Unitech Services Group awarded $20M for laundry services by Department of Energy over 10 years
Contract Overview
Contract Amount: $19,992,342 ($20.0M)
Contractor: Unitech Services Group, Inc.
Awarding Agency: Department of Energy
Start Date: 2003-11-01
End Date: 2013-10-31
Contract Duration: 3,652 days
Daily Burn Rate: $5.5K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: REGULATED AND NON-REGULATED LAUNDRY SERVICES
Place of Performance
Location: RICHLAND, BENTON County, WASHINGTON, 99352
Plain-Language Summary
Department of Energy obligated $20.0 million to UNITECH SERVICES GROUP, INC. for work described as: REGULATED AND NON-REGULATED LAUNDRY SERVICES Key points: 1. Contract value appears reasonable given the decade-long duration and scope of regulated and non-regulated laundry services. 2. Full and open competition suggests a potentially competitive pricing environment. 3. Long contract duration (10 years) may introduce risks related to service obsolescence or changing needs. 4. Fixed-price contract type shifts cost overrun risk to the contractor. 5. Services provided are essential for operational continuity within the Department of Energy. 6. The contract falls within the industrial laundry services sector, a mature market.
Value Assessment
Rating: good
The contract value of approximately $2 million per year for comprehensive laundry services, including regulated materials, seems aligned with industry standards for large-scale operations. Benchmarking against similar government contracts for industrial laundry services would provide a more precise value assessment, but the duration and scope suggest a fair price point. The firm fixed-price structure also indicates a commitment to a defined cost, which is generally favorable for the government.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. This competitive process is expected to drive down prices and ensure the government receives the best value. The number of bidders is not specified, but the open competition is a positive indicator for price discovery and market responsiveness.
Taxpayer Impact: Taxpayers benefit from the competitive bidding process, which likely resulted in a more cost-effective solution for essential laundry services over the ten-year period.
Public Impact
Department of Energy facilities across Washington benefit from consistent and compliant laundry services. Ensures the availability of clean uniforms, linens, and potentially specialized protective gear for personnel. Supports the operational readiness and safety standards of DOE sites. Indirectly supports the local workforce through employment opportunities at Unitech Services Group.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long-term contract (10 years) may lead to service stagnation or failure to adapt to evolving laundry technologies or regulatory changes.
- Potential for price creep over the decade if contract terms do not adequately account for inflation or unforeseen cost increases.
- Dependence on a single contractor for a critical service over an extended period could pose supply chain risks.
Positive Signals
- Firm fixed-price contract protects against cost overruns.
- Full and open competition suggests a robust selection process and potentially competitive pricing.
- Contractor has a decade-long tenure, implying a level of established performance and reliability.
- Services are essential for maintaining operational standards and safety within DOE facilities.
Sector Analysis
The industrial laundry services sector is characterized by established players providing essential cleaning and maintenance for various industries, including government. This contract represents a significant, long-term commitment within this sector. Comparable spending benchmarks for large-scale government laundry services are difficult to pinpoint without more specific service details, but the annual value suggests a substantial operation.
Small Business Impact
The data indicates that this contract was not set aside for small businesses, nor does it explicitly mention subcontracting requirements for small businesses. This suggests that the primary award went to a larger entity, and the direct impact on the small business ecosystem may be limited unless Unitech Services Group actively engages small businesses for subcontracting opportunities.
Oversight & Accountability
Oversight for this contract would typically fall under the Department of Energy's contracting officers and program managers. Accountability is managed through the firm fixed-price contract terms, performance metrics, and potential for contract modifications or termination if service levels are not met. Transparency is generally maintained through federal procurement databases, though specific performance reviews are often internal.
Related Government Programs
- General Services Administration (GSA) Schedules for Laundry Services
- Department of Defense Laundry and Dry Cleaning Services
- Other Agency-Specific Facility Support Contracts
Risk Flags
- Long contract duration
- Potential for service obsolescence
- Regulatory change risk
Tags
laundry-services, industrial-laundries, department-of-energy, firm-fixed-price, full-and-open-competition, long-term-contract, regulated-services, washington, service-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $20.0 million to UNITECH SERVICES GROUP, INC.. REGULATED AND NON-REGULATED LAUNDRY SERVICES
Who is the contractor on this award?
The obligated recipient is UNITECH SERVICES GROUP, INC..
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $20.0 million.
What is the period of performance?
Start: 2003-11-01. End: 2013-10-31.
What is the historical spending pattern for laundry services by the Department of Energy prior to this contract?
Analyzing historical spending patterns for laundry services by the Department of Energy (DOE) prior to this 2003 award would require access to historical federal procurement data. Typically, agencies like the DOE would have ongoing contracts for laundry services to support their various facilities and personnel. The patterns would likely show fluctuations based on facility needs, contract durations, and the competitive landscape at the time. Without specific historical data, it's difficult to provide precise figures, but it's reasonable to assume consistent, albeit potentially smaller or differently structured, contracts for similar services over time. The shift to a single, long-term, large-value contract like this one might indicate a strategic decision by the DOE to consolidate services or achieve economies of scale.
How does the per-unit cost of laundry services under this contract compare to industry benchmarks?
Determining the precise per-unit cost for laundry services under this contract is challenging without detailed breakdowns of services rendered (e.g., cost per pound of laundry, cost per uniform cleaned). The contract value of $19.99 million over 10 years averages to approximately $2 million annually. To compare this to industry benchmarks, one would need to know the volume and type of laundry processed. General industry benchmarks for industrial laundry services can vary significantly based on location, service complexity (e.g., handling of hazardous materials), and contract volume. If this contract covers a large number of facilities or personnel, the per-unit cost might be competitive due to economies of scale. However, without specific metrics like cost per pound or per item, a direct comparison to market rates is speculative.
What are the key performance indicators (KPIs) used to evaluate Unitech Services Group's performance?
Key Performance Indicators (KPIs) for a contract like this typically focus on service quality, timeliness, and compliance. For laundry services, these would likely include metrics such as on-time delivery rates for clean items, defect rates (e.g., stains, tears, missing items), adherence to hygiene and safety standards (especially for regulated items), customer satisfaction surveys from DOE facility personnel, and potentially cost-efficiency metrics. The firm fixed-price nature of the contract implies that meeting these KPIs is crucial for the contractor to achieve profitability. Specific KPIs would be detailed in the contract's Performance Work Statement (PWS), outlining acceptable quality levels and the consequences of failing to meet them.
What is the track record of Unitech Services Group with federal contracts, particularly in the last 10 years?
Unitech Services Group, Inc. has been awarded this significant 10-year contract by the Department of Energy, indicating a substantial relationship with the federal government. To assess their track record, one would need to examine their performance on this and other federal contracts. This includes reviewing past performance evaluations, any contract disputes or terminations, and their history of delivering services on time and within budget. Given the duration of this specific contract (2003-2013), it suggests a period of satisfactory performance that led to its award. Further investigation into their contract history with various agencies would provide a more comprehensive view of their reliability and capabilities.
What are the potential risks associated with a 10-year contract for laundry services?
A 10-year contract for laundry services presents several potential risks. Firstly, technology in laundry processes and equipment can evolve significantly over a decade, potentially making the contracted services or equipment outdated or less efficient compared to newer methods. Secondly, regulatory requirements, particularly for regulated laundry, could change, necessitating costly adaptations by the contractor or potentially rendering current processes non-compliant. Thirdly, the long duration increases the risk of unforeseen economic fluctuations (inflation, changes in labor costs) impacting the contractor's profitability under a fixed-price agreement. Lastly, the government's needs might change over 10 years, requiring flexibility that a long-term contract might not easily accommodate, potentially leading to disputes or the need for costly modifications.
Industry Classification
NAICS: Other Services (except Public Administration) › Drycleaning and Laundry Services › Industrial Launderers
Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Contractor Details
Parent Company: Unifirst Corporation (UEI: 019723535)
Address: 2424 ROBERTSON AVE, RICHLAND, WA, 04
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $20,805,749
Exercised Options: $20,805,749
Current Obligation: $19,992,342
Timeline
Start Date: 2003-11-01
Current End Date: 2013-10-31
Potential End Date: 2013-10-31 00:00:00
Last Modified: 2014-08-04
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