DoD's $246M Raytheon Contract for Logistics Consulting: Firm Fixed Price, Full and Open Competition
Contract Overview
Contract Amount: $245,964,922 ($246.0M)
Contractor: Raytheon Technical Services Company LLC
Awarding Agency: Department of Defense
Start Date: 2016-06-01
End Date: 2021-05-31
Contract Duration: 1,825 days
Daily Burn Rate: $134.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: IGF::OT::IGF SECREP - ROR
Place of Performance
Location: STERLING, LOUDOUN County, VIRGINIA, 20166
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $246.0 million to RAYTHEON TECHNICAL SERVICES COMPANY LLC for work described as: IGF::OT::IGF SECREP - ROR Key points: 1. Significant contract value of $246M awarded to Raytheon Technical Services Company LLC. 2. Full and open competition was utilized, suggesting a competitive bidding process. 3. The contract is for logistics consulting services, a critical area for defense operations. 4. The firm fixed price contract type aims to control costs for the government.
Value Assessment
Rating: good
The firm fixed price contract type is generally favorable for the government, as it shifts cost overrun risks to the contractor. The award amount of $246M for a 5-year period suggests a substantial but potentially reasonable annual spend for specialized logistics consulting.
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 compete. This method is expected to drive competitive pricing and ensure the government receives the best value.
Taxpayer Impact: The use of full and open competition and a firm fixed price contract are positive indicators for taxpayer value, as they promote efficiency and cost control.
Public Impact
Ensures efficient supply chain and distribution for the Department of the Navy. Supports critical military operations through expert logistics advice. Potential for cost savings through optimized logistics processes. Raytheon's expertise in defense contracting suggests a high level of service delivery.
Waste & Efficiency Indicators
Waste Risk Score: 75 / 10
Warning Flags
- Contract duration of 5 years may lead to vendor lock-in.
- Lack of specific performance metrics in provided data.
- Potential for scope creep in long-term consulting contracts.
Positive Signals
- Full and open competition utilized.
- Firm fixed price contract type.
- Awarded to a reputable defense contractor.
- Supports critical defense logistics functions.
Sector Analysis
This contract falls within the professional services sector, specifically logistics consulting. Spending benchmarks for similar services can vary widely based on scope and duration, but a $246M contract over five years for a major agency like the Department of Defense indicates a significant investment in specialized expertise.
Small Business Impact
The data indicates that small businesses were not directly involved as the prime contractor, as the award went to Raytheon Technical Services Company LLC. Further analysis would be needed to determine if small businesses were involved as subcontractors.
Oversight & Accountability
The contract's firm fixed price nature and full and open competition suggest a degree of oversight is built into the procurement process. However, ongoing monitoring of performance and adherence to the contract's scope will be crucial for accountability.
Related Government Programs
- Process, Physical Distribution, and Logistics Consulting Services
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Long contract duration (5 years).
- Potential for vendor lock-in.
- Lack of detailed performance metrics in summary data.
- Risk of scope creep in consulting services.
Tags
process-physical-distribution-and-logist, department-of-defense, va, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $246.0 million to RAYTHEON TECHNICAL SERVICES COMPANY LLC. IGF::OT::IGF SECREP - ROR
Who is the contractor on this award?
The obligated recipient is RAYTHEON TECHNICAL SERVICES COMPANY LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $246.0 million.
What is the period of performance?
Start: 2016-06-01. End: 2021-05-31.
What specific logistics challenges is the Department of the Navy addressing with this contract, and how will success be measured?
The contract aims to improve process, physical distribution, and logistics consulting services. Success will likely be measured through key performance indicators (KPIs) related to supply chain efficiency, cost reduction in logistics operations, and timely delivery of goods and services. Specific metrics are not detailed in the provided data but would be essential for evaluating the contract's effectiveness.
Given the 5-year duration, what mechanisms are in place to ensure the contract remains cost-effective and avoids potential cost overruns or scope creep?
The firm fixed price (FFP) contract type is the primary mechanism to control costs, as it shifts the risk of cost overruns to the contractor. However, robust oversight, regular performance reviews, and strict change control processes are also critical to prevent scope creep and ensure the contractor remains within the agreed-upon budget and deliverables throughout the 5-year period.
How does the $246M award compare to industry benchmarks for similar large-scale logistics consulting services provided to defense agencies?
Without specific details on the scope of services, it's challenging to provide a precise benchmark. However, for a 5-year contract of this magnitude with the Department of Defense, the $246M award (averaging $49.2M annually) appears substantial, reflecting the complexity and criticality of defense logistics. Benchmarking would require comparing it against contracts with similar service descriptions, agency size, and contract duration.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Process, Physical Distribution, and Logistics Consulting Services
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: M6700416R0001
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Raytheon Company
Address: 22265 PACIFIC BLVD, STERLING, VA, 20166
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $245,964,922
Exercised Options: $245,964,922
Current Obligation: $245,964,922
Actual Outlays: $7,023,866
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2016-06-01
Current End Date: 2021-05-31
Potential End Date: 2021-05-31 00:00:00
Last Modified: 2024-09-19
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