DoD's $57.5M Logistics Consulting Contract with Boeing Faces Scrutiny for Lack of Competition
Contract Overview
Contract Amount: $57,518,748 ($57.5M)
Contractor: THE Boeing Company
Awarding Agency: Department of Defense
Start Date: 2018-12-13
End Date: 2024-06-12
Contract Duration: 2,008 days
Daily Burn Rate: $28.6K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: TECHNICAL DATA
Place of Performance
Location: SAINT LOUIS, SAINT LOUIS County, MISSOURI, 63134
State: Missouri Government Spending
Plain-Language Summary
Department of Defense obligated $57.5 million to THE BOEING COMPANY for work described as: TECHNICAL DATA Key points: 1. Significant spending on logistics consulting services highlights the need for efficient supply chain management. 2. Boeing, a major aerospace and defense contractor, is the sole awardee, raising questions about competition. 3. The contract's duration and firm fixed-price nature suggest a defined scope, but value for money needs assessment. 4. Potential risks include limited price discovery due to sole-source award and the impact on small businesses.
Value Assessment
Rating: questionable
The contract value of $57.5 million over approximately six years is substantial for consulting services. Without competitive bidding, it's difficult to benchmark against similar contracts to determine if the pricing is optimal.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition may result in the government paying a premium for these services, impacting taxpayer funds.
Public Impact
Taxpayers may be overpaying for logistics consulting due to the absence of competitive bidding. The long-term nature of the contract raises concerns about ongoing costs and the potential for scope creep. Reliance on a single large contractor could stifle innovation and limit opportunities for smaller, specialized firms.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of Competition
- Sole-Source Award
- Potential for Overpricing
- Limited Small Business Participation
Positive Signals
- Definitive Contract Awarded
- Firm Fixed Price Structure
- Long-Term Service Agreement
Sector Analysis
Logistics consulting services are crucial for optimizing supply chains and distribution networks, particularly within the defense sector. Benchmarks for such services vary widely based on scope and duration, but significant contracts typically undergo rigorous competitive evaluation.
Small Business Impact
The data indicates this contract was not awarded to small businesses. The sole-source nature of this large contract likely excludes small businesses from participating, potentially limiting opportunities for specialized logistics support.
Oversight & Accountability
The sole-source award warrants further oversight to ensure the Department of Defense received fair pricing and adequate services. Accountability for the justification of not competing the contract is essential.
Related Government Programs
- Process, Physical Distribution, and Logistics Consulting Services
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competitive bidding
- Potential for inflated pricing
- Limited transparency in award justification
- Exclusion of small businesses
- Long contract duration without re-competition
Tags
process-physical-distribution-and-logist, department-of-defense, mo, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $57.5 million to THE BOEING COMPANY. TECHNICAL DATA
Who is the contractor on this award?
The obligated recipient is THE BOEING COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $57.5 million.
What is the period of performance?
Start: 2018-12-13. End: 2024-06-12.
What was the justification for awarding this contract on a sole-source basis, and what steps were taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of market availability. Without this information, it's impossible to assess if fair and reasonable pricing was achieved. The government should have conducted a price analysis, potentially using historical data or market research, to validate the awarded price against what a competitive process might yield.
What are the specific logistics challenges being addressed, and how does Boeing's expertise uniquely meet these needs to justify a non-competitive award?
Understanding the specific logistics challenges is key to evaluating the necessity of a sole-source award. If Boeing possesses unique, proprietary technology or extensive, specialized knowledge directly tied to the Department of Defense's mission requirements that no other entity can replicate, it might justify the award. However, the government must demonstrate that these unique needs cannot be met through a competitive process, even with specific requirements.
What is the long-term cost-effectiveness of this contract, considering its duration and the absence of competitive pressure to drive down prices?
The long-term cost-effectiveness is a significant concern given the lack of competition. While a firm fixed price provides cost certainty for the defined scope, the absence of competitive pressure over a six-year period could lead to inflated prices compared to what might be achieved through periodic re-competition. Regular performance reviews and potential price adjustments based on market shifts would be crucial for mitigating this risk.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Process, Physical Distribution, and Logistics Consulting Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 6200 JS MCDONNELL BLVD, SAINT LOUIS, MO, 63134
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $57,518,748
Exercised Options: $57,518,748
Current Obligation: $57,518,748
Subaward Activity
Number of Subawards: 7
Total Subaward Amount: $1,882,818
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2018-12-13
Current End Date: 2024-06-12
Potential End Date: 2024-06-12 00:00:00
Last Modified: 2024-03-26
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