GSA awards $30M Salesforce contract to Carahsoft, highlighting IT services for federal agencies

Contract Overview

Contract Amount: $30,042,691 ($30.0M)

Contractor: Carahsoft Technology Corp

Awarding Agency: General Services Administration

Start Date: 2011-08-01

End Date: 2016-07-31

Contract Duration: 1,826 days

Daily Burn Rate: $16.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: SALESFORCE ENTERPRISE LICENSING AGREEMENT.

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20405, UNITED STATES OF AMERICA

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $30.0 million to CARAHSOFT TECHNOLOGY CORP for work described as: SALESFORCE ENTERPRISE LICENSING AGREEMENT. Key points: 1. Contract value of $30M over 5 years suggests a significant investment in enterprise software. 2. The 'Other Computer Related Services' NAICS code indicates a broad scope of IT support. 3. A firm fixed-price contract type generally offers cost certainty for the government. 4. The contract was awarded under full and open competition, implying a robust bidding process. 5. The duration of 1826 days (5 years) points to a long-term need for these services. 6. Carahsoft Technology Corp is a frequent awardee of government IT contracts.

Value Assessment

Rating: good

The contract value of $30,004,269.04 over five years for Salesforce enterprise licensing and related services appears reasonable given the scope. Benchmarking against similar large-scale enterprise software agreements for federal agencies suggests this is within expected parameters. The firm fixed-price structure provides cost predictability, which is a positive indicator of value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of 4 bids suggests a healthy level of competition for this significant IT services agreement. This competitive environment is generally expected to drive more favorable pricing and terms for the government.

Taxpayer Impact: Full and open competition ensures that taxpayer dollars are used efficiently by leveraging market forces to secure competitive pricing and innovative solutions.

Public Impact

Federal agencies, particularly those within the General Services Administration (GSA), benefit from access to Salesforce enterprise software and associated IT services. The contract supports the delivery of critical IT infrastructure and software solutions necessary for government operations. Services are likely concentrated in the District of Columbia, where the contract's place of performance is noted. The contract supports IT professionals and potentially other roles involved in the implementation and maintenance of Salesforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in with a widely adopted enterprise solution like Salesforce.
Reliance on a single contractor for extensive IT services could pose continuity risks if not managed proactively.

Positive Signals

Awarded through full and open competition, indicating a competitive process.
Firm fixed-price contract provides budget certainty.
Long contract duration suggests a stable, ongoing need met by this award.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on software licensing and related IT services. The market for enterprise Customer Relationship Management (CRM) software, such as Salesforce, is substantial within the federal government, with agencies increasingly adopting cloud-based solutions to improve efficiency and data management. Comparable spending benchmarks for large federal IT procurements often run into tens or hundreds of millions of dollars.

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 mention of subcontracting goals for small businesses. Therefore, the direct impact on the small business ecosystem from this specific award is likely minimal, though Carahsoft may engage small businesses as part of its broader subcontracting network.

Oversight & Accountability

The General Services Administration (GSA) is responsible for overseeing this contract. As a large federal agency, GSA has established procurement regulations and oversight mechanisms. The firm fixed-price nature of the contract provides a degree of financial oversight. Transparency is generally maintained through public contract databases like FPDS. Inspector General oversight would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Civilian IT Modernization Programs
GSA Schedules Program
Enterprise Software Licensing Agreements
Cloud Computing Services for Government

Risk Flags

Potential for vendor lock-in
Reliance on a single provider for critical IT services

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $30.0 million to CARAHSOFT TECHNOLOGY CORP. SALESFORCE ENTERPRISE LICENSING AGREEMENT.

Who is the contractor on this award?

The obligated recipient is CARAHSOFT TECHNOLOGY CORP.

Which agency awarded this contract?

Awarding agency: General Services Administration (Office of the Administrator).

What is the total obligated amount?

The obligated amount is $30.0 million.

What is the period of performance?

Start: 2011-08-01. End: 2016-07-31.

What is Carahsoft Technology Corp's track record with federal IT contracts, particularly those involving enterprise software?

Carahsoft Technology Corp has a substantial track record of winning federal IT contracts, often acting as a reseller or prime contractor for various software and hardware solutions. They are frequently awarded contracts through GSA Schedules and other competitive vehicles. Their portfolio includes numerous agreements for enterprise software, cloud services, cybersecurity solutions, and IT hardware. This extensive experience suggests a strong understanding of federal procurement processes and a well-established relationship with government agencies. Their ability to secure large contracts like this one indicates a capacity to manage complex IT requirements and deliver solutions across the federal landscape.

How does the $30M value of this Salesforce contract compare to other similar federal IT procurements?

A $30 million contract over five years for enterprise software licensing and services is a significant, but not uncommon, figure within the federal IT landscape. Large agencies frequently award contracts in this range for CRM systems, ERP solutions, or comprehensive IT infrastructure support. For instance, other federal agencies have awarded similar or larger sums for enterprise software suites from vendors like Microsoft, Oracle, or SAP. The value is consistent with the scale of Salesforce's enterprise offerings and the typical duration of such agreements, which aim for long-term strategic implementation and support.

What are the primary risks associated with a long-term, firm fixed-price contract for enterprise software?

The primary risks with a long-term, firm fixed-price contract for enterprise software revolve around potential scope creep, vendor lock-in, and the risk of the contractor underperforming while retaining the fixed price. If the government's needs evolve significantly beyond the initial scope, renegotiating terms could be difficult or costly. Vendor lock-in is a concern as agencies become deeply integrated with a specific platform like Salesforce, making future transitions challenging. Furthermore, if the contractor faces unforeseen cost increases or technical difficulties, they might cut corners on service quality to maintain profitability, impacting the government's return on investment. Robust contract management and clear performance metrics are crucial to mitigate these risks.

How effective is the 'full and open competition' method in ensuring value for money in large IT contracts?

Full and open competition is generally considered the most effective method for ensuring value for money in large IT contracts. By allowing all responsible sources to submit bids, it fosters a competitive environment that drives down prices, encourages innovation, and increases the likelihood of selecting the best-value solution. The presence of multiple bidders, as indicated by the 4 bids in this case, suggests that the market was engaged. This competition pressures contractors to offer competitive pricing and superior performance to win the award. While it requires more upfront effort in solicitation and evaluation, the long-term benefits in terms of cost savings and quality are substantial for taxpayers.

What are the historical spending patterns for Salesforce or similar CRM software within the GSA or other federal agencies?

Historical spending patterns indicate a growing trend of federal agencies adopting enterprise CRM solutions like Salesforce, often through GSA contracts or other procurement vehicles. Agencies utilize these platforms for constituent services, case management, program management, and internal operations. Spending has increased as agencies move towards cloud-based solutions for scalability, accessibility, and reduced infrastructure overhead. GSA, in particular, facilitates such procurements to provide agencies with streamlined access to necessary IT tools. While specific historical data for this exact contract isn't provided, the overall federal IT spending on CRM and related services has been robust and is projected to continue growing.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

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: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 12369 SUNRISE VALLEY DR,STE. D2, RESTON, VA, 20191

Business Categories: Category Business, Small Business

Financial Breakdown

Contract Ceiling: $30,042,691

Exercised Options: $30,042,691

Current Obligation: $30,042,691

Parent Contract

Parent Award PIID: GS35F0131R

IDV Type: FSS

Timeline