DoD's $276M apparel contract awarded to The Specialized Company for Trade Services shows potential value concerns

Contract Overview

Contract Amount: $27,634,900 ($27.6M)

Contractor: THE Specialized Company for Trade Services

Awarding Agency: Department of Defense

Start Date: 2015-09-29

End Date: 2015-11-30

Contract Duration: 62 days

Daily Burn Rate: $445.7K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 8502561125!14 YEAR OLD

Plain-Language Summary

Department of Defense obligated $27.6 million to THE SPECIALIZED COMPANY FOR TRADE SERVICES for work described as: 8502561125!14 YEAR OLD Key points: 1. The contract's value appears high relative to its short duration, suggesting a need for detailed cost analysis. 2. Limited competition, despite being 'full and open after exclusion of sources,' may have impacted price discovery. 3. The firm fixed-price structure shifts risk to the contractor but requires careful monitoring of performance. 4. This contract falls within the broader 'Men's and Boys' Cut and Sew Apparel Manufacturing' sector. 5. The award to a single contractor warrants scrutiny regarding market dynamics and potential barriers to entry. 6. The short performance period (62 days) for a contract of this magnitude raises questions about the scope of work.

Value Assessment

Rating: questionable

The contract's total value of $276,349,000 for a mere 62-day performance period is exceptionally high. This translates to an average daily cost of over $4.45 million. Benchmarking against similar apparel manufacturing contracts is difficult without more specific details on the goods or services procured, but the per-day expenditure is a significant indicator. The firm fixed-price nature means the government is obligated to pay the full amount, making the initial pricing assessment critical. Without further data on the specific items or services, it's challenging to definitively assess value for money, but the high daily burn rate is a red flag.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'full and open competition after exclusion of sources.' This designation implies that while the solicitation was broadly advertised, certain sources were intentionally excluded before the final award. The exact reasons for exclusion are not provided, but this process inherently limits the pool of potential bidders compared to truly unrestricted full and open competition. The fact that only one award was made suggests that either the requirements were highly specialized, or the exclusion criteria significantly narrowed the field, potentially reducing competitive pressure.

Taxpayer Impact: The limited competition may have resulted in a higher price for taxpayers than could have been achieved through a broader, more inclusive bidding process. It also raises questions about whether the exclusion of certain sources was justified and beneficial to the government's interests.

Public Impact

The primary beneficiaries are the Department of Defense, which receives the procured apparel. The contract delivers essential clothing items for military personnel, supporting operational readiness. The geographic impact is likely concentrated where the contractor's manufacturing facilities are located. Workforce implications include employment at the contractor's facilities for manufacturing and related support roles.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

High daily expenditure raises concerns about cost-effectiveness for the short duration.
The 'exclusion of sources' clause warrants investigation into the justification and impact on competition.
Lack of detail on specific goods/services makes independent value assessment difficult.
The short performance period for such a large sum suggests a potentially narrow or urgent scope of work.

Positive Signals

Firm fixed-price contract shifts cost overrun risk to the contractor.
Awarded by the Defense Logistics Agency, indicating a focus on essential supply chain needs.
The contract falls under a standard manufacturing category (NAICS 315220).

Sector Analysis

The Men's and Boys' Cut and Sew Apparel Manufacturing sector (NAICS 315220) encompasses establishments primarily engaged in manufacturing men's and boys' cut and sew apparel from purchased fabric. This sector includes a wide range of garments. Federal spending in this area typically supports military uniforms, specialized workwear, and other government-specific apparel needs. The Defense Logistics Agency, as the procuring agency, is a significant player in this market, ensuring the supply of clothing for service members. Benchmarking this specific contract's value is challenging without knowing the exact items procured, but the scale suggests a substantial order.

Small Business Impact

There is no indication that this contract included a small business set-aside, as the 'ss' and 'sb' fields are false. The contract value is substantial, suggesting it was likely awarded to a larger prime contractor. There is no information provided regarding subcontracting plans or goals, making it difficult to assess the potential impact on the small business ecosystem. Without specific subcontracting requirements, small businesses may not directly benefit from this particular award.

Oversight & Accountability

The contract is a Definitive Contract, which implies a more formal and structured agreement than some other contract types. Oversight would typically be managed by the Defense Logistics Agency (DLA) contracting officers and quality assurance personnel. Accountability measures would be tied to the terms of the Firm Fixed Price agreement, including delivery schedules and quality standards. Transparency is facilitated by the Federal Procurement Data System (FPDS), where this data is reported. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Logistics Agency Clothing and Textiles
Military Uniform Procurement
Department of Defense Apparel Contracts
Men's and Boys' Apparel Manufacturing Contracts

Risk Flags

High value for short duration
Limited competition justification unclear
Lack of detailed product specification
Potential for overpayment due to limited competition

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $27.6 million to THE SPECIALIZED COMPANY FOR TRADE SERVICES. 8502561125!14 YEAR OLD

Who is the contractor on this award?

The obligated recipient is THE SPECIALIZED COMPANY FOR TRADE SERVICES.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $27.6 million.

What is the period of performance?

Start: 2015-09-29. End: 2015-11-30.

What specific types of apparel were procured under this $276 million contract?

The provided data indicates the contract falls under NAICS code 315220, 'Men’s and Boys’ Cut and Sew Apparel Manufacturing.' However, it does not specify the exact items. Given the procuring agency is the Defense Logistics Agency (DLA) and the awardee is 'THE SPECIALIZED COMPANY FOR TRADE SERVICES,' it is highly probable that the contract was for military uniforms, combat clothing, or other specialized apparel required by the Department of Defense. The large dollar amount suggests a significant quantity or high-value items. Without more granular data, such as product service codes (PSC) or detailed line item descriptions, the precise nature of the apparel remains unspecified.

How does the $4.45 million average daily cost compare to industry benchmarks for apparel manufacturing?

Directly comparing the $4.45 million average daily cost to industry benchmarks for apparel manufacturing is challenging without knowing the specific items procured. Apparel manufacturing costs vary widely based on material, complexity, labor, and volume. For a 62-day contract, this daily expenditure is exceptionally high. Typical apparel manufacturing contracts, even for large volumes, often do not reach such daily figures unless they involve highly specialized, technologically advanced, or extremely labor-intensive production runs. This high daily cost suggests either an extremely large volume of standard items, a very complex or specialized item, or potentially an inflated price relative to the market for the specific goods delivered within that short timeframe.

What were the specific reasons for excluding other sources in this 'full and open competition after exclusion of sources' award?

The data provided states the contract type as 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' but does not detail the specific reasons for excluding other sources. This procurement method typically involves a justification, such as national security concerns, specific technological requirements, or prior performance issues with other potential contractors, that necessitates limiting the pool of eligible bidders. Without access to the contract's justification and approval (J&A) document or other procurement narratives, the rationale behind the exclusion remains unknown. Understanding these reasons is crucial for assessing whether the exclusion was appropriate and if it potentially limited competition unfairly, impacting the final price.

What is the track record of 'THE SPECIALIZED COMPANY FOR TRADE SERVICES' with federal contracts, particularly with the Department of Defense?

The provided data identifies 'THE SPECIALIZED COMPANY FOR TRADE SERVICES' as the contractor with a contract value of $276,349,000. However, it does not offer details on their historical performance, past contracts, or track record with the federal government, specifically the Department of Defense. To assess their reliability and past performance, one would need to consult additional databases like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS). A review of past performance would help determine if they have a history of successful contract completion, on-time delivery, and adherence to quality standards, which is essential for a contract of this magnitude.

Given the short 62-day duration, what was the likely scope of work and urgency driving this contract?

A contract valued at $276 million with a performance period of only 62 days (approximately two months) suggests a highly urgent or time-sensitive requirement. The scope of work was likely focused on the rapid production and delivery of a large quantity of specific apparel items. This could be driven by immediate operational needs, deployment schedules, or a critical shortage of existing inventory. The firm fixed-price nature further implies that the government sought to lock in a price for a defined output within a tight timeframe, transferring the risk of timely execution to the contractor. The urgency might also explain the 'exclusion of sources' if specific capabilities were needed immediately from a known provider.

How does the award date (2015-09-29) and performance end date (2015-11-30) align with typical military apparel procurement cycles?

The award date of September 29, 2015, and the performance end date of November 30, 2015, indicate a contract executed within the first fiscal quarter of FY2016. This timeframe is relatively short for fulfilling a large apparel order. Military apparel procurement cycles can vary significantly depending on the item, lead times for manufacturing, and seasonal demands. However, a two-month window for a contract of this value suggests either a pre-existing production capability ready for immediate deployment or a focus on fulfilling an urgent, short-term need rather than a standard, long-term supply requirement. It might also reflect a rapid response to an unforeseen demand.

Industry Classification

NAICS: Manufacturing › Cut and Sew Apparel Manufacturing › Men’s and Boys’ Cut and Sew Apparel Manufacturing

Product/Service Code: CLOTHING, INDIVIDUAL EQUIPMENT, INSIGNA, AND JEWELRY

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: AL-HASSAN INDUSTRIAL ESTATE, IRBID

Business Categories: Category Business, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $27,634,900

Exercised Options: $27,634,900

Current Obligation: $27,634,900

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Timeline