VA awards $2.1M contract for textile linen laundry transportation to 24/7 Enterprises, LLC

Contract Overview

Contract Amount: $2,095,953 ($2.1M)

Contractor: 24/7 Enterprises, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-04-01

End Date: 2027-03-31

Contract Duration: 1,094 days

Daily Burn Rate: $1.9K/day

Competition Type: COMPETED UNDER SAP

Number of Offers Received: 7

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: TEXTILE LINEN LAUNDRY TRANSPORTATION DELIVERY SERVICE

Place of Performance

Location: JAMAICA, QUEENS County, NEW YORK, 11425

State: New York Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $2.1 million to 24/7 ENTERPRISES, LLC for work described as: TEXTILE LINEN LAUNDRY TRANSPORTATION DELIVERY SERVICE Key points: 1. The contract value of $2.1 million over three years suggests a moderate annual spend for essential laundry services. 2. Competition dynamics indicate a 'COMPETED UNDER SAP' award, which may limit broad market participation but can be efficient for smaller procurements. 3. The fixed-price contract type offers cost certainty for the government, shifting performance risk to the contractor. 4. The service area in New York (NY) is clearly defined, potentially limiting the scope of operations and associated transportation costs. 5. The North American Industry Classification System (NAICS) code 484110 points to general freight trucking, local, aligning with the transportation aspect of the service. 6. The award to a single entity, 24/7 Enterprises, LLC, requires scrutiny of their capacity and past performance to ensure service reliability.

Value Assessment

Rating: fair

The contract value of approximately $700,000 annually for laundry transportation services appears within a reasonable range for localized logistics. Benchmarking against similar contracts for textile and linen services, especially those involving transportation, would provide a clearer picture of value for money. Without specific details on the volume of laundry or the exact service area coverage within New York, a precise per-unit cost comparison is difficult. However, the fixed-price nature of the contract suggests the government has negotiated a set rate, which can be advantageous if the contractor can achieve economies of scale.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was competed under SAP (Simplified Acquisition Procedures), which typically involves a less formal solicitation process and may not involve the same level of broad outreach as full and open competition. While the exact number of bidders is not specified, SAP procurements often result in fewer offers than larger, more widely advertised contracts. This can be an efficient method for acquiring goods and services below certain dollar thresholds, but it may limit the potential for discovering the lowest possible price through extensive competition.

Taxpayer Impact: For taxpayers, competing under SAP means that while administrative costs might be lower, there's a potential risk of not achieving the absolute best price compared to a fully competitive bid process. However, for a contract of this size, the efficiency gains of SAP might outweigh the marginal price differences from broader competition.

Public Impact

Veterans and patients within the Department of Veterans Affairs (VA) healthcare facilities in New York will benefit from consistent access to clean linens and textiles. The contract ensures the reliable transportation of laundry to and from VA facilities, supporting the operational continuity of healthcare services. The primary geographic impact is within New York, where the contractor will manage pick-up and delivery routes. The contract supports jobs within the logistics and transportation sector, specifically for 24/7 Enterprises, LLC, and potentially its drivers and support staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition under SAP could potentially lead to higher prices than a fully open solicitation.
Reliance on a single contractor, 24/7 Enterprises, LLC, introduces risk if the company experiences operational disruptions.
The effectiveness of the transportation routes and schedules needs to be monitored to ensure timely delivery and pickup of linens.
Ensuring compliance with all health and safety regulations during transportation of potentially contaminated textiles is crucial.

Positive Signals

The fixed-price contract provides cost predictability for the VA.
The contract duration of three years offers stability in service provision.
The defined service area in New York allows for focused operational planning.
The contractor, 24/7 Enterprises, LLC, is responsible for the logistics, freeing up VA staff.

Sector Analysis

The textile and laundry services sector, particularly for healthcare institutions, is a critical support function. This contract falls within the broader logistics and transportation industry, specifically focusing on local freight services (NAICS 484110). The market for such services is often fragmented, with many local and regional providers. Government contracts in this space are common, ensuring essential services are maintained. Comparable spending benchmarks would typically look at the cost per pound of laundry processed and transported, or per facility serviced, within specific geographic regions.

Small Business Impact

This contract was competed under SAP and does not indicate a specific small business set-aside. The award to 24/7 Enterprises, LLC, does not preclude them from being a small business, but the competition method suggests it was not exclusively targeted towards small businesses. There is no explicit mention of subcontracting requirements, so the impact on the broader small business ecosystem is likely minimal unless 24/7 Enterprises itself utilizes small business subcontractors.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officer and the relevant program officials within the Department of Veterans Affairs. Performance monitoring would likely involve tracking delivery schedules, service quality, and adherence to contract terms. As a purchase order, it falls under the general procurement regulations of the VA. Transparency is facilitated through contract databases, but detailed operational oversight reports are typically internal.

Related Government Programs

Department of Veterans Affairs Healthcare Services
Federal Logistics and Transportation Contracts
Textile and Linen Supply Services
Local Freight and Trucking Services

Risk Flags

Limited Competition
Contractor Performance Risk
Service Disruption Potential

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $2.1 million to 24/7 ENTERPRISES, LLC. TEXTILE LINEN LAUNDRY TRANSPORTATION DELIVERY SERVICE

Who is the contractor on this award?

The obligated recipient is 24/7 ENTERPRISES, LLC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $2.1 million.

What is the period of performance?

Start: 2024-04-01. End: 2027-03-31.

What is the track record of 24/7 Enterprises, LLC with federal contracts, particularly for similar services?

A review of federal contract databases indicates that 24/7 Enterprises, LLC has received federal awards. However, the extent and nature of these prior contracts, especially concerning textile laundry transportation services, require deeper investigation. Analyzing past performance reviews, any documented issues, and the volume of previous federal work would provide crucial insights into their reliability and capability to fulfill this new VA contract. Without specific details on their federal performance history, it's difficult to definitively assess their track record.

How does the annual cost of this contract compare to industry benchmarks for similar laundry transportation services in New York?

The annual cost of approximately $700,000 for textile linen laundry transportation services needs to be benchmarked against regional industry standards. Factors such as the volume of laundry, the number of facilities served, the distance of transportation routes, and the frequency of pickups and deliveries significantly influence pricing. Without these specific operational details, a precise comparison is challenging. However, general industry data for local freight trucking and specialized laundry logistics in the New York metropolitan area can provide a reference point to assess if this contract represents good value for money.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Key risks include potential service disruptions due to contractor performance issues (e.g., equipment failure, labor shortages), unforeseen increases in transportation costs (e.g., fuel price volatility), and compliance failures related to health and safety regulations for handling textiles. Mitigation strategies likely involve robust performance monitoring by the VA, clear contractual remedies for non-performance, and potentially requiring the contractor to maintain backup resources. The fixed-price nature shifts some cost risk to the contractor, but operational risks remain.

How effective is the 'COMPETED UNDER SAP' approach for this type of service, and does it adequately ensure price competition?

Competing under Simplified Acquisition Procedures (SAP) is intended for procurements below certain thresholds, aiming for efficiency and speed. For a contract of $2.1 million, SAP is a permissible method. However, it generally involves fewer bidders and less formal solicitation than full and open competition. While it can be effective for routine services, it may not always yield the most competitive pricing. The effectiveness hinges on whether sufficient interested vendors were aware of and chose to bid, and whether the VA actively sought multiple quotes within the SAP framework.

What is the historical spending pattern for textile linen laundry transportation services by the Department of Veterans Affairs?

Analyzing historical spending for similar services by the VA is crucial for context. This includes examining previous contract values, durations, and awarded contractors for laundry transportation at VA facilities, particularly in the New York region. Understanding if this $2.1 million award represents an increase, decrease, or stable level of spending compared to prior periods can indicate trends in service needs, pricing, or contractor availability. It also helps in assessing whether the current award is consistent with past procurement strategies.

Industry Classification

NAICS: Transportation and Warehousing › General Freight Trucking › General Freight Trucking, Local

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

Competition & Pricing

Extent Competed: COMPETED UNDER SAP

Solicitation Procedures: SIMPLIFIED ACQUISITION

Solicitation ID: 36C24224Q0061

Offers Received: 7

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 50 MILLTOWN RD, BUILDING B, UNION, NJ, 07083

Business Categories: Black American Owned Business, Category Business, DoT Certified Disadvantaged Business Enterprise, Limited Liability Corporation, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $4,123,857

Exercised Options: $2,095,953

Current Obligation: $2,095,953

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Timeline