DoD Navy Spends $26.4M on Laptops via Full & Open Competition, Raising Value Questions
Contract Overview
Contract Amount: $26,446,300 ($26.4M)
Contractor: CDW Government LLC
Awarding Agency: Department of Defense
Start Date: 2015-06-25
End Date: 2021-05-05
Contract Duration: 2,141 days
Daily Burn Rate: $12.4K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: GENERAL PURPOSE LAPTOP
Place of Performance
Location: VERNON HILLS, LAKE County, ILLINOIS, 60061
State: Illinois Government Spending
Plain-Language Summary
Department of Defense obligated $26.4 million to CDW GOVERNMENT LLC for work described as: GENERAL PURPOSE LAPTOP Key points: 1. Significant spending on a common commodity like laptops warrants scrutiny. 2. Competition was full and open, but pricing effectiveness is unclear. 3. Long contract duration (2015-2021) may not reflect current market prices. 4. Sector context for IT hardware procurement is crucial for benchmarking.
Value Assessment
Rating: questionable
The contract value of $26.4 million for general-purpose laptops over six years is substantial. Without specific unit pricing or comparison data, it's difficult to assess if this represents good value, especially considering the rapid evolution of laptop technology and potential for bulk discounts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating a broad market solicitation. However, the impact on price discovery is uncertain without knowing the number of bids received and the final negotiated prices relative to market rates.
Taxpayer Impact: Taxpayer funds were used for a large procurement of standard IT equipment. Ensuring competitive pricing is essential to maximize the value of these expenditures.
Public Impact
Procurement of essential IT hardware impacts operational readiness across Navy units. The long duration of the contract could mean the Navy received outdated technology or paid above market rates towards the end of the period. Transparency in pricing for commodity items like laptops is important for public trust.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of specific unit cost data makes value assessment difficult.
- Long contract duration may lead to suboptimal pricing.
- Potential for technology obsolescence over the contract period.
Positive Signals
- Awarded under full and open competition.
- Contract type is firm fixed price, providing cost certainty.
Sector Analysis
Information Technology hardware procurement is a significant area of government spending. Benchmarking laptop costs against industry standards and other government contracts is vital to ensure fiscal responsibility and avoid overpayment for commodity items.
Small Business Impact
While the contract was awarded under full and open competition, it's unclear if small businesses were significantly involved or benefited. Large IT hardware contracts often favor major distributors, potentially limiting small business participation.
Oversight & Accountability
The contract was a delivery order under a larger contract, suggesting some level of pre-competed framework. Oversight would focus on ensuring the delivery order process adhered to the original contract terms and competitive procedures.
Related Government Programs
- Electronic Computer Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of unit cost data.
- Long contract duration.
- Potential for technology obsolescence.
- Unclear impact of competition on price.
- Commodity item procurement warrants close value analysis.
Tags
electronic-computer-manufacturing, department-of-defense, il, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $26.4 million to CDW GOVERNMENT LLC. GENERAL PURPOSE LAPTOP
Who is the contractor on this award?
The obligated recipient is CDW GOVERNMENT LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $26.4 million.
What is the period of performance?
Start: 2015-06-25. End: 2021-05-05.
What was the average per-unit cost of the laptops procured under this contract, and how does it compare to prevailing market prices during the contract period?
The provided data does not include the average per-unit cost. To assess value, a detailed analysis comparing the negotiated unit prices against GSA schedules, commercial price lists, and other government contracts for similar laptop models during the 2015-2021 period would be necessary. This comparison is crucial for determining if taxpayers received a fair price.
Given the six-year duration, what mechanisms were in place to mitigate the risk of technology obsolescence and ensure the Navy received up-to-date hardware?
The contract's long duration (2015-2021) presents a significant risk of technology obsolescence. Without specific contract clauses addressing technology refresh cycles or phased upgrades, it's possible the Navy acquired hardware that became outdated. Further review of the contract's specific terms and conditions is needed to understand any mitigation strategies employed.
How effectively did the full and open competition process ensure competitive pricing for these general-purpose laptops?
While 'full and open competition' suggests a broad solicitation, its effectiveness in ensuring competitive pricing depends on factors not detailed here, such as the number of bids received, the specific requirements, and the evaluation criteria. A large number of bids from qualified vendors typically leads to better price discovery. The final negotiated price against market benchmarks would be the ultimate indicator of effectiveness.
Industry Classification
NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: M6785415Q4045
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: CDW Corporation (UEI: 808068253)
Address: 230 N MILWAUKEE AVE, VERNON HILLS, IL, 60061
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $26,446,300
Exercised Options: $26,446,300
Current Obligation: $26,446,300
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: M6785412D4153
IDV Type: IDC
Timeline
Start Date: 2015-06-25
Current End Date: 2021-05-05
Potential End Date: 2021-05-05 00:00:00
Last Modified: 2021-05-25
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