Barrett Firearms awarded $13.7M contract for small arms ammunition, raising questions about competition and value

Contract Overview

Contract Amount: $21,543,311 ($21.5M)

Contractor: Barrett Firearms Manufacturing, Inc.

Awarding Agency: Department of Defense

Start Date: 2003-06-09

End Date: 2011-06-08

Contract Duration: 2,921 days

Daily Burn Rate: $7.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200312!001084!2100!AE30 !TACOM - PICATINNY !DAAE3003C1126 !A!N! !N! !20030609!20060930!137250973!137250973!137250973!N!BARRETT FIREARMS MFG INC !5926 MILLER LANE !CHRISTIANA !TN!37037!14900!009!47!CHRISTIE HILL !BLOUNT !TENNESSEE !+000003419832!N!N!000000000000!1005!GUNS, THROUGH 30 MM !A5 !WEAPONS !1000!NOT DISCERNABLE OR CLASSIFIED !332992!E! !3! ! ! ! ! !99990909!B! ! !A! !D!U!J!1!001!N!1A!Z!N!Z! ! !Y!B!N!Y! ! !A! !A!A!000!A!B!N! ! ! ! ! ! !0001! !

Place of Performance

Location: CHRISTIANA, RUTHERFORD County, TENNESSEE, 37037

State: Tennessee Government Spending

Plain-Language Summary

Department of Defense obligated $21.5 million to BARRETT FIREARMS MANUFACTURING, INC. for work described as: 200312!001084!2100!AE30 !TACOM - PICATINNY !DAAE3003C1126 !A!N! !N! !20030609!20060930!137250973!137250973!137250973!N!BARRETT FIREARMS MFG INC !5926 MILLER LANE !CHRISTIANA !TN!37037!14900!009!47!CHRISTIE HILL !BLOUN… Key points: 1. Contract awarded on a sole-source basis, limiting price discovery and potentially increasing costs. 2. Limited competition suggests potential for higher prices compared to a fully competed contract. 3. The contract duration of nearly 8 years (including options) warrants scrutiny for long-term value. 4. Performance context is limited due to the sole-source nature, making direct benchmarking difficult. 5. This contract falls within the broader defense sector, specifically focusing on small arms manufacturing. 6. The absence of small business set-asides or subcontracting plans may limit broader economic impact.

Value Assessment

Rating: questionable

The contract value of $13.7 million over its potential duration is significant for specialized firearms and ammunition. However, without a competitive bidding process, it is difficult to definitively assess whether this represents fair market value. Benchmarking against similar sole-source awards for specialized defense equipment is challenging, but the lack of competition inherently introduces a risk of overpayment. Further analysis would require access to cost breakdowns and comparisons with other government contracts for similar, albeit potentially less specialized, ammunition types.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning only one bidder, Barrett Firearms Manufacturing, Inc., was solicited. This approach is typically used when only one responsible source can satisfy agency requirements. The lack of competition means that taxpayers did not benefit from the price reductions and innovation that can arise from a competitive bidding process. It also limits the government's ability to explore alternative suppliers or solutions.

Taxpayer Impact: The sole-source nature of this award means taxpayers may have paid a premium compared to what could have been achieved through open competition. This limits the government's leverage in negotiating favorable terms and prices.

Public Impact

The primary beneficiary of this contract is Barrett Firearms Manufacturing, Inc., a key supplier to the defense sector. The contract delivers essential small arms ammunition, crucial for military operations and readiness. The geographic impact is concentrated in Tennessee, where Barrett Firearms Manufacturing is located, potentially supporting local employment. Workforce implications may include sustained employment at Barrett Firearms, particularly in specialized manufacturing roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially leading to higher costs for taxpayers.
Long contract duration (nearly 8 years) increases the risk of price escalation or performance issues going unaddressed.
Lack of transparency in the sole-source justification makes it difficult to verify the necessity of this approach.
Absence of small business participation requirements may limit opportunities for smaller firms in the defense supply chain.

Positive Signals

Awarding to a known entity like Barrett Firearms Manufacturing, Inc. may ensure a reliable supply of specialized ammunition.
The contract supports a domestic manufacturer, contributing to the U.S. defense industrial base.
Firm Fixed Price contract type provides cost certainty for the government, assuming the price is fair.

Sector Analysis

The defense sector, particularly the segment focused on small arms and ammunition manufacturing, is characterized by specialized production capabilities and often long-standing relationships between government agencies and key suppliers. Market size for such specialized ammunition can be difficult to quantify due to its niche nature and reliance on government procurement. This contract fits within the broader category of weapon systems procurement, where sole-source awards are not uncommon for highly specialized or proprietary items. Comparable spending benchmarks are scarce due to the unique nature of Barrett's products and the sole-source award.

Small Business Impact

This contract does not appear to include any specific small business set-aside provisions, nor are there explicit indications of subcontracting requirements for small businesses. This means that opportunities for small businesses to participate in this specific procurement are likely limited. The absence of such provisions could mean that the economic benefits are concentrated with the prime contractor, potentially limiting the broader impact on the small business defense ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. Transparency is limited due to the sole-source nature of the award, making it difficult for the public to assess the justification and fairness of the procurement. Accountability measures would be tied to the contract's performance clauses and the firm fixed-price structure, but the lack of competition reduces external accountability.

Related Government Programs

Small Arms Ammunition
Weapon Systems Procurement
Defense Industrial Base Support
Tactical Firearm Manufacturing

Risk Flags

Sole-source award
Lack of competition
Potential for inflated pricing
Long contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $21.5 million to BARRETT FIREARMS MANUFACTURING, INC.. 200312!001084!2100!AE30 !TACOM - PICATINNY !DAAE3003C1126 !A!N! !N! !20030609!20060930!137250973!137250973!137250973!N!BARRETT FIREARMS MFG INC !5926 MILLER LANE !CHRISTIANA !TN!37037!14900!009!47!CHRISTIE HILL !BLOUNT !TENNESSEE !+000003419832!N!N!000000000000!1005!GUNS, THROUGH 30 MM !A5 !WEAPONS !1000!NOT DISCERNABLE OR CLASSIFIED !332992!E! !3! ! ! ! ! !99990909!B

Who is the contractor on this award?

The obligated recipient is BARRETT FIREARMS MANUFACTURING, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $21.5 million.

What is the period of performance?

Start: 2003-06-09. End: 2011-06-08.

What is the specific justification for awarding this contract on a sole-source basis to Barrett Firearms Manufacturing, Inc.?

The provided data indicates the contract was awarded as 'NOT COMPETED,' which typically implies a sole-source justification. Common reasons for sole-source awards in defense procurement include unique capabilities, proprietary technology, urgent needs where only one source can respond, or when competition is deemed not feasible or not in the government's best interest. Without the specific justification document, it's impossible to know the exact rationale. However, Barrett Firearms is known for its specialized rifle systems and associated ammunition, suggesting the justification might relate to unique product specifications or performance requirements that only they can meet. This lack of transparency in the justification process is a common concern with sole-source contracts.

How does the awarded price of $13.7 million compare to market rates for similar small arms ammunition?

Directly comparing the $13.7 million total award value to 'market rates' for similar small arms ammunition is challenging for several reasons. Firstly, the contract is for specialized ammunition likely tied to Barrett's proprietary firearm systems, which may not have direct off-the-shelf market equivalents. Secondly, the award is sole-source, meaning the government did not benefit from competitive bidding, which typically drives prices down. Publicly available data on unit costs for such specialized ammunition is scarce. To assess value, one would need to compare the contract's unit prices (if available) against historical government purchases of similar items, or against prices charged by other manufacturers for comparable, though not identical, ammunition types. The lack of competition inherently raises concerns about whether the price achieved is optimal.

What are the potential risks associated with a sole-source contract of this duration (nearly 8 years)?

Sole-source contracts, especially those with long durations like this one (potentially spanning from 2003 to 2011, nearly 8 years with options), carry several risks. The primary risk is the lack of competitive pressure, which can lead to inflated prices over time as the contractor faces no incentive to reduce costs or offer better value. There's also a risk of complacency in performance or innovation. Furthermore, a long-term sole-source commitment can lock the government into a specific technology or supplier, making it difficult to adapt to new requirements or explore potentially more cost-effective alternatives that might emerge during the contract period. Contractor viability and financial stability over such an extended period also become a factor.

What is the track record of Barrett Firearms Manufacturing, Inc. with government contracts, particularly sole-source awards?

Barrett Firearms Manufacturing, Inc. has a history of supplying firearms and ammunition to the U.S. military and other government agencies. While specific details on their track record with sole-source awards are not provided in this data snippet, their designation as a sole-source provider for certain items suggests a recognized capability or unique product offering. Companies that receive sole-source contracts often have established relationships with the government and a proven ability to meet stringent military specifications. However, a history of sole-source awards, while indicating capability, also necessitates careful oversight to ensure continued fair pricing and performance, as the inherent lack of competition remains a factor.

How does this contract fit into the broader context of U.S. defense spending on small arms and ammunition?

This contract, valued at $13.7 million, represents a small fraction of the overall U.S. defense budget, which runs into hundreds of billions annually. However, it is significant within the niche market of specialized small arms ammunition, particularly for high-performance systems like those produced by Barrett. Defense spending on small arms and ammunition is a continuous requirement, driven by operational needs, training, and maintaining readiness. Contracts like this support the domestic defense industrial base, ensuring the availability of critical components. The trend towards specialized weaponry often necessitates specialized ammunition, sometimes leading to sole-source procurements if only one manufacturer can meet the demanding specifications.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Small Arms Ammunition Manufacturing

Product/Service Code: WEAPONS

Competition & Pricing

Extent Competed: NOT COMPETED

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 5926 MILLER LANE, CHRISTIANA, TN, 04

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

Contract Characteristics

Cost or Pricing Data: NO

Timeline