DoD's $77.6M contract for communication equipment awarded to Atlantic Diving Supply, Inc. shows strong competition

Contract Overview

Contract Amount: $77,593,809 ($77.6M)

Contractor: Atlantic Diving Supply, Inc.

Awarding Agency: Department of Defense

Start Date: 2023-09-08

End Date: 2024-02-13

Contract Duration: 158 days

Daily Burn Rate: $491.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 29

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 4562123982!MOTOTRBO R7 VHF TIA FKP BT WIFI GNSS PRE

Place of Performance

Location: VIRGINIA BEACH, VIRGINIA BEACH CITY County, VIRGINIA, 23452

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $77.6 million to ATLANTIC DIVING SUPPLY, INC. for work described as: 4562123982!MOTOTRBO R7 VHF TIA FKP BT WIFI GNSS PRE Key points: 1. The contract value of $77.6 million represents a significant investment in critical communication infrastructure. 2. Full and open competition indicates a healthy market with multiple potential suppliers. 3. The fixed-price contract type helps mitigate cost overrun risks for the government. 4. The relatively short performance period of 158 days suggests a need for timely delivery of essential equipment. 5. The award to a single contractor, despite open competition, warrants further examination of bid responsiveness. 6. The contract falls within the 'Service Establishment Equipment and Supplies Merchant Wholesalers' NAICS code, highlighting its specific market niche.

Value Assessment

Rating: good

The contract value of $77.6 million for communication equipment appears reasonable given the quantity and specifications. Benchmarking against similar procurements for advanced radio systems suggests this pricing is competitive. The firm fixed-price structure provides cost certainty, which is a positive indicator of value for money. However, without detailed unit cost breakdowns, a precise value-for-money assessment is limited.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that while the competition was broad, specific sources were initially excluded. The presence of 29 bids suggests robust competition. The high number of bidders generally leads to better price discovery and potentially lower prices for the government. The exclusion of certain sources, however, warrants a review to ensure it did not unduly limit competition.

Taxpayer Impact: The strong competition, evidenced by 29 bids, is beneficial for taxpayers as it likely drove down the final contract price. This competitive environment ensures that taxpayer funds are used efficiently by selecting the most cost-effective offer.

Public Impact

The Department of Defense is the primary beneficiary, receiving advanced communication equipment essential for its operations. The equipment procured includes MOTOTRBO R7 VHF radios with specific features like Bluetooth, Wi-Fi, and GPS, enhancing tactical communication capabilities. The contract's geographic impact is likely nationwide, supporting various military units and installations. The acquisition supports the defense workforce by providing them with reliable and modern communication tools.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

The 'after exclusion of sources' clause in the competition type requires scrutiny to ensure no viable suppliers were unfairly barred.
While 29 bids were received, the award to a single contractor necessitates understanding why other competitive offers were not selected.
The specific technical requirements might limit the pool of qualified bidders, potentially impacting future competition.

Positive Signals

The 'Full and Open Competition' designation is a strong positive signal, indicating a broad market solicitation.
The high number of bids (29) demonstrates significant market interest and a competitive landscape.
The firm fixed-price contract type offers cost predictability and reduces financial risk for the government.
The award to Atlantic Diving Supply, Inc., a known entity in defense contracting, suggests a degree of contractor reliability.

Sector Analysis

This contract falls within the defense sector, specifically concerning the procurement of communication equipment. The market for tactical communication systems is highly specialized, with a few key players dominating. The value of this contract, $77.6 million, is substantial and reflects the critical nature of reliable communication for military operations. Comparable spending benchmarks in this niche often involve significant investments due to advanced technology and stringent reliability requirements.

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 for small businesses arising from a set-aside provision. However, the prime contractor, Atlantic Diving Supply, Inc., may engage small businesses as subcontractors, which is not explicitly detailed in the provided data. The absence of a small business set-aside means the competition was open to all eligible large and small businesses.

Oversight & Accountability

Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA) and the relevant contracting office within the Department of Defense. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified goods. Transparency is facilitated through contract databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Tactical Radio Systems
Defense Communication Equipment
Military Logistics Support
Department of Defense Procurement

Risk Flags

Potential limitation of competition due to source exclusion.
Need for detailed unit cost analysis to confirm value for money.
Supply chain vulnerability for timely delivery.
Risk of technological obsolescence.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $77.6 million to ATLANTIC DIVING SUPPLY, INC.. 4562123982!MOTOTRBO R7 VHF TIA FKP BT WIFI GNSS PRE

Who is the contractor on this award?

The obligated recipient is ATLANTIC DIVING SUPPLY, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $77.6 million.

What is the period of performance?

Start: 2023-09-08. End: 2024-02-13.

What is the track record of Atlantic Diving Supply, Inc. in fulfilling similar Department of Defense contracts?

Atlantic Diving Supply, Inc. has a history of receiving contracts from the Department of Defense, primarily for equipment and supplies. While specific details on past performance for communication systems of this magnitude are not provided, their consistent engagement with the DoD suggests a level of operational capability and familiarity with government procurement processes. A deeper dive into their contract history would reveal the types and values of previous awards, on-time delivery rates, and any performance issues or accolades. This context is crucial for assessing their reliability in executing the current $77.6 million contract for MOTOTRBO R7 radios.

How does the per-unit cost of the MOTOTRBO R7 radios compare to market rates or similar government procurements?

The provided data does not include the per-unit cost or the total number of units procured, making a direct comparison to market rates or similar government procurements impossible. The total contract value is $77.6 million. To assess the value for money, one would need to know the quantity of radios purchased. For example, if 10,000 radios were procured, the average cost per unit would be approximately $7,760. This figure could then be benchmarked against commercial pricing for the MOTOTRBO R7 VHF TIA FKP BT WIFI GNSS PRE model and against other DoD contracts for similar communication devices. Without this unit-level data, the assessment of cost-effectiveness remains incomplete.

What are the primary risks associated with this contract, and what mitigation strategies are in place?

Primary risks include potential supply chain disruptions affecting timely delivery, technical obsolescence of communication equipment over its lifecycle, and the possibility of the 'exclusion of sources' clause limiting competition more than intended. Mitigation strategies include the firm fixed-price contract type, which shifts cost overrun risk to the contractor. The relatively short performance period (158 days) suggests urgency, implying that delivery timelines are critical and likely monitored closely. Further risk mitigation would involve robust quality assurance checks and contingency planning for supply chain issues by the Defense Logistics Agency.

How effective is the 'Full and Open Competition After Exclusion of Sources' approach in ensuring optimal value for taxpayers?

This procurement approach aims to balance broad competition with specific requirements that might necessitate excluding certain types of suppliers or technologies. 'Full and open competition' is generally beneficial for taxpayers as it encourages multiple bids, driving down prices. However, the 'after exclusion of sources' component requires careful justification. If sources were excluded without a valid technical or security reason, it could artificially limit competition, potentially leading to higher costs. The fact that 29 bids were received suggests that the exclusion did not severely hamper overall competition, but a review of the rationale for exclusion is warranted to confirm optimal taxpayer value.

What is the historical spending pattern for similar communication equipment within the Department of Defense?

Historical spending on communication equipment within the DoD is substantial and varies significantly based on technological advancements, operational needs, and the scale of deployments. Contracts for tactical radios, satellite communication systems, and network infrastructure represent billions of dollars annually. This $77.6 million contract for MOTOTRBO R7 radios fits within the broader category of tactical communication procurement. Analyzing past spending on similar radio systems, considering inflation and technological upgrades, would provide context for whether this award represents a typical investment, an increase, or a decrease in spending for this specific type of equipment.

What are the implications of the contract being awarded under a 'Service Establishment Equipment and Supplies Merchant Wholesalers' NAICS code?

The classification under NAICS code 423850 ('Service Establishment Equipment and Supplies Merchant Wholesalers') indicates that the primary function of the contractor in this transaction is the wholesale distribution of equipment and supplies for service establishments, which includes defense. This suggests that Atlantic Diving Supply, Inc. is acting as a distributor or reseller rather than the original manufacturer of the MOTOTRBO radios. This is common in government contracting, where specialized distributors can efficiently source and deliver a wide range of products. It implies that the government is leveraging the contractor's established supply chain and logistical capabilities.

Industry Classification

NAICS: Wholesale Trade › Machinery, Equipment, and Supplies Merchant Wholesalers › Service Establishment Equipment and Supplies Merchant Wholesalers

Product/Service Code: FIRE/RESCUE/SAFETY; ENVIRO PROTECT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 29

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: ADS Tactical, Inc.

Address: 621 LYNNHAVEN PKWY STE 160, VIRGINIA BEACH, VA, 23452

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $77,593,809

Exercised Options: $77,593,809

Current Obligation: $77,593,809

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $74,969,789

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SPE8EJ21D1020

IDV Type: IDC

Timeline