DoD's $82.7M logistics consulting contract with S&K Aerospace shows strong competition and long duration

Contract Overview

Contract Amount: $82,667,259 ($82.7M)

Contractor: S & K Aerospace, LLC

Awarding Agency: Department of Defense

Start Date: 2012-03-15

End Date: 2022-03-14

Contract Duration: 3,651 days

Daily Burn Rate: $22.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: IGF::CL::IGF PROS IV

Place of Performance

Location: WARNER ROBINS, HOUSTON County, GEORGIA, 31088

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $82.7 million to S & K AEROSPACE, LLC for work described as: IGF::CL::IGF PROS IV Key points: 1. Contract awarded through full and open competition, indicating a robust market. 2. Long contract duration of over 10 years suggests a sustained need for services. 3. Fixed-price contract type generally shifts risk to the contractor. 4. The contract's value is significant, reflecting substantial requirements. 5. Logistics consulting services are critical for efficient military operations. 6. The award to S&K Aerospace, LLC, represents a key supplier relationship for the Air Force.

Value Assessment

Rating: good

The total award of $82.7 million over more than 10 years averages to approximately $8 million annually. Benchmarking this against similar large-scale logistics consulting contracts is challenging without more specific service details. However, the fixed-price nature of the contract suggests that the government has a clear understanding of the expected costs, and the contractor bears the risk of cost overruns. The consistent performance over a decade implies a stable and potentially competitive pricing structure was established.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit offers. With 5 bids received, the competition level appears healthy, suggesting that multiple firms were interested and capable of providing the required logistics consulting services. This level of competition is generally favorable for price discovery and can lead to more competitive pricing for the government.

Taxpayer Impact: A competitive bidding process for this contract likely resulted in a better price for taxpayers compared to a sole-source or limited competition award. The presence of multiple bidders indicates that taxpayer funds were used efficiently by leveraging market forces.

Public Impact

The Department of the Air Force benefits from enhanced logistics planning and execution. Services provided likely improve the efficiency and cost-effectiveness of supply chains. The contract supports critical military readiness and operational capabilities. Workforce implications include potential employment for logistics consultants and analysts. Geographic impact is likely concentrated where Air Force logistics operations are managed, primarily in Georgia (ST='GA').

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to vendor lock-in if not managed carefully.
Reliance on a single contractor for over a decade might reduce future competitive pressure.
Scope creep could be a risk if not managed through rigorous oversight.
Potential for knowledge transfer limitations if key personnel depart.

Positive Signals

Award through full and open competition suggests a strong initial vetting of capabilities.
Fixed-price contract type aligns incentives and controls costs.
Sustained award over 10 years indicates consistent satisfaction with performance.
The number of bids (5) suggests a competitive market for these services.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically focusing on logistics consulting. This sector is vital for government operations, enabling efficient management of complex supply chains and operational support. The market for logistics consulting is competitive, with numerous firms offering specialized expertise. The Department of Defense is a significant consumer of such services, often requiring highly specialized knowledge due to the scale and complexity of its global operations. Comparable spending benchmarks would depend on the specific nature of the consulting services, but large-scale, long-term contracts like this are common for major federal agencies.

Small Business Impact

The data indicates this contract was not set aside for small businesses (SS=false, SB=false). The prime contractor, S&K AEROSPACE, LLC, is likely a large business. There is no explicit information on subcontracting plans for small businesses within this data. Without specific subcontracting goals or reporting, the direct impact on the small business ecosystem is unclear, though large prime contracts often involve some level of subcontracting.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within the Department of the Air Force. Performance reviews, regular reporting requirements, and adherence to the fixed-price terms are key accountability measures. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Logistics Support Services
Management and Financial Consulting, Acquisition and Grants Management Support
Defense Logistics Agency Contracts
Air Mobility Command Support Contracts
Supply Chain Management Consulting

Risk Flags

Long contract duration may require re-evaluation of scope and relevance.
Potential for vendor lock-in due to extended performance period.
Need for robust oversight to manage fixed-price contract effectively over time.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $82.7 million to S & K AEROSPACE, LLC. IGF::CL::IGF PROS IV

Who is the contractor on this award?

The obligated recipient is S & K AEROSPACE, LLC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $82.7 million.

What is the period of performance?

Start: 2012-03-15. End: 2022-03-14.

What is the specific nature of the 'Process, Physical Distribution, and Logistics Consulting Services' provided under this contract?

The provided data classifies the service under NAICS code 541614, 'Process, Physical Distribution, and Logistics Consulting Services.' This typically involves advising organizations on how to improve their logistics operations, including supply chain management, inventory control, warehousing, transportation, and distribution strategies. For the Department of the Air Force, this could encompass optimizing the movement of personnel, equipment, and supplies, enhancing readiness, reducing operational costs, and improving the efficiency of global logistics networks. The exact scope would be detailed in the contract's Statement of Work (SOW), which is not provided here but would outline specific deliverables, methodologies, and performance metrics.

How does the $82.7 million total award compare to other similar logistics consulting contracts within the Department of Defense?

Direct comparison of the $82.7 million total award requires access to a broader dataset of similar contracts, including their scope, duration, and specific services. However, for a contract spanning over 10 years (3651 days) awarded through full and open competition with 5 bidders, this value appears substantial, reflecting a significant and ongoing need for logistics expertise within the Air Force. Large-scale, long-term contracts for specialized consulting services are common within the DoD, given the complexity and scale of its operations. Without more granular data on comparable contracts, it's difficult to definitively state if this represents a high, low, or average value, but it signifies a major investment in logistics optimization.

What are the primary risks associated with a contract of this duration (over 10 years)?

A primary risk with a contract lasting over 10 years is the potential for technological obsolescence or changes in operational requirements that could make the original scope of services less relevant or efficient. Another significant risk is vendor lock-in, where the government becomes overly reliant on a single contractor, potentially diminishing future competitive leverage and innovation. There's also the risk of 'scope creep' if contract modifications are not rigorously managed, leading to increased costs. Furthermore, maintaining consistent performance and quality over such an extended period requires robust oversight and contractor accountability mechanisms to ensure ongoing value.

What does the 'FIRM FIXED PRICE' contract type imply about cost control and risk allocation?

A 'FIRM FIXED PRICE' (FFP) contract type implies that the contractor, S&K AEROSPACE, LLC, is obligated to perform the work for a stated price, regardless of the actual costs incurred. This shifts the primary cost risk from the government to the contractor. If the contractor's costs exceed the fixed price, their profit margin decreases or they may incur a loss. Conversely, if their costs are lower than anticipated, their profit increases. This contract type is generally favored by the government when the scope of work is well-defined and stable, as it provides the most certainty regarding final cost and encourages contractor efficiency.

How has spending on logistics consulting services by the Department of the Air Force trended historically?

Historical spending trends for logistics consulting services by the Department of the Air Force are not directly available from the provided data snippet. This data point represents a single contract award. To analyze historical trends, one would need to aggregate spending data for similar NAICS codes (like 541614) and contract types across multiple fiscal years for the Air Force. Such an analysis could reveal whether spending in this area has increased, decreased, or remained stable, potentially influenced by strategic priorities, budget allocations, or shifts towards in-house capabilities versus contracted services.

What is the significance of the 'GA' (Georgia) state code associated with this contract?

The 'GA' state code likely indicates the primary place of performance or the location of the contractor's office relevant to this contract. For the Department of the Air Force, this could mean that the logistics consulting services are being performed at a base or facility located in Georgia, or that S&K AEROSPACE, LLC has a significant operational presence there related to this contract. This information can be useful for understanding regional economic impact and the geographic distribution of federal contracting activities.

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

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: FA863010R5018

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 63066 OLD HWY 93, SAINT IGNATIUS, MT, 59865

Business Categories: 8(a) Program Participant, Category Business, Labor Surplus Area Firm, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Not Designated a Small Business, Self-Certified Small Disadvantaged Business, Small Business, Small Disadvantaged Business, Special Designations, Tribally Owned Firm, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $1,636,000,000

Exercised Options: $1,636,000,000

Current Obligation: $82,667,259

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: FA863012D5018

IDV Type: IDC

Timeline