million to XEROX CORPORATION. USDA ENTERPRISE-WIDE MANAGED PRINT SERVICES (MPS III) AND ELECTRONIC FAX SERVICES.

Who is the contractor on this award?

The obligated recipient is XEROX CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Office of the Chief Financial Officer).

What is the total obligated amount?

The obligated amount is $30.4 million.

What is the period of performance?

Start: 2022-04-25. End: 2032-03-31.

What is the historical spending trend for managed print and fax services at the USDA prior to this award?

Analyzing historical spending data for similar services at the USDA is crucial for context. Without specific prior contract data, it's difficult to definitively state trends. However, federal agencies have generally been consolidating print environments and moving towards managed services to reduce costs and complexity. If previous spending was fragmented across multiple contracts or internal resources, this $30.4 million award over 8 years (averaging ~$3.8 million annually) could represent either an increase in centralized spending or a more efficient, consolidated approach compared to prior expenditures. A detailed review of past solicitations and awards for MPS and fax services within USDA would reveal if this represents an increase, decrease, or stable level of investment in these capabilities.

How does the per-page cost or total cost of ownership for this contract compare to industry benchmarks for managed print services?

A direct comparison of per-page costs or total cost of ownership (TCO) for this $30.4 million USDA contract against industry benchmarks requires detailed service level agreements (SLAs), device counts, print volumes, and included services (e.g., supplies, maintenance, software). Generally, large enterprise MPS contracts aim for cost savings through volume, standardization, and efficiency gains. If the contract includes a comprehensive suite of services and a large device footprint, the average annual cost of approximately $3.8 million might be competitive. However, without specific metrics like cost per page for different device types (e.g., multifunction devices, printers) and the associated service bundles, a definitive benchmark assessment is challenging. Industry best practices often focus on reducing the number of devices, automating workflows, and optimizing device placement to lower TCO.

What are the specific performance metrics and service level agreements (SLAs) included in this contract, and how are they monitored?

The provided data does not detail the specific performance metrics and Service Level Agreements (SLAs) for the USDA's Managed Print Services (MPS III) and Electronic Fax Services contract. Typically, such contracts include SLAs related to device uptime, response times for maintenance and repair, toner/supply delivery, equipment availability, and potentially document security and environmental compliance. Monitoring these SLAs is usually managed through a combination of contractor-provided reports (e.g., device utilization, service calls, uptime statistics) and government oversight personnel. The USDA's Contracting Officer's Representative (COR) would be responsible for tracking performance against these SLAs and initiating corrective actions if Xerox fails to meet the agreed-upon standards. Failure to meet SLAs could result in financial penalties or other contractual remedies.

What is Xerox Corporation's track record with similar large-scale managed print services contracts within the federal government?

Xerox Corporation has a long-standing and significant presence in providing managed print services (MPS) to the federal government. They have held numerous large contracts with various agencies, including blanket purchase agreements (BPAs) and individual task orders, for printing, copying, scanning, and document management solutions. Their track record generally includes experience managing complex, multi-agency deployments. Success factors often depend on the specific contract scope, agency requirements, and the effectiveness of Xerox's service delivery infrastructure and support teams. While Xerox is a major player, performance can vary based on the specific contract and management. Reviewing past performance evaluations and contract histories for Xerox's federal MPS engagements would provide a more granular understanding of their specific strengths and weaknesses in delivering similar services.

What are the potential risks associated with the 8-year duration of this contract, and what mitigation strategies are in place?

The 8-year duration of this contract presents several potential risks. Firstly, technology in the print and fax industry evolves rapidly; an 8-year commitment could lead to the government being locked into outdated technology or paying above-market rates if newer, more efficient solutions emerge. Secondly, long-term contracts can sometimes reduce the incentive for the contractor to innovate aggressively once the initial performance period is established. Thirdly, changes in agency needs or budget priorities over such a long period could lead to misalignment. Mitigation strategies typically include robust contract clauses for technology refresh, regular performance reviews, options for service adjustments, and clear exit strategies. The firm-fixed-price nature helps manage cost risk, but ensuring flexibility and continuous value requires proactive contract management by the USDA.

How does this contract contribute to the USDA's overall IT modernization and digital transformation goals?

This contract for Managed Print Services (MPS III) and Electronic Fax Services can contribute to the USDA's IT modernization and digital transformation goals by optimizing a critical, yet often overlooked, aspect of digital operations: document management and communication. By consolidating and professionalizing print and fax infrastructure, the USDA can achieve greater efficiency, reduce operational overhead, and potentially improve document security. Modern MPS solutions often integrate with digital workflows, enabling better scanning, routing, and archiving of documents, which aligns with digital transformation objectives. Furthermore, by outsourcing the management of this infrastructure to a specialized provider like Xerox, the USDA can free up internal IT resources to focus on more strategic, mission-critical digital initiatives rather than day-to-day print fleet management.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Photographic and Photocopying Equipment Manufacturing

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - END USER

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 12314422R0003

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1800 M ST NW STE 500N, WASHINGTON, DC, 20036

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $120,367,248

Exercised Options: $44,635,416

Current Obligation: $30,386,737

Actual Outlays: $19,871,614

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS03F137DA

IDV Type: FSS

Timeline