DoD's $42.3M Salesforce Contract with Carahsoft Faces Scrutiny Over Competition and Value
Contract Overview
Contract Amount: $42,304,435 ($42.3M)
Contractor: Carahsoft Technology Corp
Awarding Agency: Department of Defense
Start Date: 2025-02-28
End Date: 2028-02-27
Contract Duration: 1,094 days
Daily Burn Rate: $38.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: CRM SALESFORCE SERVICES SOFTWARE.
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20330
Plain-Language Summary
Department of Defense obligated $42.3 million to CARAHSOFT TECHNOLOGY CORP for work described as: CRM SALESFORCE SERVICES SOFTWARE. Key points: 1. Significant contract value of $42.3 million for CRM services. 2. Sole awardee Carahsoft Technology Corp raises questions about competition. 3. Potential for overpayment given the lack of competitive bidding. 4. IT services sector, specifically software and related services.
Value Assessment
Rating: questionable
The contract's value of $42.3 million for Salesforce services warrants scrutiny. Without clear competitive benchmarks or pricing details, it's difficult to assess if this price is optimal compared to similar government or commercial contracts for CRM software and implementation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Although listed as 'Full and Open Competition,' the award was a single delivery order to Carahsoft Technology Corp. This suggests that while the initial solicitation may have been open, the subsequent award process or specific contract vehicle limited the actual competitive landscape, potentially impacting price discovery.
Taxpayer Impact: The lack of robust competition could lead to taxpayers paying a premium for these CRM services, as the government may not have secured the best possible pricing.
Public Impact
Air Force personnel will utilize Salesforce for critical operations, impacting efficiency and data management. Taxpayers may be overpaying for software and services due to limited competitive pressure. The contract's duration and value could set a precedent for future IT procurements.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition despite 'Full and Open' designation.
- Potential for inflated pricing.
- Lack of transparency in award justification.
Positive Signals
- Provides essential CRM capabilities to the Air Force.
- Contract is for a defined period, allowing for future re-evaluation.
Sector Analysis
This contract falls within the IT services sector, specifically focusing on Customer Relationship Management (CRM) software and related services. Government spending on enterprise software like Salesforce is substantial, with benchmarks often varying widely based on customization, user count, and support levels.
Small Business Impact
The data indicates that Carahsoft Technology Corp, the awardee, is not a small business. The contract does not explicitly mention set-asides for small businesses, suggesting that opportunities for small business participation may be limited or indirect.
Oversight & Accountability
Oversight will be crucial to ensure the Air Force effectively utilizes these services and that Carahsoft meets all contractual obligations. Regular performance reviews and cost analysis are necessary to mitigate risks associated with limited competition.
Related Government Programs
- Other Computer Related Services
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for lack of competitive pricing.
- Risk of vendor lock-in.
- Dependency on a single provider for critical IT services.
- Unclear justification for single-source award under open competition.
Tags
other-computer-related-services, department-of-defense, dc, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $42.3 million to CARAHSOFT TECHNOLOGY CORP. CRM SALESFORCE SERVICES SOFTWARE.
Who is the contractor on this award?
The obligated recipient is CARAHSOFT TECHNOLOGY CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Air Force).
What is the total obligated amount?
The obligated amount is $42.3 million.
What is the period of performance?
Start: 2025-02-28. End: 2028-02-27.
What specific justification was provided for awarding this significant contract to a single vendor, especially under a 'Full and Open Competition' designation?
The justification for awarding to a single vendor under 'Full and Open Competition' is unclear from the provided data. Typically, this designation implies broad market outreach. However, the single award suggests either a highly specialized requirement met by only one entity or a potential issue in the procurement process that limited the number of responsive, capable bidders.
How does the $42.3 million price tag compare to industry benchmarks for similar Salesforce implementations and support, considering the contract's duration?
Without specific details on the scope of services, number of users, and customization levels, a direct comparison is challenging. However, $42.3 million over nearly four years for CRM services is substantial. Industry benchmarks suggest that large-scale Salesforce deployments can range significantly, making a detailed cost-benefit analysis against comparable government or commercial contracts essential to ensure value for money.
What mechanisms are in place to ensure effective performance and accountability from Carahsoft Technology Corp throughout the contract's duration?
Accountability mechanisms typically include performance metrics, service level agreements (SLAs), and regular progress reviews outlined in the contract. The Department of the Air Force should actively monitor Carahsoft's performance against these metrics, conduct periodic evaluations, and ensure timely delivery of services and support to maximize the return on investment and mitigate risks.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services
Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
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: $42,304,435
Exercised Options: $42,304,435
Current Obligation: $42,304,435
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: NNG15SC27B
IDV Type: GWAC
Timeline
Start Date: 2025-02-28
Current End Date: 2028-02-27
Potential End Date: 2028-02-27 00:00:00
Last Modified: 2026-01-09
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