DoD's $41.4M warehousing contract to LB & B Associates Inc. awarded under full and open competition

Contract Overview

Contract Amount: $41,366,294 ($41.4M)

Contractor: LB & B Associates Inc

Awarding Agency: Department of Defense

Start Date: 2005-04-14

End Date: 2011-10-01

Contract Duration: 2,361 days

Daily Burn Rate: $17.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Place of Performance

Location: PORTSMOUTH, PORTSMOUTH (CITY) County, VIRGINIA, 23703

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $41.4 million to LB & B ASSOCIATES INC for work described as: Key points: 1. Contract value of $41.4M over its life suggests a significant investment in logistics support. 2. Awarded under full and open competition, indicating a potentially competitive bidding process. 3. The contract duration of 2361 days (approx. 6.5 years) points to a long-term need for these services. 4. Fixed-price contract type may offer cost certainty for the government, shifting some risk to the contractor. 5. The North American Industry Classification System (NAICS) code 493190 suggests services related to warehousing and storage. 6. Contractor LB & B ASSOCIATES INC has a history with this type of federal award. 7. The Defense Logistics Agency (DLA) is the awarding agency, a key player in military supply chains. 8. The contract was awarded in Virginia, a state with a significant federal contracting presence.

Value Assessment

Rating: fair

The total award amount of $41.4 million for a contract spanning over 6 years requires careful benchmarking against similar warehousing and storage contracts. Without specific details on the scope of services, it's challenging to definitively assess value for money. However, the fixed-price nature suggests an attempt to control costs. Further analysis would involve comparing the per-unit costs of services rendered (e.g., cost per square foot stored, cost per item handled) against industry standards and other government contracts for comparable services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'full and open competition,' meaning all responsible sources were permitted to submit a bid. The presence of 5 bids indicates a degree of competition, which is generally positive for price discovery. However, the number of bidders alone doesn't guarantee the most competitive pricing; the quality and competitiveness of the bids are also crucial factors. A thorough review would examine the bid protest history and the spread between the winning bid and other submitted offers.

Taxpayer Impact: Full and open competition generally benefits taxpayers by encouraging multiple companies to bid, potentially driving down prices and ensuring the government receives competitive rates for its spending.

Public Impact

The primary beneficiaries are the Department of Defense and its various branches, receiving essential warehousing and storage services to support military operations. Services delivered likely include storage of equipment, supplies, and materials, ensuring readiness and operational capability. The geographic impact is centered in Virginia, where the contract was awarded and likely where services are performed, potentially supporting local employment. Workforce implications may include job creation or retention for LB & B ASSOCIATES INC and its subcontractors in the logistics and warehousing sector within Virginia.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the fixed-price contract did not adequately account for all potential service demands or unforeseen operational costs.
Risk of contractor performance issues impacting the timely availability of critical supplies for the DoD.
Dependence on a single contractor for a significant duration could limit flexibility in adapting to changing logistical needs.
The specific nature of 'Other Warehousing and Storage' can be broad, requiring detailed understanding of the exact services to assess true value.
Limited transparency on the breakdown of costs within the $41.4M award makes granular value assessment difficult.

Positive Signals

Awarded through full and open competition, suggesting a robust process for selecting the contractor.
The fixed-price contract type provides a degree of cost certainty for the government.
A long contract duration (over 6 years) indicates a stable, long-term relationship and potentially established operational efficiencies.
The contractor, LB & B ASSOCIATES INC, has experience with federal contracts, suggesting familiarity with government requirements.
The Defense Logistics Agency's involvement implies adherence to established military supply chain standards.

Sector Analysis

The warehousing and storage sector is a critical component of the broader logistics and supply chain industry, supporting various government and commercial operations. Federal spending in this area is substantial, driven by the needs of agencies like the Department of Defense for storing equipment, supplies, and materials. This contract, valued at $41.4 million, represents a significant portion of spending within this niche, likely focused on specialized military logistics. Comparable spending benchmarks would involve analyzing the average contract values and durations for similar warehousing services awarded by the DoD and other federal agencies.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). Therefore, there are no direct subcontracting implications or specific benefits for small businesses mandated by a set-aside. The primary contractor, LB & B ASSOCIATES INC, is responsible for managing the entire scope of work. Any subcontracting would be at their discretion, and its impact on the small business ecosystem would depend on whether LB & B ASSOCIATES INC chooses to engage small businesses as subcontractors.

Oversight & Accountability

Oversight for this contract would primarily fall under the purview of the Defense Logistics Agency (DLA), the awarding agency. As a firm-fixed-price contract, oversight would focus on ensuring that LB & B ASSOCIATES INC meets the defined performance standards and deliverables outlined in the contract. Accountability measures would include performance reviews, potential penalties for non-compliance, and adherence to reporting requirements. Transparency is typically managed through contract databases and agency reporting, though specific operational details may be sensitive. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Defense Logistics Agency (DLA) Operations
Military Supply Chain Management
Federal Warehousing Contracts
Department of Defense Logistics Support
Fixed-Price Service Contracts

Risk Flags

Potential for performance issues impacting critical DoD supply chains.
Risk of cost escalation if fixed-price contract terms are not robust.
Limited visibility into specific service details and cost breakdowns.
Dependence on a single contractor for a long duration.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $41.4 million to LB & B ASSOCIATES INC. See the official description on USAspending.

Who is the contractor on this award?

The obligated recipient is LB & B ASSOCIATES INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $41.4 million.

What is the period of performance?

Start: 2005-04-14. End: 2011-10-01.

What is the specific nature of the 'Other Warehousing and Storage' services provided under this contract?

The NAICS code 493190, 'Other Warehousing and Storage,' is a broad category that can encompass a wide range of services beyond typical storage. This could include specialized storage for sensitive materials, inventory management, order fulfillment, distribution, and logistics support tailored to military needs. Without the specific contract statement of work (SOW), it's difficult to ascertain the precise services. However, given the awarding agency (Defense Logistics Agency), it's highly probable that these services are critical for maintaining the readiness and operational capability of DoD assets, potentially involving the storage and management of a diverse inventory of equipment, parts, and supplies.

How does the $41.4 million contract value compare to similar warehousing contracts awarded by the DoD?

Benchmarking the $41.4 million contract value requires comparing it against similar contracts for warehousing and storage services awarded by the Department of Defense over comparable timeframes and for similar scopes of work. The contract duration of approximately 6.5 years (2361 days) suggests a substantial, long-term requirement. A comprehensive comparison would involve analyzing the average annual spending for warehousing contracts of similar size and complexity within the DoD. For instance, if the average annual spend for comparable DoD warehousing contracts is in the range of $5-10 million, then this $41.4 million contract over 6.5 years appears to be within a reasonable, albeit significant, range. However, without detailed service scope and performance metrics, a precise value-for-money assessment remains challenging.

What are the potential risks associated with a firm-fixed-price contract of this magnitude and duration?

A firm-fixed-price (FFP) contract, while offering cost certainty to the government, shifts the risk of cost overruns to the contractor. For a contract valued at $41.4 million over 6.5 years, potential risks include the contractor underestimating costs, facing unforeseen operational challenges, or experiencing inflation that erodes profit margins. This could lead to the contractor seeking contract modifications, potentially increasing the overall cost, or, in extreme cases, compromising service quality to maintain profitability. The government's risk lies in ensuring the contractor has robust cost estimation and management capabilities and that the SOW is sufficiently detailed to prevent scope creep or disputes.

What is LB & B ASSOCIATES INC's track record with federal contracts, particularly with the Defense Logistics Agency?

LB & B ASSOCIATES INC has a history of receiving federal contracts, as indicated by its presence in federal procurement databases. To assess their track record specifically with the Defense Logistics Agency (DLA) and for warehousing services, a deeper dive into contract performance history, past performance evaluations, and any history of contract disputes or protests would be necessary. Federal procurement data often includes past performance information, which agencies use in source selection. A positive track record with DLA suggests familiarity with their specific requirements, reporting protocols, and operational tempo, which can be a mitigating factor for contract risk.

How does the competition level (5 bidders) impact the government's ability to secure favorable pricing?

Having five bidders in a full and open competition generally suggests a healthy level of market interest and potential for competitive pricing. More bidders typically increase the likelihood that the government will receive offers that reflect market rates and that the winning bid is cost-effective. However, the impact on pricing also depends on the nature of the bids submitted. If the bids were clustered closely together, it might indicate less price differentiation. Conversely, a wide spread between the highest and lowest bids could suggest varying interpretations of requirements or different cost structures. The government's procurement team would have analyzed the bids to ensure the selected offer represented the best value, considering both price and non-price factors.

What are the implications of this contract being awarded in Virginia?

Awarding a significant contract like this in Virginia has several implications. Firstly, it likely means that LB & B ASSOCIATES INC has a physical presence or operational capacity within the state to fulfill the contract requirements, potentially creating or sustaining jobs in the local economy. Virginia has a large federal contracting ecosystem, so this contract fits within that environment. Secondly, the proximity of the contractor to DLA facilities or military installations in Virginia could offer logistical advantages, potentially reducing transportation costs and lead times for services rendered. It also means that oversight and communication between the agency and contractor might be more streamlined.

Industry Classification

NAICS: Transportation and Warehousing › Warehousing and Storage › Other Warehousing and Storage

Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: SP060004R0032

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 9891 BROKENLAND PKWY, COLUMBIA, MD, 03

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $41,366,294

Exercised Options: $41,366,294

Current Obligation: $41,366,294

Contract Characteristics

Multi-Year Contract: Yes

Cost or Pricing Data: NO

Timeline