VA awards $24.5M contract to Federal Express for NGDS Shipping services

Contract Overview

Contract Amount: $24,550,077 ($24.6M)

Contractor: Federal Express Corporation

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-10-01

End Date: 2025-09-30

Contract Duration: 364 days

Daily Burn Rate: $67.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: NGDS SHIPPING

Place of Performance

Location: HINES, COOK County, ILLINOIS, 60141

State: Illinois Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $24.6 million to FEDERAL EXPRESS CORPORATION for work described as: NGDS SHIPPING Key points: 1. The Department of Veterans Affairs (VA) has awarded a significant contract for shipping services. 2. Federal Express Corporation is the sole awardee, indicating a specific capability or existing relationship. 3. The contract duration is one year, with a firm fixed price structure. 4. The spending falls within the 'Couriers and Express Delivery Services' sector.

Value Assessment

Rating: good

The contract value of $24.5M for a one-year delivery order appears reasonable for express shipping services, especially given the potential scale of VA logistics. Benchmarking against similar large-scale shipping contracts would provide further context.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' suggesting a limited competition scenario. This method may impact price discovery if alternative qualified vendors were not fully considered.

Taxpayer Impact: Taxpayer funds are being utilized for essential shipping services, with the firm fixed price aiming to control costs. The efficiency of the chosen vendor will directly impact the value for taxpayer dollars.

Public Impact

Ensures timely delivery of critical medical supplies and equipment for veterans. Supports the operational efficiency of the Department of Veterans Affairs nationwide. Provides a reliable logistics network for government operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition may not yield the best possible price.
Dependence on a single provider for critical logistics.

Positive Signals

Firm fixed price contract provides cost certainty.
Established provider with a track record in express delivery.

Sector Analysis

The Couriers and Express Delivery Services sector is highly competitive, with numerous providers capable of handling significant shipping volumes. The VA's spending aligns with typical government needs for rapid and reliable transportation of goods.

Small Business Impact

This contract does not appear to have specific set-asides for small businesses, as indicated by 'sb': false. The awardee is a large corporation, suggesting that small businesses were not primary targets for this specific procurement.

Oversight & Accountability

The VA's contracting process, including the justification for limited competition, should be subject to standard oversight to ensure fairness and optimal use of funds. Performance monitoring will be key to accountability.

Related Government Programs

Couriers and Express Delivery Services
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Potential for higher costs due to limited competition.
Risk of service disruption if Federal Express faces operational issues.
Lack of small business participation.
Need for robust performance monitoring to ensure value.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $24.6 million to FEDERAL EXPRESS CORPORATION. NGDS SHIPPING

Who is the contractor on this award?

The obligated recipient is FEDERAL EXPRESS CORPORATION.

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 $24.6 million.

What is the period of performance?

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

What was the specific justification for excluding other sources in this full and open competition?

The justification for excluding other sources under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES' typically relates to specific technical requirements, urgent needs, or unique capabilities that only one vendor can meet. Without further details, it's difficult to ascertain the precise reason, but it implies that while competition was considered, only Federal Express met the stringent criteria for this particular delivery order.

How does the per-unit cost of this contract compare to industry benchmarks for similar VA shipping needs?

A direct per-unit cost benchmark is not available without granular data on the types and volumes of shipments. However, the total contract value of $24.5M for one year suggests a substantial volume. Comparing the average cost per package or per pound against industry averages for expedited shipping, considering factors like distance and service level, would be necessary to assess cost-effectiveness.

What are the key performance indicators (KPIs) being used to measure the effectiveness of Federal Express in fulfilling this contract?

Effective contract management requires clearly defined KPIs such as on-time delivery rates, package condition upon arrival, tracking accuracy, and customer service responsiveness. The VA should have established these metrics in the contract's statement of work. Regular performance reviews against these KPIs will determine the overall effectiveness and value derived from this $24.5M award.

Industry Classification

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

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRANSPORTATION OF THINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Fedex Corp

Address: 2003 CORPORATE PLZ, MEMPHIS, TN, 38132

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

Financial Breakdown

Contract Ceiling: $24,550,077

Exercised Options: $24,550,077

Current Obligation: $24,550,077

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: HTC71123DC023

IDV Type: IDC

Timeline