DoD's $11.9M logistics consulting contract awarded to VALKOS CORPORATION shows strong competition and firm fixed pricing

Contract Overview

Contract Amount: $11,928,651 ($11.9M)

Contractor: Valkos Corporation

Awarding Agency: Department of Defense

Start Date: 2023-09-19

End Date: 2026-09-30

Contract Duration: 1,107 days

Daily Burn Rate: $10.8K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 19

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMET

Place of Performance

Location: FORT BRAGG, CUMBERLAND County, NORTH CAROLINA, 28310

State: North Carolina Government Spending

Plain-Language Summary

Department of Defense obligated $11.9 million to VALKOS CORPORATION for work described as: COMET Key points: 1. The contract leverages a firm fixed-price structure, aligning contractor incentives with efficient service delivery. 2. With 19 bids received, the procurement process indicates robust market interest and competitive dynamics. 3. The definitive contract award suggests a need for ongoing, flexible logistics support services. 4. The contractor, VALKOS CORPORATION, is positioned to deliver specialized consulting in process, physical distribution, and logistics. 5. The contract duration of 1107 days points to a significant, long-term engagement. 6. The award was made under full and open competition after exclusion of sources, ensuring a broad range of potential bidders.

Value Assessment

Rating: good

Benchmarking the value of this $11.9 million contract requires detailed cost breakdowns not publicly available. However, the firm fixed-price (FFP) award structure is generally favorable for the government, as it shifts cost overrun risks to the contractor. The presence of 19 bids suggests a competitive environment that likely drove a reasonable price. Further analysis would involve comparing the per-unit costs of specific consulting hours or deliverables against industry standards and similar government contracts for logistics consulting services.

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 the competition was broad, specific sources may have been initially excluded before the final solicitation. The receipt of 19 bids demonstrates a healthy level of competition, suggesting that multiple firms were interested and capable of performing the required logistics consulting services. This level of competition is generally positive for price discovery and ensures the government receives offers from a diverse pool of qualified contractors.

Taxpayer Impact: A high number of bidders typically leads to more competitive pricing, potentially saving taxpayer dollars by driving down the cost of services. It also increases the likelihood that the most capable and cost-effective solution is selected.

Public Impact

The Department of the Army benefits from enhanced logistics and distribution process consulting. Services delivered are expected to optimize physical distribution and overall supply chain efficiency. The contract's geographic impact is primarily focused on supporting Department of Defense operations, with potential implications for its North Carolina facilities. Workforce implications may include the engagement of specialized logistics consultants, potentially leading to knowledge transfer and improved internal capabilities within the Army.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if initial requirements are not clearly defined, leading to cost increases.
Dependence on contractor expertise could limit internal knowledge development if not managed proactively.
Ensuring consistent quality and performance across the contract duration requires robust oversight.

Positive Signals

Firm fixed-price contract structure incentivizes cost control and efficiency.
Extensive competition (19 bids) suggests a strong market offering and likely competitive pricing.
Award to a single contractor for a defined period allows for focused expertise and relationship building.

Sector Analysis

The logistics consulting sector is a critical component of the broader professional services market supporting government operations. This contract falls under NAICS code 541614 (Process, Physical Distribution, and Logistics Consulting Services). The market for these services is competitive, with numerous firms offering specialized expertise. Government spending in this area is driven by the need to optimize complex supply chains, improve efficiency, and reduce costs, particularly within large organizations like the Department of Defense. Comparable spending benchmarks would involve analyzing other large-scale logistics consulting contracts awarded by federal agencies.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The award was made under full and open competition. While there is no direct set-aside, the prime contractor, VALKOS CORPORATION, may engage small businesses as subcontractors. The extent of subcontracting to small businesses is not detailed in the provided data, but it represents a potential avenue for small business participation in supporting this large federal contract.

Oversight & Accountability

The contract is a Definitive Contract, which typically involves detailed terms and conditions. Oversight mechanisms would likely include regular performance reviews, milestone tracking, and quality assurance checks managed by the contracting officer and technical representatives within the Department of the Army. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

Department of Defense Logistics Modernization Programs
Army Supply Chain Management Initiatives
Federal Supply Chain Optimization Contracts
Professional Services Contracts for Government Agencies

Risk Flags

Potential for undefined scope leading to cost overruns.
Contractor performance variability over the contract duration.
Justification for 'exclusion of sources' requires scrutiny to ensure maximum competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.9 million to VALKOS CORPORATION. COMET

Who is the contractor on this award?

The obligated recipient is VALKOS 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 $11.9 million.

What is the period of performance?

Start: 2023-09-19. End: 2026-09-30.

What is the track record of VALKOS CORPORATION in performing similar federal contracts, particularly within the Department of Defense?

VALKOS CORPORATION has a history of performing federal contracts, though specific details on past performance for similar logistics consulting services within the Department of Defense require deeper database analysis. Examining their contract history, past performance evaluations, and any reported issues or successes on previous engagements would provide a clearer picture of their capabilities and reliability. Understanding their experience with firm fixed-price contracts and the scale of previous projects is crucial for assessing their suitability for this $11.9 million award. A review of their contract awards and terminations, along with any debriefings or protests, would offer further insights into their performance.

How does the awarded price compare to industry benchmarks for logistics consulting services of this scope?

Directly comparing the awarded price of $11.9 million to industry benchmarks is challenging without detailed cost breakdowns or specific service deliverables. However, the firm fixed-price (FFP) nature of the contract and the high number of bidders (19) suggest a competitive pricing environment. To benchmark effectively, one would need to analyze the average hourly rates or project fees for similar logistics consulting engagements provided to large organizations, considering factors like the complexity of the services, the duration of the contract, and the specific expertise required. Government databases and industry reports on professional services pricing can offer comparative data points.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks include potential scope creep, where the project's requirements expand beyond the initial agreement, leading to cost overruns or schedule delays. Another risk is the contractor's ability to deliver the promised expertise consistently over the contract's duration. Mitigation strategies likely involve robust contract management by the Department of the Army, including clear definition of deliverables, regular performance reviews, and change control processes. The firm fixed-price structure itself mitigates financial risk for the government regarding cost overruns. Ensuring the contractor maintains adequate staffing and expertise throughout the period of performance is also critical.

How effective is the 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' approach in ensuring value for taxpayers?

The 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' approach aims to balance broad competition with the need to potentially exclude sources that may not meet specific, justifiable criteria. While 'full and open' competition is generally ideal for maximizing value, the 'after exclusion of sources' clause suggests that certain potential bidders were not considered from the outset. The effectiveness for taxpayers hinges on whether the exclusions were well-justified and did not unduly limit competition. The fact that 19 bids were received indicates that sufficient competition likely remained, which is positive for price discovery and value. However, a review of the justification for excluding sources would be necessary for a complete assessment.

What is the historical spending trend for logistics consulting services within the Department of the Army?

Analyzing historical spending trends for logistics consulting within the Department of the Army requires access to comprehensive federal procurement data over several fiscal years. Such an analysis would reveal patterns in contract awards, average contract values, and the types of services procured. Understanding these trends helps contextualize the current $11.9 million award, indicating whether it represents an increase, decrease, or stable level of investment in logistics consulting. It also helps identify key contractors and the evolution of service needs within the Army's logistics domain.

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) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W9124722R0017

Offers Received: 19

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11015 DORMIE DR, SAN ANTONIO, FL, 33576

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Service Disabled Veteran Owned Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business, Veteran Owned Business

Financial Breakdown

Contract Ceiling: $18,509,956

Exercised Options: $13,784,825

Current Obligation: $11,928,651

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline