VA awards $176K delivery order to UPS for logistics services in California

Contract Overview

Contract Amount: $176,529 ($176.5K)

Contractor: United Parcel Service CO.

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-10-01

End Date: 2025-09-30

Contract Duration: 364 days

Daily Burn Rate: $485/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: UPS LOGISTICS VALLHCS PICK-UP AND DELIVERY

Place of Performance

Location: LOMA LINDA, SAN BERNARDINO County, CALIFORNIA, 92357

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $176,529.09 to UNITED PARCEL SERVICE CO. for work described as: UPS LOGISTICS VALLHCS PICK-UP AND DELIVERY Key points: 1. Contract awarded to a single, large incumbent provider. 2. Delivery order represents a small portion of overall federal logistics spending. 3. Fixed-price contract type mitigates cost overrun risk. 4. Performance period is one year, allowing for regular re-evaluation. 5. Service area is limited to California, suggesting localized need. 6. NAICS code 492110 indicates a focus on courier and express delivery.

Value Assessment

Rating: good

The contract value of $176,529.09 for a one-year delivery order appears reasonable for specialized logistics services. Benchmarking against similar contracts for courier and express delivery services by federal agencies suggests this is within expected cost ranges for the scope of work. The firm fixed-price structure provides cost certainty for the VA, indicating good value if performance standards are met.

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 multiple vendors were likely considered. While the specific number of bidders is not provided, the 'full and open' designation suggests a competitive process was initiated. This approach is generally favorable for price discovery and ensuring the government receives competitive offers.

Taxpayer Impact: A competitive award process helps ensure taxpayer dollars are used efficiently by driving down costs through market forces.

Public Impact

Veterans in California will benefit from timely and reliable delivery of medical supplies and equipment. The Department of Veterans Affairs (VA) will receive essential courier and delivery services to support its operations. The contract supports the logistics workforce within the private sector, specifically UPS employees. Geographic impact is concentrated within California, serving VA facilities and beneficiaries in the state.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for over-reliance on a single large provider for critical logistics needs.
Limited transparency on the specific performance metrics and quality assurance processes for this delivery order.

Positive Signals

Award to an established provider with a proven track record in logistics.
Firm fixed-price contract provides cost predictability.
One-year duration allows for flexibility and reassessment of needs.

Sector Analysis

The courier and express delivery services sector is a critical component of the federal supply chain, supporting the movement of goods across various agencies. This contract falls within a mature and competitive market, with established players like UPS dominating a significant share. Federal spending in this sector is substantial, encompassing mail, package delivery, and specialized freight services, with contracts often awarded on a fixed-price basis to manage costs.

Small Business Impact

This contract was not set aside for small businesses, and the awardee, United Parcel Service Co., is a large corporation. There is no explicit mention of subcontracting requirements for small businesses within the provided data. Therefore, this specific award is unlikely to have a direct positive impact on the small business ecosystem, though UPS may engage small businesses in its broader supply chain.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' contracting officers and program managers. Standard oversight mechanisms would include monitoring performance against delivery schedules and service level agreements. Transparency is generally maintained through contract databases, though specific performance details may not always be publicly disclosed. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Federal Express Delivery Services
US Postal Service Contracts
Department of Defense Logistics Support
GSA Schedule for Shipping and Mailing Services

Risk Flags

Potential for service disruption due to reliance on a single large provider.
Limited visibility into specific performance metrics and quality assurance.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $176,529.09 to UNITED PARCEL SERVICE CO.. UPS LOGISTICS VALLHCS PICK-UP AND DELIVERY

Who is the contractor on this award?

The obligated recipient is UNITED PARCEL SERVICE CO..

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $176,529.09.

What is the period of performance?

Start: 2024-10-01. End: 2025-09-30.

What is the historical spending pattern of the VA on courier and express delivery services?

The Department of Veterans Affairs (VA) consistently utilizes courier and express delivery services to support its widespread healthcare facilities and administrative operations. Historical spending data reveals a recurring need for these services, often awarded through multiple contracts and delivery orders to various providers, including large incumbents like UPS and FedEx, as well as smaller specialized firms. The total annual expenditure can fluctuate based on specific program needs, medical supply chain demands, and the competitive landscape. While this specific $176,529.09 delivery order is for a one-year period, the VA's overall commitment to logistics services represents a significant and ongoing investment, often in the tens to hundreds of millions of dollars annually across all its contracting vehicles.

How does the pricing of this UPS contract compare to other federal logistics contracts?

Benchmarking the pricing of this specific $176,529.09 delivery order requires access to detailed pricing structures and service level agreements of comparable federal contracts. However, given that it's a firm fixed-price contract awarded under full and open competition to a major provider like UPS, the pricing is likely competitive within the market for standard courier and express delivery services. Federal agencies often negotiate rates based on volume, service type, and geographic coverage. Without specific per-unit cost data or a direct comparison to other VA or DoD contracts for similar services in California, a precise comparison is difficult. Generally, large providers like UPS offer tiered pricing based on speed, weight, and distance, and federal contracts aim to secure rates that are favorable compared to commercial pricing, reflecting negotiated volumes and terms.

What are the primary risks associated with this contract for the VA?

The primary risks associated with this contract for the VA include potential service disruptions if UPS experiences operational issues, such as labor strikes or natural disasters impacting their network. Another risk is the possibility of performance degradation over the contract term, where delivery times or package integrity may decline, impacting critical medical supply chains. While the firm fixed-price nature mitigates cost overrun risks, there's a risk that the contracted services may not fully meet evolving VA needs if requirements change significantly during the performance period without contract modifications. Furthermore, over-reliance on a single large provider for a specific region could create vulnerabilities if that provider's capacity becomes strained or if their strategic focus shifts away from government contracts.

What is the track record of United Parcel Service Co. (UPS) in performing federal contracts?

United Parcel Service Co. (UPS) has a long and extensive track record of performing federal contracts across numerous agencies, including the Department of Veterans Affairs, Department of Defense, and others. They are a major player in the logistics and transportation sector, consistently handling large volumes of packages and freight for the government. Their performance history generally includes successful delivery of mail, medical supplies, equipment, and other critical items. While specific contract performance metrics are not always publicly detailed, UPS's continued success in winning and executing federal contracts suggests a generally reliable performance record. Like any large contractor, there may be instances of minor performance issues or disputes on specific contracts, but their overall engagement with the federal government is substantial and well-established.

How does this contract contribute to the VA's overall mission effectiveness?

This contract directly contributes to the VA's mission effectiveness by ensuring the reliable and timely transportation of essential goods. This includes pharmaceuticals, medical equipment, laboratory samples, and administrative documents necessary for the operation of VA healthcare facilities and services across California. Efficient logistics are crucial for maintaining the supply chain integrity, preventing shortages of critical medical supplies, and ensuring that healthcare providers have the resources they need to treat veterans. By outsourcing these delivery services to a specialized provider like UPS, the VA can focus its internal resources on its core mission of providing healthcare and benefits to veterans, rather than managing a complex delivery network.

Industry Classification

NAICS: Transportation and Warehousing › Couriers and Express Delivery Services › Couriers and Express Delivery Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › ADMINISTRATIVE SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1400 N HURSTBOURNE PKWY, LOUISVILLE, KY, 40223

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $176,529

Exercised Options: $176,529

Current Obligation: $176,529

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HTC71123DC025

IDV Type: IDC

Timeline