DoD's $17.3M Ordnance Contract with Gayston Corporation: A Deep Dive into Value and Competition

Contract Overview

Contract Amount: $17,348,049 ($17.3M)

Contractor: Gayston Corporation

Awarding Agency: Department of Defense

Start Date: 2008-11-07

End Date: 2014-01-31

Contract Duration: 1,911 days

Daily Burn Rate: $9.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: M24 FIN

Place of Performance

Location: SPRINGBORO, WARREN County, OHIO, 45066

State: Ohio Government Spending

Plain-Language Summary

Department of Defense obligated $17.3 million to GAYSTON CORPORATION for work described as: M24 FIN Key points: 1. Analysis indicates a fair value proposition, with pricing appearing reasonable relative to contract scope. 2. The contract was awarded under full and open competition, suggesting a competitive bidding process. 3. Risk indicators are moderate, with no immediate red flags identified in the contract terms. 4. Performance context is limited, but the contract duration suggests a sustained need for ordnance supplies. 5. The contract falls within the Defense sector, specifically supporting ordnance manufacturing. 6. Gayston Corporation's role in this contract highlights its position within the defense supply chain.

Value Assessment

Rating: fair

The contract's total value of approximately $17.3 million over its period of performance suggests a moderate investment. Benchmarking against similar ordnance manufacturing contracts is challenging without more specific service details. However, the firm fixed-price structure generally provides cost certainty. The pricing appears to be within a reasonable range for the type of goods procured, assuming standard quality and delivery requirements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while competition was sought, specific sources may have been excluded for defined reasons. The presence of multiple bidders (4 indicated) suggests a degree of market interest. The level of competition, while not entirely unrestricted, likely contributed to price discovery and a competitive award.

Taxpayer Impact: The competitive nature of this award, even with exclusions, suggests that taxpayer funds were likely used efficiently, as multiple firms vied for the contract, potentially driving down costs.

Public Impact

The Department of the Army benefits from a reliable supply of ordnance accessories. Services delivered include the manufacturing and provision of specific ordnance components. The geographic impact is primarily centered around the contractor's facility in Ohio. Workforce implications include job creation and maintenance within the defense manufacturing sector in Ohio.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions if Gayston Corporation faces production issues.
Reliance on a single contractor for specific ordnance components could pose a risk.
The 'Exclusion of Sources' clause warrants further investigation into the rationale behind excluding certain bidders.

Positive Signals

Firm Fixed Price contract provides cost predictability for the Department of Defense.
The contract duration of over 1900 days indicates a stable, long-term requirement.
Award to an established company like Gayston Corporation suggests a degree of reliability.

Sector Analysis

This contract falls within the Defense Industrial Base sector, specifically focusing on the manufacturing of ordnance and accessories. The market for such components is specialized and driven by government procurement. Comparable spending benchmarks would typically involve analyzing other contracts for similar military hardware. The size of this contract is moderate within the broader defense procurement landscape.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, and the contractor, Gayston Corporation, is likely not a small business given the contract value. There is no explicit information on subcontracting plans for small businesses within this data, suggesting potential limited direct impact on the small business ecosystem for this specific award.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are embedded in the firm fixed-price structure, requiring delivery of goods as specified. Transparency is generally maintained through contract award databases, though specific performance metrics and oversight reports may not be publicly detailed.

Related Government Programs

Department of Defense Ordnance Procurement
Ordnance and Accessories Manufacturing Contracts
Defense Supply Chain Management
Federal Firm Fixed Price Contracts

Risk Flags

Competition potentially limited by 'Exclusion of Sources'
Reliance on a single contractor for specific components
Potential for supply chain vulnerabilities in defense manufacturing

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.3 million to GAYSTON CORPORATION. M24 FIN

Who is the contractor on this award?

The obligated recipient is GAYSTON CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $17.3 million.

What is the period of performance?

Start: 2008-11-07. End: 2014-01-31.

What is Gayston Corporation's track record with the Department of Defense?

Gayston Corporation has a history of contracting with the Department of Defense, as evidenced by this award. While this specific contract is for 'Other Ordnance and Accessories Manufacturing,' their broader portfolio may include other defense-related goods or services. A comprehensive review would involve examining past performance evaluations, other awarded contracts, and any documented issues or successes in fulfilling previous DoD requirements. The duration and value of this contract suggest a level of established performance and trust between the contractor and the agency.

How does the value of this contract compare to similar ordnance supply contracts?

Direct comparison of this $17.3 million contract to similar ordnance supply contracts is challenging without granular data on the specific types of ordnance and accessories procured, their quantities, and the contract duration. However, the contract's value over approximately 1911 days (around 5.2 years) indicates an average annual value of roughly $3.3 million. This figure can be benchmarked against other DoD contracts for similar defense materiel. The firm fixed-price nature suggests a focus on cost certainty for the government, which is a common objective in such procurements.

What are the primary risks associated with this contract?

The primary risks associated with this contract include potential supply chain disruptions, as the manufacturing of specialized ordnance components can be complex and subject to material availability. There's also a risk related to the 'Exclusion of Sources' aspect of the competition, which, if not properly justified, could indicate a less competitive environment than ideal. Furthermore, ensuring consistent quality and timely delivery of ordnance accessories is critical for military readiness, and any failures in these areas would represent a significant risk to the Department of the Army's operational capabilities.

How effective is the firm fixed-price (FFP) contract type in managing costs for ordnance?

The Firm Fixed Price (FFP) contract type is generally considered effective for managing costs when the scope of work is well-defined and the risks of performance are relatively low or can be reasonably estimated. For ordnance manufacturing, where specifications are often precise, FFP provides the government with cost predictability and shifts the risk of cost overruns to the contractor. This encourages the contractor to manage their own costs efficiently to maximize profit. However, if unforeseen technical challenges arise or material costs fluctuate significantly, the contractor may face difficulties, potentially impacting delivery or quality if not managed proactively.

What are the historical spending patterns for 'Other Ordnance and Accessories Manufacturing' by the Department of the Army?

Historical spending patterns for 'Other Ordnance and Accessories Manufacturing' by the Department of the Army are substantial, reflecting the ongoing need for a wide array of military equipment. This specific contract, valued at $17.3 million, represents a portion of that broader spending. Analyzing historical data would reveal trends in contract values, types of ordnance procured, key contractors, and fluctuations in spending based on defense priorities and budget allocations. Such analysis helps in understanding the market dynamics and the government's long-term investment in this category.

Industry Classification

NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Other Ordnance and Accessories Manufacturing

Product/Service Code: AMMUNITION AND EXPLOSIVES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W15QKN08R0338

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 200 S PIONEER BLVD, SPRINGBORO, OH, 01

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $17,348,049

Exercised Options: $17,348,049

Current Obligation: $17,348,049

Contract Characteristics

Cost or Pricing Data: NO

Timeline