DoD's $10.4M Contract for Shelf Stocking and Custodial Services Awarded to SERVTECH
Contract Overview
Contract Amount: $10,384,634 ($10.4M)
Contractor: Servtech
Awarding Agency: Department of Defense
Start Date: 2021-09-01
End Date: 2026-08-31
Contract Duration: 1,825 days
Daily Burn Rate: $5.7K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: SHELF STOCKING, RECEIVING STORAGE HOLDING AREA (RSHA) AND CUSTODIAL OPERATIONS
Place of Performance
Location: JB ANDREWS, PRINCE GEORGES County, MARYLAND, 20762
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $10.4 million to SERVTECH for work described as: SHELF STOCKING, RECEIVING STORAGE HOLDING AREA (RSHA) AND CUSTODIAL OPERATIONS Key points: 1. Contract awarded to SERVTECH for shelf stocking, RSHA, and custodial operations. 2. The contract has a total value of $10.4 million over five years. 3. This is a definitive contract with a firm fixed price. 4. The contract was not available for competition, raising potential concerns about price discovery.
Value Assessment
Rating: questionable
Pricing is based on a firm fixed price structure. Without competitive bidding, it's difficult to assess if this price is optimal or if it represents fair market value compared to similar support services contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was not available for competition, indicating a sole-source award. This limits price discovery and may lead to higher costs for taxpayers as there was no market pressure to achieve the lowest possible price.
Taxpayer Impact: The lack of competition could result in the government paying more than necessary for these essential support services.
Public Impact
Ensures essential functions like shelf stocking and custodial services are maintained within DoD facilities. Supports operational readiness by keeping storage areas organized and facilities clean. Provides employment opportunities through the contractor, SERVTECH.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Potential for overpayment due to sole-source award
Positive Signals
- Contract ensures continuity of essential services
- Firm fixed price contract provides cost certainty
Sector Analysis
This contract falls under 'All Other Support Services' (NAICS 561990), a broad category encompassing various non-specialized support functions. Benchmarks for this specific niche are hard to establish due to its diverse nature, but overall support services spending by the DoD is substantial.
Small Business Impact
The contract was awarded to SERVTECH, a single entity. There is no information provided regarding subcontracting opportunities for small businesses within this contract.
Oversight & Accountability
As a sole-source award, oversight is crucial to ensure the contractor is meeting performance requirements and that the pricing remains reasonable throughout the contract duration. Regular performance reviews and cost analysis would be beneficial.
Related Government Programs
- All Other Support Services
- Department of Defense Contracting
- Defense Commissary Agency Programs
Risk Flags
- Sole-source award limits competition
- Potential for non-competitive pricing
- Lack of transparency on justification for sole-source
- No clear indication of small business subcontracting
Tags
all-other-support-services, department-of-defense, md, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $10.4 million to SERVTECH. SHELF STOCKING, RECEIVING STORAGE HOLDING AREA (RSHA) AND CUSTODIAL OPERATIONS
Who is the contractor on this award?
The obligated recipient is SERVTECH.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Commissary Agency).
What is the total obligated amount?
The obligated amount is $10.4 million.
What is the period of performance?
Start: 2021-09-01. End: 2026-08-31.
What is the justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair pricing?
The data states the contract was 'NOT AVAILABLE FOR COMPETITION,' implying a sole-source award. Without further details on the justification (e.g., unique capabilities, urgent need), it's difficult to assess the necessity. Steps to ensure fair pricing in sole-source situations typically involve detailed cost analysis, comparison to historical data, or independent government cost estimates. The effectiveness of these measures is not evident from the provided data.
What are the potential risks associated with a sole-source contract for essential support services like stocking and custodial operations?
The primary risk of a sole-source contract is the potential for inflated pricing due to the absence of competitive pressure. This can lead to inefficient use of taxpayer funds. Additionally, there's a risk of vendor complacency or reduced service quality over time, as the contractor may not feel compelled to innovate or improve services when there is no threat of losing the contract to a competitor.
How does the firm fixed price structure impact the government's ability to manage costs and ensure value for money in this contract?
A firm fixed price (FFP) contract provides the government with cost certainty, as the price is set and generally not subject to adjustment based on the contractor's cost experience. While this simplifies budgeting, in a sole-source scenario, the initial FFP might be higher than it would be under competition. The government must still ensure the FFP is fair and reasonable at the time of award through robust cost analysis.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Other Support Services › All Other Support Services
Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1406 N MAIN ST, MERIDIAN, ID, 83642
Business Categories: AbilityOne Program Participant, Category Business, Corporate Entity Tax Exempt, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $13,005,847
Exercised Options: $13,005,847
Current Obligation: $10,384,634
Actual Outlays: $4,056,472
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2021-09-01
Current End Date: 2026-08-31
Potential End Date: 2026-08-31 00:00:00
Last Modified: 2025-12-04
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