VA awards $30.3M contract for mail manifesting services to FedEx Supply Chain

Contract Overview

Contract Amount: $30,370,348 ($30.4M)

Contractor: Fedex Supply Chain Distribution System, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2023-10-01

End Date: 2024-09-30

Contract Duration: 365 days

Daily Burn Rate: $83.2K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: MAIL MANIFESTING SERVICES

Place of Performance

Location: CHELMSFORD, MIDDLESEX County, MASSACHUSETTS, 01824

State: Massachusetts Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $30.4 million to FEDEX SUPPLY CHAIN DISTRIBUTION SYSTEM, INC. for work described as: MAIL MANIFESTING SERVICES Key points: 1. Contract aims to streamline mail manifesting operations for the Department of Veterans Affairs. 2. FedEx Supply Chain Distribution System, Inc. secured the award through full and open competition. 3. The contract duration is one year, with a potential for extension. 4. Services are categorized under 'All Other Business Support Services'. 5. The contract type is Firm Fixed Price, indicating predictable costs. 6. This award represents a significant investment in logistical support for VA operations.

Value Assessment

Rating: good

The contract value of $30.3 million for one year of mail manifesting services appears to be within a reasonable range for large-scale federal logistics support. Benchmarking against similar contracts for comprehensive mail handling and manifesting services across federal agencies would provide a more precise value-for-money assessment. However, given the scale of operations likely supported by the VA, this investment is expected to yield efficiencies in mail processing and distribution.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, suggesting that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but the process implies a competitive environment that should drive favorable pricing and service terms. This approach allows the government to select the most capable and cost-effective solution available in the market.

Taxpayer Impact: Taxpayers benefit from a competitive process that is designed to secure the best possible value for the services rendered, ensuring that public funds are used efficiently.

Public Impact

Veterans will benefit from improved efficiency in the delivery of essential communications and supplies. The contract supports critical administrative and logistical functions within the Department of Veterans Affairs. Services are likely to have a national impact, supporting VA facilities across the country. The contract supports jobs within the logistics and supply chain sector, particularly through FedEx.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if performance is not continuously monitored.
Reliance on a single large contractor could pose risks if service levels degrade.
Ensuring data security and privacy in mail manifesting processes is crucial.

Positive Signals

Award to a well-established logistics provider like FedEx suggests a high likelihood of reliable service.
Firm Fixed Price contract provides cost certainty for the VA.
Full and open competition indicates a robust selection process.

Sector Analysis

The mail manifesting services sector is a critical component of the broader business support services industry. This contract falls under the 'All Other Business Support Services' NAICS code (561499), which encompasses a wide range of non-classified support activities. Federal spending in this area is driven by the need for efficient and secure handling of official correspondence and packages across numerous agencies. Comparable spending benchmarks would involve analyzing contracts for mailroom management, logistics, and document processing services across government.

Small Business Impact

This contract was awarded to FedEx Supply Chain Distribution System, Inc. and does not indicate any specific small business set-aside. There is no information provided regarding subcontracting plans for small businesses. The scale of this award suggests it is likely focused on large-scale prime contractors, and the impact on the small business ecosystem would depend on whether FedEx engages small businesses for subcontracted services.

Oversight & Accountability

Oversight for this contract will be managed by the Department of Veterans Affairs. Accountability measures are inherent in the Firm Fixed Price contract type, which obligates the contractor to deliver specified services at an agreed-upon price. Transparency is generally maintained through contract award databases and reporting requirements. The specific Inspector General jurisdiction would be that of the VA's Office of Inspector General.

Related Government Programs

General Services Administration (GSA) Federal Supply Schedule Contracts
US Postal Service Mail Services
Department of Defense Logistics and Supply Chain Management

Risk Flags

Potential for service disruption if contractor faces operational issues.
Need for robust performance monitoring to ensure service quality.
Risk of price escalation in future contract renewals without competition.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $30.4 million to FEDEX SUPPLY CHAIN DISTRIBUTION SYSTEM, INC.. MAIL MANIFESTING SERVICES

Who is the contractor on this award?

The obligated recipient is FEDEX SUPPLY CHAIN DISTRIBUTION SYSTEM, INC..

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 $30.4 million.

What is the period of performance?

Start: 2023-10-01. End: 2024-09-30.

What is the historical spending pattern for mail manifesting services by the Department of Veterans Affairs?

Analyzing historical spending for mail manifesting services by the VA requires access to detailed procurement data over multiple fiscal years. Without specific historical data for this exact service category, it's difficult to provide a precise trend. However, federal agencies, including the VA, generally maintain consistent spending on essential support services like mail management. Spending can fluctuate based on changes in operational needs, agency size, and the adoption of new technologies or outsourcing strategies. A review of past contracts for similar services, potentially under different NAICS codes or broader logistics categories, would be necessary to identify any significant historical patterns or shifts in VA's investment in mail manifesting.

How does the awarded price compare to market rates for similar mail manifesting services?

Determining if the $30.3 million award is competitive requires a detailed market analysis and benchmarking against similar contracts. Factors influencing market rates include the volume of mail, the complexity of manifesting requirements (e.g., tracking, international shipping, specialized handling), the geographic scope of services, and the specific technological capabilities offered by vendors. Given that FedEx Supply Chain is a major logistics provider, their pricing is likely competitive within the large-scale federal contract space. However, a direct comparison to other federal contracts for similar services, or even commercial contracts of comparable scale, would be needed to definitively assess value for money. The firm fixed-price nature of the contract suggests that the VA has negotiated a price they deem acceptable for the defined scope of work.

What are the key performance indicators (KPIs) for this contract, and how will they be monitored?

Key Performance Indicators (KPIs) for a mail manifesting services contract typically focus on efficiency, accuracy, timeliness, and cost-effectiveness. Examples of KPIs could include: mail processing time, error rates in manifesting and tracking, on-time dispatch, cost per manifest, and compliance with security protocols. The Department of Veterans Affairs (VA) would establish these KPIs within the contract's Performance Work Statement (PWS). Monitoring would likely involve regular reporting from FedEx Supply Chain, performance reviews, and potentially site visits or audits by VA contracting officers and technical representatives. Failure to meet agreed-upon KPIs could result in contractual remedies, such as price reductions or termination.

What is the track record of FedEx Supply Chain Distribution System, Inc. in performing similar federal contracts?

FedEx Supply Chain Distribution System, Inc. is a division of FedEx Corporation, a globally recognized leader in logistics and transportation. They have a substantial track record of performing complex supply chain and distribution services for both commercial and government clients. While specific details of their past federal contracts for mail manifesting are not provided in this data, their parent company's extensive experience in managing large-scale logistics operations suggests a strong capability. Federal agencies often rely on established providers like FedEx for critical support services due to their infrastructure, technology, and operational expertise. A deeper dive into contract databases like FPDS or SAM.gov would reveal specific past performance records and client feedback for FedEx Supply Chain on federal contracts.

What are the potential risks associated with relying on a single contractor for mail manifesting services?

Relying on a single contractor for essential services like mail manifesting introduces several potential risks. Firstly, there's the risk of vendor lock-in, where the government becomes heavily dependent on the incumbent contractor, making it difficult and costly to switch providers in the future. Secondly, service degradation is a concern; if the contractor's performance declines due to internal issues, financial instability, or lack of competition, the government may have limited recourse beyond contractual remedies. Thirdly, a single point of failure exists: any disruption to the contractor's operations (e.g., labor disputes, system outages, natural disasters) could significantly impact the agency's ability to function. Finally, without ongoing competition, there's a risk that prices could become less competitive over time if not rigorously managed through contract modifications and oversight.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Business Support Services › All Other Business Support Services

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

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Fedex Corp

Address: 100 PAPERCRAFT PARK, PITTSBURGH, PA, 15238

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

Financial Breakdown

Contract Ceiling: $30,370,348

Exercised Options: $30,370,348

Current Obligation: $30,370,348

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 36C77020A0009

IDV Type: BPA

Timeline