DoD awards $5.56M contract for shelf stocking and custodial services to Challenge Unlimited, Inc

Contract Overview

Contract Amount: $5,563,099 ($5.6M)

Contractor: Challenge Unlimited, Inc.

Awarding Agency: Department of Defense

Start Date: 2022-08-01

End Date: 2026-07-31

Contract Duration: 1,460 days

Daily Burn Rate: $3.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SHELF STOCKING AND CUSTODIAL OPERATIONS

Place of Performance

Location: SCOTT AFB, SAINT CLAIR County, ILLINOIS, 62225

State: Illinois Government Spending

Plain-Language Summary

Department of Defense obligated $5.6 million to CHALLENGE UNLIMITED, INC. for work described as: SHELF STOCKING AND CUSTODIAL OPERATIONS Key points: 1. Contract value of $5.56 million over four years suggests a steady demand for essential support services. 2. The 'Not Available for Competition' award raises questions about the procurement process and potential missed savings. 3. The firm-fixed-price structure shifts performance risk to the contractor, incentivizing efficient service delivery. 4. Service Type (NAICS 561990) indicates a broad range of support functions, requiring versatile operational capabilities. 5. Contract duration of 1460 days provides stability for the contractor and consistent service for the agency. 6. The single award indicates a specific need or a limited pool of qualified providers for these specialized services.

Value Assessment

Rating: fair

The contract value of $5.56 million over four years averages to approximately $1.39 million annually. Benchmarking this against similar contracts for shelf stocking and custodial services is challenging without more specific details on the scope of work and geographic location. However, the 'Not Available for Competition' designation suggests that a competitive process was not utilized, which often leads to less favorable pricing compared to open competition. Without comparative bids or market analysis, it is difficult to definitively assess value for money, but the lack of competition is a potential indicator of suboptimal pricing.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as 'Not Available for Competition,' indicating that a full and open competitive process was not conducted. This typically occurs when only one source is capable of meeting the agency's needs, or in specific circumstances like urgent requirements or the existence of a statutory exception. The lack of multiple bidders means there was no direct price comparison or negotiation driven by market forces, potentially impacting the final price and overall value.

Taxpayer Impact: Taxpayers may not have received the best possible price due to the absence of a competitive bidding process. This award mechanism limits the government's ability to leverage market competition to drive down costs.

Public Impact

The Defense Commissary Agency (DeCA) benefits from consistent shelf stocking and custodial operations, ensuring a well-maintained and functional environment for military personnel and their families. Essential services including stocking shelves and maintaining cleanliness are delivered, contributing to the overall operational efficiency of the commissary. The contract is being performed in Illinois (IL), impacting the local workforce and economy within that state. The contract supports jobs related to logistics, inventory management, and facility maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs for taxpayers.
The broad scope of 'All Other Support Services' could mask inefficiencies if not closely monitored.
Performance metrics and quality control mechanisms are crucial given the sole-source nature of the award.

Positive Signals

The firm-fixed-price contract incentivizes the contractor to manage costs effectively.
A four-year contract provides stability and predictability for service delivery.
The contractor, Challenge Unlimited, Inc., is being awarded a contract, indicating they meet the agency's requirements.

Sector Analysis

This contract falls within the broader support services sector, specifically encompassing facility maintenance and logistics. The NAICS code 561990, 'All Other Support Services,' covers a wide array of non-classified support activities. The market for such services is generally robust, with numerous providers ranging from small businesses to large corporations. However, specific contracts like this, especially when awarded on a sole-source basis, may represent niche requirements or existing relationships. Comparable spending benchmarks are difficult to establish without detailed scope of work, but facility support services are a significant component of federal agency operational budgets.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false, sb=false). The award to Challenge Unlimited, Inc., a single entity, does not inherently preclude subcontracting opportunities for small businesses. However, without specific subcontracting plans mandated in the contract, the extent of small business participation is uncertain. The absence of a set-aside suggests the primary procurement strategy did not prioritize small business engagement for this specific requirement.

Oversight & Accountability

Oversight for this contract would primarily reside with the Department of Defense and the Defense Commissary Agency. As a definitive contract, it is subject to standard federal procurement regulations and oversight. Accountability measures would be defined by the contract's performance standards and deliverables. Transparency is facilitated through contract databases like FPDS, though the 'Not Available for Competition' aspect limits insight into the pre-award decision-making process. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Commissary Agency Operations
Federal Facility Support Services
Logistics and Warehousing Support
Government Contracting Services

Risk Flags

Lack of Competition
Potential for Overpricing
Scope Definition Ambiguity

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $5.6 million to CHALLENGE UNLIMITED, INC.. SHELF STOCKING AND CUSTODIAL OPERATIONS

Who is the contractor on this award?

The obligated recipient is CHALLENGE UNLIMITED, INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Commissary Agency).

What is the total obligated amount?

The obligated amount is $5.6 million.

What is the period of performance?

Start: 2022-08-01. End: 2026-07-31.

What specific services are included under 'Shelf Stocking and Custodial Operations' for this contract?

The provided data indicates the contract covers 'SHELF STOCKING AND CUSTODIAL OPERATIONS' under NAICS code 561990 (All Other Support Services). While the specific details of the Statement of Work (SOW) are not included, these terms generally encompass tasks such as replenishing inventory on retail shelves, maintaining product displays, and performing cleaning and janitorial duties within the facility. This could include sweeping, mopping, dusting, trash removal, restroom sanitation, and general upkeep of commissary spaces. The exact scope would be detailed in the contract's SOW, which would outline specific duties, frequencies, performance standards, and any specialized requirements.

Why was this contract awarded on a 'Not Available for Competition' basis?

The designation 'Not Available for Competition' (CT: NOT AVAILABLE FOR COMPETITION) signifies that the contract was not awarded through a full and open competitive process. Common reasons for this include: a sole-source justification (e.g., only one known capable contractor), urgent and compelling needs where competition is impractical, or specific statutory authority allowing for non-competitive awards. Without further documentation or justification from the awarding agency (Department of Defense, Defense Commissary Agency), the precise reason remains unspecified. This procurement approach limits the government's ability to leverage market competition to potentially achieve lower prices or better terms.

What is the typical cost range for similar shelf stocking and custodial contracts in the federal sector?

Determining a typical cost range for shelf stocking and custodial contracts is highly variable and depends heavily on the scope of work, geographic location, facility size, service frequency, and specific requirements. Contracts can range from tens of thousands to millions of dollars annually. For instance, smaller facilities or less frequent services might cost under $100,000 per year, while large-scale operations in high-cost-of-living areas could exceed $1 million annually. The $1.39 million annual average for this DoD contract suggests a significant scope, likely involving multiple facilities or extensive service requirements within its operational area in Illinois.

What are the performance risks associated with a firm-fixed-price contract for these services?

For the government, the primary risk with a firm-fixed-price (FFP) contract is that the contractor may cut corners on quality or service to maximize profit if oversight is insufficient. However, the FFP structure generally places most of the cost and performance risk on the contractor. Challenge Unlimited, Inc. is obligated to perform the work for the agreed-upon price, regardless of their actual costs. If their costs exceed the fixed price due to unforeseen issues, inefficiencies, or rising labor/material costs, their profit margin will decrease, or they could incur a loss. Conversely, if they manage costs effectively, their profit increases. The government's main concern is ensuring the contractor meets all performance standards outlined in the contract.

How does the Defense Commissary Agency typically procure support services like these?

The Defense Commissary Agency (DeCA) procures a wide range of goods and services to support its mission of providing high-quality groceries to military personnel and their families at competitive prices. Support services, including facility maintenance, custodial operations, and logistics, are often procured through various contract types. Historically, DeCA has utilized both competitive and non-competitive awards, depending on the specific requirement, urgency, and market availability. The agency aims to achieve best value, which can be determined through price competition or other factors in sole-source situations. The specific procurement method for this contract ('Not Available for Competition') suggests a particular circumstance led to this award decision.

What is the track record of Challenge Unlimited, Inc. with federal contracts?

Challenge Unlimited, Inc. has been awarded federal contracts, as evidenced by this $5.56 million definitive contract from the Department of Defense. To assess their track record thoroughly, one would need to examine their contract history, including past performance evaluations, any disputes or terminations, and the types and values of previous awards. Information available through federal procurement data systems (like FPDS) can provide insights into their experience with government agencies, contract types, and compliance history. Without access to detailed performance reviews or a broader history, it's difficult to provide a comprehensive assessment beyond the fact that they have secured this significant contract.

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: 4 EMMIE L KAUS LN, ALTON, IL, 62002

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: $15,908,300

Exercised Options: $11,920,176

Current Obligation: $5,563,099

Actual Outlays: $2,240,602

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline