DoD's $132M Software Contract with Softmart Government Services Raises Questions on Value and Competition
Contract Overview
Contract Amount: $132,135,819 ($132.1M)
Contractor: Softmart Government Services, Inc
Awarding Agency: Department of Defense
Start Date: 2006-09-20
End Date: 2009-05-30
Contract Duration: 983 days
Daily Burn Rate: $134.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 9
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: ORDER 21996-C3
Place of Performance
Location: DOWNINGTOWN, CHESTER County, PENNSYLVANIA, 19335
Plain-Language Summary
Department of Defense obligated $132.1 million to SOFTMART GOVERNMENT SERVICES, INC for work described as: ORDER 21996-C3 Key points: 1. Significant spending of $132M on software publishing. 2. Full and open competition was utilized, but specific details on price discovery are limited. 3. Potential risk associated with a firm fixed-price contract over a long duration. 4. Sector context: Software publishing is a dynamic field requiring continuous evaluation of technology and pricing.
Value Assessment
Rating: fair
The contract value of $132M over approximately 3 years is substantial. Without specific unit cost data or comparison to similar software publishing contracts, assessing value for money is challenging. The firm fixed-price nature suggests a defined scope, but market shifts in software can impact its long-term value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which is generally positive for price discovery. However, the limited data provided does not detail the bidding process or the number of bidders, making it difficult to assess the effectiveness of the competition in driving down costs.
Taxpayer Impact: The use of full and open competition aims to ensure taxpayer funds are used efficiently. However, the overall value and necessity of the software over the contract's lifespan will ultimately determine the true taxpayer impact.
Public Impact
Taxpayers funded a significant contract for software publishing services. The Department of the Army utilized a competitive process for this acquisition. The contract duration and fixed-price nature may have implications for adaptability to evolving software needs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of detailed pricing benchmarks.
- Potential for overpayment due to fixed-price contract in a rapidly changing software market.
- Limited insight into the specific software procured and its ongoing utility.
Positive Signals
- Awarded under full and open competition.
- Contract has a defined end date.
Sector Analysis
The software publishing sector is characterized by rapid innovation and evolving licensing models. Benchmarking spending in this area requires careful consideration of the specific software, its criticality, and the prevailing market rates for similar solutions.
Small Business Impact
The data indicates this contract was not awarded to small businesses, as the 'sb' field is false. Further analysis would be needed to determine if small businesses had an opportunity to compete or if this was a large-scale enterprise solution.
Oversight & Accountability
Oversight of this contract would involve monitoring performance, ensuring deliverables meet requirements, and validating that the firm fixed-price remained appropriate throughout the contract term. The 'aw' field indicates 'DO', suggesting a Departmental Order, which may have specific oversight protocols.
Related Government Programs
- Software Publishers
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Lack of detailed cost breakdown.
- Potential for technology obsolescence within a fixed-price contract.
- Limited information on specific software utility and performance.
- No indication of small business participation.
Tags
software-publishers, department-of-defense, pa, do, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $132.1 million to SOFTMART GOVERNMENT SERVICES, INC. ORDER 21996-C3
Who is the contractor on this award?
The obligated recipient is SOFTMART GOVERNMENT SERVICES, INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $132.1 million.
What is the period of performance?
Start: 2006-09-20. End: 2009-05-30.
What was the specific software procured under this contract, and how did its capabilities align with the Army's evolving needs over the contract period?
The provided data does not specify the exact software. Understanding the nature of the software (e.g., operating systems, specialized applications, development tools) is crucial. Its alignment with the Army's needs would be assessed by reviewing contract performance reports, user feedback, and any modifications or extensions granted during its term, to ensure it remained relevant and effective.
Given the firm fixed-price structure and the dynamic nature of software, what mechanisms were in place to mitigate the risk of the government overpaying for outdated technology?
Mitigation strategies for fixed-price software contracts often include clauses for price adjustments based on market changes, regular performance reviews, and options for early termination if technology becomes obsolete. The effectiveness of these mechanisms would depend on the specific contract language and the government's proactive management in monitoring software lifecycles and market trends.
How did the full and open competition process ensure the best possible price and value for the government compared to other contracting methods?
Full and open competition theoretically maximizes the pool of potential bidders, fostering a competitive environment that drives down prices and encourages innovative solutions. To confirm its effectiveness here, one would examine the number of bids received, the variance in proposed prices, and whether the winning bid represented a significant cost saving compared to initial estimates or sole-source alternatives.
Industry Classification
NAICS: Information › Software Publishers › Software Publishers
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 9
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Softmart, Inc. (UEI: 050383223)
Address: 450 ACORN LN, DOWNINGTOWN, PA, 06
Business Categories: Category Business, Small Business
Financial Breakdown
Contract Ceiling: $132,137,805
Exercised Options: $132,137,805
Current Obligation: $132,135,819
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0010402AZE84
IDV Type: IDC
Timeline
Start Date: 2006-09-20
Current End Date: 2009-05-30
Potential End Date: 2009-05-30 00:00:00
Last Modified: 2010-09-02
More Contracts from Softmart Government Services, Inc
- Clins - Option Year 4 — $128.1M (Department of Defense)
- Order 22296-C3 (part 1) — $125.4M (Department of Defense)
- 200512!501738!2100!w91quz!aca, Itec4 !n0010402aze84 !A!N! !N!D002 !01 !20050920!20051120!073366119!073366119!073366119!n!softmart Government Services, !450 Acorn LN !downingtown !pa!19335!19752!029!42!downingtown !chester !penn !+000000712409!n!n!000000000000!7030!adp Software !A7 !electronics and Communication Equip !000 !* !423430!E! !7! ! !C! ! !20200930!c!a!n!n!z!a!u!j!2!009! ! !Z!N!Z! ! !y!b!n!n! ! !Z! !a!a!000!a!b!n! ! ! ! !2100! !0001! ! — $122.5M (Department of Defense)
- Federal Contract — $104.8M (Social Security Administration)
- Enterprise Software Assurance — $42.3M (Department of Defense)
View all Softmart Government Services, Inc federal contracts →
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)