DLA awards $13.15M for bulk fuel management software, highlighting software publisher competition

Contract Overview

Contract Amount: $13,151,113 ($13.2M)

Contractor: Carahsoft Technology Corp

Awarding Agency: Department of Defense

Start Date: 2024-05-21

End Date: 2026-12-31

Contract Duration: 954 days

Daily Burn Rate: $13.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: DLA INFORMATION OPERATIONS J6 BULK FUEL MANAGEMENT (BFM) SOFTWARE UPGRADE NEW TASK ORDER.

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22240

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $13.2 million to CARAHSOFT TECHNOLOGY CORP for work described as: DLA INFORMATION OPERATIONS J6 BULK FUEL MANAGEMENT (BFM) SOFTWARE UPGRADE NEW TASK ORDER. Key points: 1. Value for money assessed through firm-fixed-price contract and competitive bidding. 2. Competition dynamics show a robust market for specialized logistics software. 3. Risk indicators include contract duration and potential for scope creep. 4. Performance context is within the Defense Logistics Agency's critical fuel management operations. 5. Sector positioning is within the software publishing industry supporting defense logistics.

Value Assessment

Rating: good

The contract's firm-fixed-price structure provides cost certainty. Benchmarking against similar software development and licensing contracts suggests the pricing is within a reasonable range, especially considering the specialized nature of defense logistics software. The award value of $13.15 million over approximately 2.6 years indicates a significant investment in maintaining and upgrading critical operational systems.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors were eligible to bid. The presence of 3 bidders suggests a healthy level of competition for this specialized software requirement. This competitive environment is expected to drive more favorable pricing and innovative solutions for the Defense Logistics Agency.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best value and prevent overpayment for essential software services.

Public Impact

The primary beneficiaries are the Defense Logistics Agency and military personnel relying on efficient fuel management. Services delivered include software upgrades, maintenance, and support for the Bulk Fuel Management system. Geographic impact is nationwide, supporting military operations across various bases and deployments. Workforce implications include ensuring logistics personnel have reliable tools for their duties.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if future upgrades are not competitively procured.
Reliance on a single software publisher could pose long-term supply chain risks.
The duration of the contract (over 2 years) necessitates careful monitoring for performance and adherence to scope.

Positive Signals

Awarded through full and open competition, indicating a competitive marketplace.
Firm-fixed-price contract type provides cost predictability.
The Defense Logistics Agency's established processes likely include performance monitoring and quality assurance.

Sector Analysis

The software publishing industry is a significant sector supporting government operations. This contract falls within the sub-sector of specialized enterprise resource planning (ERP) and logistics management software. Comparable spending benchmarks for similar government software contracts can vary widely based on complexity, but this award is substantial, reflecting the critical nature of fuel management for defense readiness.

Small Business Impact

While this contract was awarded to Carahsoft Technology Corp, a large reseller, the underlying software publisher is not specified as a small business. There is no explicit small business set-aside mentioned. Further analysis would be needed to determine if small businesses are involved as subcontractors or if this contract impacts the small business ecosystem in this specific software niche.

Oversight & Accountability

Oversight is likely managed by the Defense Logistics Agency's contracting officers and program managers. Accountability measures are embedded in the firm-fixed-price contract terms and performance expectations. Transparency is facilitated through contract award databases, though detailed performance metrics may not be publicly available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Defense Logistics Agency Information Technology Support
DoD Enterprise Software Procurement
Logistics and Supply Chain Management Systems
Fuel Management Systems
Defense Software Modernization

Risk Flags

Potential for vendor lock-in
Reliance on specific software publisher
Contract duration requires ongoing performance monitoring

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $13.2 million to CARAHSOFT TECHNOLOGY CORP. DLA INFORMATION OPERATIONS J6 BULK FUEL MANAGEMENT (BFM) SOFTWARE UPGRADE NEW TASK ORDER.

Who is the contractor on this award?

The obligated recipient is CARAHSOFT TECHNOLOGY CORP.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $13.2 million.

What is the period of performance?

Start: 2024-05-21. End: 2026-12-31.

What is the track record of Carahsoft Technology Corp in fulfilling similar large-scale IT contracts for the Department of Defense?

Carahsoft Technology Corp is a prominent government IT reseller that holds numerous contracts and agreements with various federal agencies, including the Department of Defense. They specialize in providing a wide range of software and hardware solutions through various contract vehicles, such as GSA Schedules and NASA SEWP. While Carahsoft itself is a reseller, their success is often tied to the performance of the software publishers they represent. For this specific contract, it's a BPA Call, indicating it's an order against a pre-existing Blanket Purchase Agreement. Their track record in managing such calls is generally robust, focusing on efficient procurement and delivery of authorized products and services. The actual performance of the software will depend on the publisher, but Carahsoft's role as a facilitator is well-established within the federal IT landscape.

How does the $13.15 million award compare to historical spending on bulk fuel management software by the DLA?

Historical spending data for DLA's bulk fuel management software is not readily available in the provided context. However, the $13.15 million award for a new task order covering software upgrades and support over approximately 2.6 years (from May 2024 to December 2026) suggests a significant and ongoing investment in this critical capability. To provide a precise comparison, one would need to access DLA's historical contract databases to identify previous awards for similar software maintenance, licensing, and upgrade services related to their fuel management systems. Such an analysis would reveal trends in spending, potential cost increases or decreases over time, and the frequency of major system overhauls.

What are the primary risks associated with a firm-fixed-price contract for software upgrades, and how are they mitigated?

The primary risk with a firm-fixed-price (FFP) contract for software upgrades is that the contractor may face unforeseen technical challenges or scope creep, potentially leading to reduced profit margins or a temptation to cut corners on quality to maintain profitability. For the government, the risk is that the fixed price might not reflect the true value if the scope is significantly less than anticipated or if the contractor fails to deliver the full functionality. Mitigation strategies employed by the DLA likely include detailed performance work statements (PWS), clear acceptance criteria, robust project management, and potentially phased delivery schedules. Regular technical reviews and progress meetings help identify and address issues early, ensuring the contractor stays within scope and meets quality standards. The competitive nature of the award also incentivizes the contractor to price accurately and perform diligently.

What is the expected impact of this software upgrade on the efficiency and effectiveness of DLA's fuel operations?

This software upgrade is expected to enhance the efficiency and effectiveness of DLA's Bulk Fuel Management (BFM) operations by modernizing critical systems. Upgraded software typically offers improved data processing capabilities, better user interfaces, enhanced security features, and potentially new functionalities that streamline inventory tracking, distribution, and financial reconciliation. For DLA, this translates to more accurate fuel accounting, reduced manual data entry, faster reporting, and better decision-making support for logistics planners. Ultimately, these improvements contribute to greater operational readiness, reduced waste, and more cost-effective management of the military's fuel supply chain, which is vital for global operations.

How does the competition level (3 bidders) for this contract influence the potential value for taxpayers?

A competition level involving three bidders generally indicates a healthy market for the specific goods or services being procured. For taxpayers, this level of competition is beneficial because it typically drives down prices as contractors vie for the award. It also encourages innovation, as bidders are motivated to offer their best solutions and pricing to win the contract. When there are multiple capable vendors, the procuring agency has a stronger position to negotiate favorable terms and ensure that the final price reflects a fair market value. Conversely, if there were only one or two bidders, there might be concerns about limited price discovery and potentially higher costs for the government.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: SP470124Q0065

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11493 SUNSET HILLS RD, RESTON, VA, 20190

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $16,353,392

Exercised Options: $13,151,113

Current Obligation: $13,151,113

Actual Outlays: $2,134,853

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N6600119A0010

IDV Type: BPA

Timeline