GSA awards $2M contract for mailroom support, raising questions about competition and value

Contract Overview

Contract Amount: $2,015,456 ($2.0M)

Contractor: Didlake Inc

Awarding Agency: General Services Administration

Start Date: 2021-03-30

End Date: 2026-09-29

Contract Duration: 2,009 days

Daily Burn Rate: $1.0K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: GSA MAILROOM ADMINISTRATIVE SERVICES SUPPORT FOR CENTRAL OFFICE (BASE AND 4 OPTION YEARS) - BASE PERIOD OF PERFORMANCE 03/29/2021 - 03/30/2022

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20405

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $2.0 million to DIDLAKE INC for work described as: GSA MAILROOM ADMINISTRATIVE SERVICES SUPPORT FOR CENTRAL OFFICE (BASE AND 4 OPTION YEARS) - BASE PERIOD OF PERFORMANCE 03/29/2021 - 03/30/2022 Key points: 1. The contract was awarded on a non-competitive basis, limiting price discovery. 2. The duration of the contract, including option years, extends over five years. 3. The service category falls under postal services, a generally stable and predictable market. 4. The firm-fixed-price contract type shifts performance risk to the contractor. 5. The contract is for administrative support services, indicating a focus on operational efficiency. 6. The awardee, DIDLAKE INC, has a single contract with the GSA. 7. The contract is located in Washington D.C., a high-cost metropolitan area.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of competitive bids and publicly available comparable contract data for mailroom administrative services. The firm-fixed-price structure is standard for such services, but without a competitive process, it's difficult to ascertain if the $2 million base period represents optimal value for the taxpayer. Further analysis would require understanding the scope of services provided and comparing them to industry benchmarks for mailroom operations.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not open to competition from other potential vendors. This approach limits the government's ability to explore different pricing structures and service offerings that might be available from a wider pool of contractors. The absence of competition means that price discovery is not driven by market forces, potentially leading to higher costs than if multiple bids were solicited.

Taxpayer Impact: The lack of competition means taxpayers may not be receiving the most cost-effective solution for mailroom administrative support. Without competitive pressure, there is less incentive for the contractor to offer the lowest possible price.

Public Impact

Federal agencies within the GSA's central office benefit from efficient mailroom operations. The contract ensures the delivery of essential postal and mail handling services. The geographic impact is concentrated in Washington D.C., supporting federal operations in the capital. The contract supports administrative roles within the mailroom, potentially impacting federal workforce needs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competitive bidding raises concerns about potential overpayment.
Limited transparency into the justification for a sole-source award.
The extended contract duration could lock in potentially suboptimal pricing.
The specific scope of services is not detailed, making value assessment difficult.

Positive Signals

Firm-fixed-price contract shifts performance risk to the contractor.
Contract is for essential administrative support services.
Awardee is a registered entity with the GSA.

Sector Analysis

The mailroom administrative services sector is a niche within the broader administrative and support services industry. While not a large market segment on its own, it is crucial for the operational continuity of government agencies. Spending in this area is typically driven by the need for reliable mail handling, document management, and internal distribution. Comparable spending benchmarks are difficult to establish without detailed service scope, but agencies often rely on established providers for these essential functions.

Small Business Impact

This contract does not appear to have a small business set-aside. There is no indication of subcontracting requirements for small businesses within the provided data. This means that opportunities for small businesses to participate in providing these mailroom services are likely limited unless they are direct partners or subcontractors to the prime awardee, DIDLAKE INC.

Oversight & Accountability

Oversight for this contract would primarily fall under the General Services Administration's Office of Administrative Services. As a definitive contract, it is subject to standard federal procurement regulations and oversight. Transparency regarding the justification for the sole-source award and ongoing performance monitoring would be key accountability measures. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

GSA Administrative Services
Postal Services
Mailroom Management
Federal Procurement

Risk Flags

Sole-source award lacks competitive justification.
Limited data on contractor's past performance.
Potential for non-competitive pricing.
Extended contract duration without clear performance benchmarks.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $2.0 million to DIDLAKE INC. GSA MAILROOM ADMINISTRATIVE SERVICES SUPPORT FOR CENTRAL OFFICE (BASE AND 4 OPTION YEARS) - BASE PERIOD OF PERFORMANCE 03/29/2021 - 03/30/2022

Who is the contractor on this award?

The obligated recipient is DIDLAKE INC.

Which agency awarded this contract?

Awarding agency: General Services Administration (Office of Administrative Services).

What is the total obligated amount?

The obligated amount is $2.0 million.

What is the period of performance?

Start: 2021-03-30. End: 2026-09-29.

What is the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was awarded as 'NOT AVAILABLE FOR COMPETITION,' which is synonymous with a sole-source award. The specific justification for this determination is not detailed in the provided information. Typically, sole-source awards are made when only one responsible source is available or capable of meeting the government's needs. This could be due to unique capabilities, proprietary technology, or urgent and compelling circumstances. Without further documentation from the GSA, the precise rationale remains unclear, which is a point of concern for transparency and competitive fairness.

How does the $2 million base period cost compare to similar mailroom support contracts?

Directly comparing the $2,015,455.71 base period cost to similar mailroom support contracts is challenging without more specific data on the scope of services, volume of mail handled, number of personnel required, and geographic location of comparable contracts. Mailroom operations can vary significantly in complexity. However, given the sole-source nature of this award, it is difficult to definitively state whether this represents a competitive market price. A thorough value-for-money assessment would require benchmarking against industry standards for similar-sized operations or obtaining competitive bids.

What are the potential risks associated with a sole-source award for mailroom services?

The primary risk associated with a sole-source award is the potential for inflated costs due to the lack of competitive pressure. Without competing bids, the government may not achieve the best possible price. Another risk is a potential reduction in service quality or innovation, as the contractor may face less incentive to improve performance when there is no threat of losing the contract to a competitor. Furthermore, a sole-source award can raise concerns about fairness and transparency in the procurement process, potentially leading to public scrutiny.

What is the track record of DIDLAKE INC with federal contracts, particularly with the GSA?

Based on the provided data, DIDLAKE INC has one contract with the GSA, which is this definitive contract for mailroom administrative services. The data does not indicate any prior contracts or extensive history with the GSA or other federal agencies. Therefore, assessing the contractor's track record based solely on this information is limited. A more comprehensive review would involve searching federal procurement databases for any other awards, performance reviews, or past performance information related to DIDLAKE INC.

What is the expected duration and total potential value of this contract, including option years?

The base period of performance for this contract is from March 29, 2021, to March 30, 2022. The contract includes four option years, extending the potential period of performance through September 29, 2026. The total potential value of the contract, encompassing the base period and all four option years, is not explicitly stated in the provided data. However, given the base period cost, the total value over the full five-year period could be substantial, likely several million dollars, depending on the pricing of the option years.

How does the firm-fixed-price contract type impact cost control and risk allocation?

A firm-fixed-price (FFP) contract type is generally preferred by the government when the scope of work is well-defined and risks can be reasonably estimated. Under an FFP contract, the contractor agrees to a total price for a well-defined effort, and the price is not subject to adjustment based on the contractor's cost experience. This shifts the risk of cost overruns entirely to the contractor. For the government, this provides cost certainty. However, if the initial price was not set competitively, the government might end up paying a premium for this cost certainty.

Industry Classification

NAICS: Transportation and Warehousing › Postal Service › Postal Service

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

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 47HAA021Q0006

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 8641 BREEDEN AVE STE 101, MANASSAS, VA, 20110

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

Financial Breakdown

Contract Ceiling: $2,015,456

Exercised Options: $2,015,456

Current Obligation: $2,015,456

Actual Outlays: $1,323,773

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline