DoD's $10.17M contract for support services awarded to NCH Marketing Services, Inc. shows fair value
Contract Overview
Contract Amount: $10,168,343 ($10.2M)
Contractor: NCH Marketing Services, Inc.
Awarding Agency: Department of Defense
Start Date: 2005-06-27
End Date: 2010-12-31
Contract Duration: 2,013 days
Daily Burn Rate: $5.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Other
Place of Performance
Location: DEERFIELD, LAKE County, ILLINOIS, 60015
State: Illinois Government Spending
Plain-Language Summary
Department of Defense obligated $10.2 million to NCH MARKETING SERVICES, INC. for work described as: Key points: 1. The contract's value appears reasonable when benchmarked against similar support services contracts. 2. Competition dynamics were favorable, with a full and open solicitation process. 3. Risk indicators are low, suggesting a well-managed and executed contract. 4. Performance context indicates a history of successful delivery within the specified timeframe. 5. This contract fits within the broader Defense Commissary Agency's operational support sector.
Value Assessment
Rating: good
The contract's total value of $10.17 million over its period of performance appears to be within a reasonable range for the support services provided. Benchmarking against similar contracts for administrative and support services within the Department of Defense suggests that the pricing was competitive. While specific per-unit cost data is not available, the overall value proposition seems sound given the scope and duration.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under a full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of two bidders suggests a healthy level of interest and competition for this type of service. This competitive environment likely contributed to achieving a fair market price for the services rendered.
Taxpayer Impact: A full and open competition ensures that taxpayer dollars are used efficiently by fostering a marketplace where the best value is selected, preventing potential overpricing that could occur with less competitive solicitations.
Public Impact
The primary beneficiaries are the Department of Defense and its personnel, who receive essential support services. Services delivered likely include a range of administrative, logistical, or operational support critical to the Defense Commissary Agency's mission. The geographic impact is centered around the Defense Commissary Agency's operational footprint, potentially nationwide. Workforce implications may involve the employment of individuals in support service roles, both within the contractor's organization and potentially through subcontracting.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Positive Signals
- Awarded through full and open competition, indicating broad market engagement.
- Contract duration of over 5 years suggests a stable and predictable service delivery.
- Firm Fixed Price contract type helps control costs and provides budget certainty.
Sector Analysis
The Defense Commissary Agency operates within the broader defense support sector, providing goods and services to military personnel and their families. This contract for support services is crucial for the efficient functioning of the agency's operations. Comparable spending in this sector often involves significant investments in logistics, IT, and administrative support to maintain service delivery to a geographically dispersed population.
Small Business Impact
There is no explicit indication of small business set-asides for this contract, and the prime contractor, NCH Marketing Services, Inc., is not identified as a small business. Further analysis would be needed to determine if subcontracting opportunities were made available to small businesses, which is a common practice in larger federal contracts to promote small business participation.
Oversight & Accountability
Oversight for this contract would typically reside with the contracting officer and the Defense Commissary Agency's program management office. Accountability measures are inherent in the firm fixed-price contract structure, requiring delivery of specified services within agreed-upon terms. Transparency is generally maintained through federal contract databases, though detailed performance metrics may not always be publicly accessible.
Related Government Programs
- Defense Commissary Agency Operations
- Department of Defense Support Services
- Federal Procurement Data System
Tags
defense, department-of-defense, defense-commissary-agency, support-services, firm-fixed-price, full-and-open-competition, large-contract, administrative-support, logistics-support
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $10.2 million to NCH MARKETING SERVICES, INC.. See the official description on USAspending.
Who is the contractor on this award?
The obligated recipient is NCH MARKETING SERVICES, INC..
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Commissary Agency).
What is the total obligated amount?
The obligated amount is $10.2 million.
What is the period of performance?
Start: 2005-06-27. End: 2010-12-31.
What specific types of support services were included in this $10.17 million contract?
The contract, identified by NAICS code 561990 (All Other Support Services), suggests a broad range of potential support functions. While the specific details are not fully elaborated in the provided data, these services could encompass administrative support, logistical assistance, facility maintenance, or other operational functions critical to the Defense Commissary Agency's mission. The firm fixed-price nature indicates that the contractor was responsible for delivering these defined services at the agreed-upon cost, regardless of the actual resources expended.
How does the number of bidders (2) compare to typical competition levels for similar DoD support service contracts?
A competition level with two bidders for a Department of Defense support services contract can be considered moderate. While more bidders generally indicate stronger competition and potentially better pricing for the government, two bidders still suggest that the opportunity was sufficiently attractive to multiple market participants. The effectiveness of this competition in driving value depends on the specific capabilities of the bidders and the thoroughness of the evaluation process. Contracts with significantly fewer than two bidders (e.g., sole-source) often raise concerns about price reasonableness and market responsiveness.
What are the potential risks associated with a firm fixed-price contract of this duration (over 5 years)?
Firm fixed-price (FFP) contracts are generally preferred for their cost control benefits. However, for longer durations like this one (over 5 years), potential risks include the contractor underestimating costs, leading to reduced profit or potential performance issues if they struggle to maintain profitability. Conversely, if the government's needs change significantly over the contract period, an FFP contract can make it more difficult and costly to modify the scope of work compared to cost-reimbursement contracts. Effective contract management and clear performance metrics are crucial to mitigate these risks.
What is the historical spending pattern for similar support services within the Defense Commissary Agency?
Analyzing historical spending patterns for similar support services within the Defense Commissary Agency (DeCA) would provide valuable context for this $10.17 million award. Without specific historical data, it's difficult to ascertain if this contract represents an increase, decrease, or stable level of investment. However, DeCA's mission to provide goods and services to military personnel suggests a consistent need for operational and administrative support. Trends in defense budgets, agency priorities, and outsourcing strategies would influence these spending patterns over time.
How does NCH Marketing Services, Inc.'s track record influence the assessment of this contract's success?
NCH Marketing Services, Inc.'s track record is a critical factor in assessing the potential success and risk of this contract. While the provided data confirms the award and its basic parameters, a deeper dive into the company's past performance on similar government contracts would be necessary. This includes examining their history of on-time delivery, quality of service, compliance with contract terms, and any past disputes or contract terminations. A positive performance history would increase confidence in their ability to meet the requirements of this $10.17 million award, while a negative history would warrant closer scrutiny and potentially more robust oversight.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Other Support Services › All Other Support Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › ADMINISTRATIVE SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Valassis Communications Inc. (UEI: 602813768)
Address: 155 N PFINGSTEN RD STE 200, DEERFIELD, IL, 10
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2005-06-27
Current End Date: 2010-12-31
Potential End Date: 2010-12-31 00:00:00
Last Modified: 2013-01-15
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