DoD awards $46.8M for small arms ammunition, with OCR Global Inc. securing the contract

Contract Overview

Contract Amount: $46,845,918 ($46.8M)

Contractor: OCR Global Inc.

Awarding Agency: Department of Defense

Start Date: 2020-03-31

End Date: 2023-08-31

Contract Duration: 1,248 days

Daily Burn Rate: $37.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: .50 CALIBER LINKED, 4 BALL, 1 TRACER .50 CALIBER LINKED BALL MK 322 MOD 1

Plain-Language Summary

Department of Defense obligated $46.8 million to OCR GLOBAL INC. for work described as: .50 CALIBER LINKED, 4 BALL, 1 TRACER .50 CALIBER LINKED BALL MK 322 MOD 1 Key points: 1. Contract awarded through full and open competition, suggesting a competitive bidding process. 2. The contract duration spans over three years, indicating a sustained need for these supplies. 3. Fixed-price contract type aims to control costs for the government. 4. The specific item procured is .50 caliber linked ammunition, essential for certain military operations. 5. No small business set-aside was utilized, potentially limiting direct participation for smaller firms. 6. The contract was awarded as a delivery order, suggesting it's part of a larger framework agreement or existing contract.

Value Assessment

Rating: fair

Benchmarking the value for this specific type of ammunition is challenging without detailed specifications and market comparisons. However, the firm fixed-price structure provides cost certainty for the Department of Defense. The total award amount of $46.8 million over approximately three years suggests a significant procurement, but the per-unit cost would be the critical factor in assessing true value for money. Without more granular data on the quantity and specific type of ammunition, a definitive value assessment is difficult.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition,' indicating that all responsible sources were permitted to submit bids. This approach generally fosters a competitive environment, which can lead to better pricing and quality for the government. The number of bidders is not specified, but the designation implies that the agency sought the widest possible participation.

Taxpayer Impact: Full and open competition is intended to ensure that taxpayers receive the best possible value by encouraging multiple companies to bid, driving down prices through market forces.

Public Impact

The Department of the Navy benefits from a reliable supply of critical ammunition for its operations. Military personnel operating .50 caliber weapons systems will be equipped with necessary ammunition. The procurement supports readiness for national defense missions. The contract impacts the defense manufacturing sector, specifically small arms ammunition production.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific quantity and unit cost makes value assessment difficult.
No small business participation noted, potentially missing opportunities for economic inclusion.
Contract duration could lead to price fluctuations if market conditions change significantly.

Positive Signals

Firm fixed-price contract provides cost predictability.
Full and open competition suggests a robust market engagement.
Procurement of essential defense materiel ensures operational readiness.

Sector Analysis

The defense industry, particularly the ammunition manufacturing sub-sector, is characterized by specialized production capabilities and stringent quality control requirements. This contract falls within the broader defense industrial base, supplying essential munitions. Comparable spending benchmarks for .50 caliber ammunition can vary widely based on quantity, specific technical requirements (e.g., tracer, armor-piercing), and market conditions. The total award of $46.8 million represents a significant, albeit specific, investment in maintaining ordnance stocks.

Small Business Impact

This contract was not awarded as a small business set-aside, nor is there an indication of specific subcontracting goals for small businesses within the provided data. This means that opportunities for small businesses to directly participate in fulfilling this contract may be limited unless they are prime contractors or choose to subcontract with the awardee. The absence of set-aside provisions suggests the agency prioritized competition among all eligible sources, potentially overlooking direct avenues to engage the small business defense ecosystem for this specific procurement.

Oversight & Accountability

The Department of Defense employs various oversight mechanisms for contracts, including contract performance monitoring, quality assurance surveillance plans, and financial audits. Inspector General (IG) offices within the DoD are responsible for investigating fraud, waste, and abuse. Transparency is generally maintained through contract award databases like FPDS, where basic contract information is publicly available. Specific details on the oversight applied to this particular delivery order would typically reside within internal DoD reporting and audit trails.

Related Government Programs

Small Arms Ammunition
Department of Defense Procurement
Ordnance and Ammunition Manufacturing
Naval Supply Systems Command Contracts

Risk Flags

Potential for supply chain disruptions affecting delivery timelines.
Quality control risks inherent in ammunition manufacturing.
Price volatility in raw materials impacting long-term cost-effectiveness.
Dependence on a single contractor for a critical defense item.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $46.8 million to OCR GLOBAL INC.. .50 CALIBER LINKED, 4 BALL, 1 TRACER .50 CALIBER LINKED BALL MK 322 MOD 1

Who is the contractor on this award?

The obligated recipient is OCR GLOBAL INC..

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $46.8 million.

What is the period of performance?

Start: 2020-03-31. End: 2023-08-31.

What is the historical spending trend for .50 caliber linked ammunition by the Department of the Navy?

Analyzing historical spending trends for specific ammunition types like '.50 caliber linked ball MK 322 MOD 1' requires access to detailed procurement data over multiple fiscal years. While this specific contract award is for $46.8 million from March 2020 to August 2023, understanding the broader trend involves examining previous contracts for similar items. Factors influencing spending include operational tempo, inventory levels, modernization programs, and changes in threat assessments. Without a longitudinal dataset specifically isolating this ammunition type, it's difficult to establish a precise historical spending pattern. However, consistent procurement of such munitions typically indicates ongoing operational requirements and a sustained need within the naval forces for training and combat readiness.

How does the unit cost of this ammunition compare to similar government contracts or commercial market rates?

Determining the precise unit cost for the '.50 caliber linked ball MK 322 MOD 1' ammunition is not possible with the provided data, as the total award amount and contract duration are given, but the total quantity procured is absent. To benchmark effectively, one would need to divide the total contract value by the total number of rounds. Comparing this derived unit cost against other DoD contracts for similar ammunition types, or against commercial catalog prices (if available for military-grade munitions), would be necessary. Factors like bulk purchasing discounts, specific technical specifications (e.g., tracer rounds, specific lot testing), and the competitive landscape at the time of award significantly influence unit pricing. A firm fixed-price contract suggests the government aimed to lock in a price, but its competitiveness relies on the accuracy of the initial cost estimates and the bidding environment.

What are the key performance indicators (KPIs) used to evaluate the contractor's performance on this contract?

Key Performance Indicators (KPIs) for defense supply contracts typically revolve around timely delivery, quality compliance, and adherence to contract specifications. For ammunition procurement, critical KPIs would include meeting delivery schedules outlined in the contract, ensuring the ammunition meets all technical requirements (e.g., ballistics, reliability, shelf-life), and proper packaging and handling. The Department of the Navy likely has a Quality Assurance Surveillance Plan (QASP) in place to monitor OCR Global Inc.'s performance against these metrics. Failure to meet these KPIs could result in contract remedies, such as price adjustments, rejection of non-conforming goods, or even termination for default. The contract type (Firm Fixed Price) also implies that the contractor bears the risk of cost overruns, incentivizing efficient performance.

What is the strategic importance of this specific type of ammunition (.50 caliber linked ball) to the Department of the Navy?

The .50 caliber (12.7mm) linked ball ammunition is a versatile and widely used round within naval operations. It is employed in various weapon systems, including heavy machine guns mounted on naval vessels (e.g., patrol boats, surface combatants), vehicles, and aircraft. Its effectiveness lies in its range, accuracy, and ability to engage a variety of targets, from personnel and light armored vehicles to low-flying aircraft and drones. Linked ammunition is particularly crucial for sustained firing rates in machine guns. The 'MK 322 MOD 1' designation suggests a specific military specification, likely optimized for performance and reliability in demanding maritime environments. Ensuring a steady supply of this ammunition is vital for maintaining naval force protection, maritime interdiction operations, and overall combat readiness.

Are there any known risks associated with the contractor, OCR Global Inc., based on past performance or financial stability?

Assessing the specific risks associated with OCR Global Inc. requires a review of their past performance records, including any past performance evaluations (e.g., CPARS - Contractor Performance Assessment Reporting System), litigation history, and financial health indicators. Government agencies typically conduct pre-award responsibility determinations that include evaluating a contractor's track record. Without access to these internal DoD assessments or public records of significant issues related to OCR Global Inc., it is difficult to identify specific risks. However, general risks in defense contracting can include supply chain disruptions, manufacturing quality issues, or financial instability, which could impact delivery schedules and product quality. The DoD's contracting process aims to mitigate these risks through vetting and ongoing performance monitoring.

What is the potential impact of this contract on the small arms ammunition market and competition?

This $46.8 million contract awarded to OCR Global Inc. represents a significant transaction within the small arms ammunition market. As it was procured through full and open competition, it suggests that the market has multiple capable suppliers for this type of munition. The award to a single entity, OCR Global Inc., indicates their competitiveness in terms of price, capability, and past performance. The duration of the contract (over three years) means that a substantial portion of the Navy's demand for this specific ammunition is met by this award, potentially impacting the ability of other manufacturers to secure similar large-volume contracts during this period. However, the overall market likely remains dynamic, with other contracts and requirements existing for different ammunition types or quantities.

Industry Classification

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

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0016417RJN41

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2677 PROSPERITY AVE STE 310, FAIRFAX, VA, 22031

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Minority Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $46,845,918

Exercised Options: $46,845,918

Current Obligation: $46,845,918

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0016418DJN41

IDV Type: IDC

Timeline