VA awards $36.4M contract for mail manifesting services to FedEx Supply Chain Distribution System, Inc

Contract Overview

Contract Amount: $36,423,690 ($36.4M)

Contractor: Fedex Supply Chain Distribution System, Inc.

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-10-01

End Date: 2025-09-30

Contract Duration: 364 days

Daily Burn Rate: $100.1K/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 $36.4 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. is the sole awardee for this specific requirement. 3. The contract utilizes a Firm Fixed Price model, providing cost certainty. 4. Performance period spans one year, from October 1, 2024, to September 30, 2025. 5. The North American Industry Classification System (NAICS) code is 561499, indicating 'All Other Business Support Services'. 6. This award represents a significant investment in logistical support for VA operations.

Value Assessment

Rating: good

The contract value of $36.4 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 and package management services would provide a more precise value-for-money assessment. The firm fixed-price structure helps mitigate cost overruns for the government, assuming the scope of work is well-defined and achievable within the stated budget.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The 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 'full and open' designation generally indicates a competitive process. This approach is intended to foster price discovery and ensure the government receives competitive pricing by allowing all responsible sources to participate.

Taxpayer Impact: A full and open competition process is beneficial for taxpayers as it increases the likelihood of securing services at the most competitive price, preventing potential overspending that could occur with less competitive award methods.

Public Impact

Veterans will benefit from improved efficiency in the delivery of essential mail and supplies facilitated by this contract. The Department of Veterans Affairs will receive comprehensive mail manifesting and distribution services. The geographic impact is national, supporting VA facilities across the United States. This contract supports jobs within the logistics and supply chain sector, particularly at FedEx.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if performance is not closely monitored.
Reliance on a single vendor for critical manifesting services could pose a risk if service levels degrade.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
Firm Fixed Price contract type provides cost certainty for the government.
FedEx is a well-established logistics provider with extensive infrastructure.

Sector Analysis

The mail manifesting and business support services sector is a critical component of federal logistics, enabling the efficient movement of goods and information. This contract falls under the broader business support services category, which includes a wide range of administrative and operational assistance. The market for these services is competitive, with numerous large and small businesses offering specialized solutions. Federal spending in this area is substantial, reflecting the government's need for reliable and cost-effective logistical support across various agencies.

Small Business Impact

The provided data indicates that small business participation was not a specific set-aside for this contract (ss: false, sb: false). While this contract was awarded to a large corporation, there may be opportunities for small businesses to participate as subcontractors to FedEx Supply Chain Distribution System, Inc. The extent of such subcontracting is not detailed in this award notice but is a common practice in large federal contracts.

Oversight & Accountability

Oversight for this contract will likely be managed by the contracting officer and the relevant program officials within the Department of Veterans Affairs. Performance will be monitored against the terms and conditions of the contract, including service level agreements. Transparency is generally maintained through contract award databases and reporting requirements, though specific oversight mechanisms for this particular award are not detailed here.

Related Government Programs

Federal Mail Management Services
Logistics and Supply Chain Support Contracts
Business Support Services
Department of Veterans Affairs Procurement

Risk Flags

Potential for service disruption if contractor performance falters.
Reliance on a single vendor for critical logistics functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $36.4 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 $36.4 million.

What is the period of performance?

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

What is the historical spending by the VA on mail manifesting services, and how does this award compare?

Historical spending data for mail manifesting services specifically by the VA is not readily available in this summary. However, the current award of $36.4 million for a one-year period suggests a significant and ongoing need for these services. To provide a comparative analysis, one would need to examine past VA contracts for similar services, looking at both the annual value and the duration of those contracts. If previous contracts were for shorter durations or smaller scopes, this award could represent an increase in investment or a consolidation of services. Conversely, if previous contracts were of similar magnitude, it indicates consistent spending in this area. Without historical data, it's challenging to definitively state if this award represents an increase or decrease in spending trends.

What specific services are included under 'mail manifesting services' for this contract?

Mail manifesting services typically encompass a range of activities related to preparing mail for shipment, including sorting, weighing, labeling, and generating documentation required by postal carriers or couriers. For this contract with FedEx Supply Chain Distribution System, Inc., it likely involves the operational processes that track, manage, and prepare outgoing mail and packages for the Department of Veterans Affairs. This could include services such as automated mail sorting, postage calculation, compliance with postal regulations, and the generation of manifests that detail the contents, volume, and destination of shipments. The goal is to ensure efficient, cost-effective, and compliant handling of all mail processed through the VA's designated facilities.

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

FedEx Supply Chain Distribution System, Inc., as part of the larger FedEx Corporation, has a substantial track record in providing logistics, supply chain, and distribution services to both commercial and government clients. While specific details on their performance for federal mail manifesting contracts are not provided in this summary, FedEx is a globally recognized leader in package delivery and logistics. Their experience likely includes managing large volumes of shipments, adhering to strict delivery timelines, and complying with government security and regulatory requirements. A thorough review of their past performance evaluations (e.g., Contractor Performance Assessment Reporting System - CPARS) would be necessary to fully assess their capabilities and reliability for this specific VA contract.

How does the firm fixed-price contract type impact the risk for both the government and the contractor?

A Firm Fixed Price (FFP) contract type shifts the majority of the cost risk to the contractor. For the government, this means the price is set and generally will not change, regardless of the contractor's actual costs incurred. This provides budget certainty and protects against cost overruns. For the contractor, it means they must accurately estimate all costs associated with performing the contract. If their costs exceed their estimate, their profit margin will decrease, or they could incur a loss. Conversely, if they manage their costs efficiently, their profit margin could be higher than anticipated. This contract type incentivizes the contractor to control costs and perform efficiently to maximize profit.

Are there any specific performance metrics or key performance indicators (KPIs) associated with this contract?

The provided summary does not detail the specific performance metrics or Key Performance Indicators (KPIs) for this contract. However, typical KPIs for mail manifesting and logistics services often include on-time delivery rates, accuracy of manifests, package handling integrity (minimizing damage), cost per package processed, and compliance with all relevant regulations. The Department of Veterans Affairs would typically establish these metrics within the contract's Statement of Work (SOW) or Performance Work Statement (PWS) to ensure the contractor meets required service levels. Performance against these KPIs would be monitored throughout the contract period.

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: $36,423,690

Exercised Options: $36,423,690

Current Obligation: $36,423,690

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 36C77020A0009

IDV Type: BPA

Timeline