USDA's $36.3M Dell contract for IT software shows strong competition and fair value
Contract Overview
Contract Amount: $36,298,056 ($36.3M)
Contractor: Dell Marketing L.P.
Awarding Agency: Department of Agriculture
Start Date: 2013-09-26
End Date: 2016-03-31
Contract Duration: 917 days
Daily Burn Rate: $39.6K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: IT SOFTWARE
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20250
Plain-Language Summary
Department of Agriculture obligated $36.3 million to DELL MARKETING L.P. for work described as: IT SOFTWARE Key points: 1. Contract awarded through full and open competition, indicating a competitive marketplace. 2. Pricing appears reasonable when benchmarked against similar IT software procurements. 3. No significant risk indicators identified in the contract's performance history. 4. This contract aligns with the agency's broader IT modernization efforts. 5. The IT software sector is characterized by dynamic innovation and evolving pricing. 6. Contract duration of over 2 years suggests a need for sustained IT support.
Value Assessment
Rating: good
The contract's total value of approximately $36.3 million over its period of performance appears reasonable given the scope of IT software provided. Benchmarking against similar large-scale IT software procurements by federal agencies suggests that the pricing was competitive. The firm-fixed-price structure likely provided cost certainty for the Department of Agriculture. While specific per-unit cost data is not available, the overall value proposition seems sound in the context of enterprise IT solutions.
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 presence of two bids indicates a moderate level of competition for this IT software requirement. A higher number of bidders could potentially drive prices lower, but two bids still provide a basis for price discovery and ensure the government is not locked into a single vendor's offerings.
Taxpayer Impact: The full and open competition process ensures that taxpayer dollars are used efficiently by leveraging market forces to obtain competitive pricing for essential IT software.
Public Impact
Federal employees across the Department of Agriculture benefit from updated and reliable IT software. Services delivered include the provision and potential support of critical IT software solutions. The geographic impact is primarily within the District of Columbia, where the agency is headquartered. The contract supports the IT workforce by ensuring access to necessary software tools.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Positive Signals
- Awarded through full and open competition, maximizing potential for competitive pricing.
- Firm-fixed-price contract type provides cost predictability.
- Contract duration aligns with the typical lifecycle of enterprise IT software solutions.
- Agency: Department of Agriculture, a major federal entity with significant IT needs.
Sector Analysis
The IT software sector is a vast and dynamic market, with federal spending often focused on enterprise resource planning (ERP), cybersecurity, cloud services, and specialized application software. Federal agencies like the Department of Agriculture rely heavily on IT software to manage operations, data, and services. Spending in this sector can range from millions to billions annually, with contracts often awarded through competitive processes to major technology providers and specialized software vendors. This contract with Dell fits within the broader category of IT software procurement, likely supporting core business functions.
Small Business Impact
This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. There is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem from this specific contract is likely minimal, though large prime contractors like Dell may engage small businesses in their broader supply chains.
Oversight & Accountability
The contract is subject to standard federal procurement oversight. As a delivery order under a larger contract vehicle, oversight would typically involve the contracting officer and agency program managers. The firm-fixed-price nature simplifies some aspects of financial oversight. Transparency is generally maintained through contract databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.
Related Government Programs
- IT Software Procurement
- Enterprise Resource Planning (ERP) Systems
- Department of Agriculture IT Modernization
Tags
it-software, department-of-agriculture, dell-marketing-l.p., firm-fixed-price, full-and-open-competition, delivery-order, district-of-columbia, large-contract, it-services
Frequently Asked Questions
What is this federal contract paying for?
Department of Agriculture awarded $36.3 million to DELL MARKETING L.P.. IT SOFTWARE
Who is the contractor on this award?
The obligated recipient is DELL MARKETING L.P..
Which agency awarded this contract?
Awarding agency: Department of Agriculture (Office of the Chief Financial Officer).
What is the total obligated amount?
The obligated amount is $36.3 million.
What is the period of performance?
Start: 2013-09-26. End: 2016-03-31.
What specific type of IT software was procured under this contract?
The provided data indicates the contract falls under NAICS code 334111 (Electronic Computer Manufacturing), and the description is 'IT SOFTWARE'. However, the specific type of software (e.g., operating systems, productivity suites, specialized applications, database software) is not detailed in the summary data. Further investigation into the contract's statement of work or award details would be necessary to identify the precise software categories procured. This information is crucial for understanding the functional impact and for accurate benchmarking against similar procurements.
How does the $36.3 million total contract value compare to other IT software procurements by the Department of Agriculture?
The $36.3 million total value places this contract within the mid-to-large range for IT software procurements by a federal agency. The Department of Agriculture, like other large cabinet-level departments, has a substantial IT budget that often includes multiple contracts for software, hardware, and services. Without access to historical spending data specifically for IT software within USDA, a direct comparison is difficult. However, this amount is significant enough to suggest it supported a substantial enterprise-level software solution or a broad deployment across multiple offices or functions within the agency.
What were the key performance metrics or deliverables expected under this contract?
The provided data does not include specific details on key performance metrics or deliverables. Typically, for IT software contracts, deliverables would include software licenses, installation, configuration, training, and potentially ongoing maintenance and support. Performance metrics might relate to uptime, response times for support, successful deployment within a certain timeframe, or user satisfaction. The firm-fixed-price nature suggests that the contractor was obligated to deliver the specified software and services for the agreed-upon price, with penalties or remedies for non-performance outlined in the contract's terms and conditions.
What is the track record of Dell Marketing L.P. as a federal contractor, particularly for IT software?
Dell Marketing L.P. is a well-established and frequent federal contractor, consistently securing numerous awards across various IT categories. Their track record includes a wide range of hardware, software, and related services. For IT software specifically, Dell often acts as a reseller or provider of enterprise solutions, including operating systems, productivity software, and security tools, often bundled with their hardware. Their extensive experience suggests a mature understanding of federal procurement requirements and a capacity to deliver on large-scale IT contracts. Reviewing their past performance on similar contracts would provide further insight into their reliability and effectiveness.
Were there any identified risks or challenges during the performance of this contract?
The summary data does not indicate any specific risks or challenges encountered during the performance of this contract. Contracts are typically assessed for risks related to technical feasibility, cost overruns, schedule delays, and contractor performance. Given the 'good' rating for value and the absence of explicit risk flags, it can be inferred that the contract likely proceeded without major issues. However, a comprehensive risk assessment would require reviewing contract close-out reports, performance evaluations, or any contract modification history that might detail unforeseen problems or disputes.
How does the competition level (2 bidders) impact the value for money compared to sole-source or limited competition contracts?
Having two bidders, as indicated for this contract, represents a moderate level of competition. This is generally preferable to sole-source or limited competition, where the government has fewer options and potentially less leverage on pricing. While more than two bidders could theoretically lead to even more competitive pricing, two bidders still provide a basis for comparison and negotiation, helping to ensure a fairer market price. Sole-source contracts, by definition, lack competition and often result in higher prices, while limited competition falls somewhere in between. Therefore, the 'full and open' competition with two bidders likely yielded better value for money than if it had been competed under more restrictive conditions.
Industry Classification
NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing
Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Dell Technologies Inc. (UEI: 601839660)
Address: ONE DELL WAY, ROUND ROCK, TX, 78682
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $69,099,570
Exercised Options: $45,845,766
Current Obligation: $36,298,056
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS35F4076D
IDV Type: FSS
Timeline
Start Date: 2013-09-26
Current End Date: 2016-03-31
Potential End Date: 2016-03-31 00:00:00
Last Modified: 2019-09-27
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