GSA's $26.3M Salesforce CRM software deal with Carahsoft Technology Corp. awarded via full and open competition

Contract Overview

Contract Amount: $26,329,965 ($26.3M)

Contractor: Carahsoft Technology Corp

Awarding Agency: General Services Administration

Start Date: 2024-10-10

End Date: 2026-10-09

Contract Duration: 729 days

Daily Burn Rate: $36.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SALESFORCE CUSTOMER RELATIONSHIP MANAGEMENT CRM SOFTWARE LICENSING AND PRODUCTS

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

General Services Administration obligated $26.3 million to CARAHSOFT TECHNOLOGY CORP for work described as: SALESFORCE CUSTOMER RELATIONSHIP MANAGEMENT CRM SOFTWARE LICENSING AND PRODUCTS Key points: 1. Value for money assessed through competitive bidding and fixed-price contract. 2. Competition dynamics indicate a robust market for CRM software. 3. Risk indicators include contract duration and reliance on a single vendor for licensing. 4. Performance context is within the General Services Administration's Federal Acquisition Service. 5. Sector positioning is within the Software Publishers industry, specifically CRM solutions.

Value Assessment

Rating: good

The contract's value of $26.3 million over approximately two years appears reasonable given the scope of CRM software licensing and products. As a firm-fixed-price contract awarded through full and open competition, it suggests a degree of price discovery and risk transfer to the contractor. Benchmarking against similar large-scale federal CRM procurements would provide a more precise value assessment, but the competitive nature of the award is a positive indicator.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit a bid. The specific award mechanism, a BPA Call, suggests it was likely competed under an existing Blanket Purchase Agreement (BPA), which itself was subject to competition. The presence of multiple bidders (implied by full and open competition) generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: Taxpayers benefit from the competitive process, which is designed to secure the best possible pricing and value for the government's investment in essential software.

Public Impact

Federal agencies utilizing General Services Administration (GSA) channels benefit from access to Salesforce CRM software. The services delivered include licensing and products for customer relationship management. The geographic impact is nationwide, supporting federal agencies across the United States. Workforce implications include enabling federal employees to utilize advanced CRM tools for improved constituent services and internal operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Contract duration of approximately two years could necessitate future re-competition and potential transition costs.
Reliance on a single vendor for licensing, even through a reseller, may limit future flexibility in exploring alternative solutions.
The specific products and services included require careful monitoring to ensure they align with evolving agency needs.

Positive Signals

Awarded through full and open competition, ensuring a competitive marketplace.
Firm-fixed-price contract type helps control costs and budget certainty.
GSA's involvement suggests adherence to established procurement best practices and oversight.

Sector Analysis

The federal government's spending on software, particularly Customer Relationship Management (CRM) solutions, is a significant segment within the broader IT sector. This contract falls under the Software Publishers industry (NAICS 511210). The market for enterprise CRM software is competitive, with major players vying for government contracts. GSA's role as an aggregator for common software needs aims to leverage economies of scale and streamline procurement for agencies.

Small Business Impact

This contract does not appear to have a specific small business set-aside (ss: false, sb: false). While Carahsoft Technology Corp. is a reseller, their primary role in this specific award does not indicate a direct subcontracting plan for small businesses related to this particular BPA Call. Further analysis of the underlying BPA and any associated subcontracting goals would be needed to fully assess the impact on the small business ecosystem.

Oversight & Accountability

Oversight is provided by the General Services Administration (GSA), specifically the Federal Acquisition Service. As a BPA Call, it operates under the framework of the parent BPA, which has its own oversight mechanisms. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would typically fall under the GSA OIG for any potential issues related to procurement integrity or performance.

Related Government Programs

Salesforce Government Cloud
Microsoft Dynamics CRM Federal Contracts
Oracle Siebel Federal Contracts
Federal Civilian IT Software Spending
GSA Schedule Contracts

Risk Flags

Contract Duration
Vendor Lock-in Potential
Scope Creep Risk

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $26.3 million to CARAHSOFT TECHNOLOGY CORP. SALESFORCE CUSTOMER RELATIONSHIP MANAGEMENT CRM SOFTWARE LICENSING AND PRODUCTS

Who is the contractor on this award?

The obligated recipient is CARAHSOFT TECHNOLOGY CORP.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $26.3 million.

What is the period of performance?

Start: 2024-10-10. End: 2026-10-09.

What is Carahsoft Technology Corp.'s track record with federal CRM contracts?

Carahsoft Technology Corp. is a prominent government IT reseller with a substantial track record of delivering software solutions to federal agencies. They frequently act as a reseller for major software vendors like Salesforce, Microsoft, and Adobe, leveraging GSA Schedules and other contract vehicles to facilitate government procurement. Their business model is heavily reliant on serving the public sector, and they have consistently secured numerous awards for software licensing and support across various agencies. Analyzing their past performance on similar Salesforce-related contracts, including volume, contract types, and agency clients, would provide further insight into their capabilities and pricing strategies within the federal market.

How does the per-unit cost of this Salesforce CRM software compare to other federal agencies or commercial rates?

Determining the precise per-unit cost is challenging without specific details on the licenses and products included in this $26.3 million award. Federal Acquisition Regulation (FAR) clauses and GSA's pricing policies aim to ensure fair and reasonable pricing. However, direct comparisons are difficult as contract vehicles, negotiated discounts, and specific product bundles vary significantly. Commercial rates for enterprise CRM solutions like Salesforce can range widely based on features, user count, and support levels. Benchmarking would ideally involve comparing the negotiated unit prices within this BPA Call against other GSA Schedule contracts for Salesforce or similar CRM platforms awarded to different resellers or directly by agencies, considering the volume and duration of the agreements.

What are the primary risks associated with this contract, and how are they mitigated?

Key risks include potential cost overruns if the scope expands beyond initial expectations, vendor lock-in limiting future flexibility, and performance issues if the software or support does not meet agency needs. Mitigation strategies are embedded in the contract structure and oversight. The firm-fixed-price nature transfers some cost risk to the contractor. Full and open competition helps ensure a competitive baseline. GSA's oversight and the contract's defined period (ending 2026) necessitate periodic reviews and potential re-competition, encouraging ongoing performance. Agencies are expected to manage scope and performance through established program management practices.

How effective is Salesforce CRM software in meeting the diverse needs of federal agencies?

Salesforce CRM is widely adopted across various sectors, including federal agencies, due to its robust feature set, scalability, and customization capabilities. Its effectiveness hinges on proper implementation, configuration, and user adoption tailored to specific agency missions, such as constituent services, case management, program oversight, and internal workflow optimization. Agencies like the Department of Veterans Affairs (VA) and the Securities and Exchange Commission (SEC) have utilized Salesforce for various functions. Success is often measured by improvements in data management, process efficiency, inter-agency collaboration, and citizen engagement. However, the effectiveness is highly dependent on the agency's ability to manage the technology and integrate it seamlessly into existing operations.

What are the historical spending patterns for Salesforce CRM software through GSA?

Historical spending data through GSA for Salesforce products, often facilitated by resellers like Carahsoft, indicates a consistent and growing demand for CRM solutions within the federal government. GSA's role in aggregating demand and establishing contract vehicles aims to provide agencies with efficient access to these technologies. Over the years, federal agencies have increasingly relied on cloud-based CRM platforms to modernize operations and improve service delivery. Spending patterns reflect a trend towards enterprise-wide deployments rather than siloed solutions, driven by the need for integrated data and streamlined processes. The total federal spending on Salesforce, including through GSA and other contract vehicles, likely runs into hundreds of millions of dollars annually.

What is the typical duration for federal CRM software licensing contracts, and how does this one compare?

Federal contracts for software licensing, especially for enterprise solutions like CRM, often have an initial base period followed by multiple option periods, allowing for flexibility and continuity. Base periods can range from one to three years, with total potential durations extending up to five or ten years, depending on the contract type and agency needs. This specific contract has a base period of approximately two years (729 days). This duration is relatively standard for an initial award or a specific BPA Call, allowing agencies to evaluate the solution and vendor performance before committing to longer terms or subsequent procurements. Longer-term contracts often involve more extensive negotiations and may be structured differently.

Industry Classification

NAICS: Information › Software Publishers › Software Publishers

Product/Service Code: IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 47QFDA24Q0027

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 11493 SUNSET HILLS RD, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $126,781,946

Exercised Options: $26,329,965

Current Obligation: $26,329,965

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: 47QTCA21A000R

IDV Type: BPA

Timeline