VA awards $24.8M for enterprise-wide PC and monitor refresh, highlighting Dell's role in IT modernization

Contract Overview

Contract Amount: $24,864,048 ($24.9M)

Contractor: Dell Marketing L.P.

Awarding Agency: Department of Veterans Affairs

Start Date: 2011-07-21

End Date: 2016-02-22

Contract Duration: 1,677 days

Daily Burn Rate: $14.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: ENTERPRISE-WIDE PC AND MONITOR REFRESH CONTRACT

Place of Performance

Location: AUSTIN, TRAVIS County, TEXAS, 78744

State: Texas Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $24.9 million to DELL MARKETING L.P. for work described as: ENTERPRISE-WIDE PC AND MONITOR REFRESH CONTRACT Key points: 1. Contract value represents a significant investment in upgrading essential IT hardware for the VA. 2. The award was made under full and open competition, suggesting a competitive bidding process. 3. The duration of the contract (over 4 years) indicates a long-term strategy for hardware lifecycle management. 4. The firm-fixed-price structure provides cost certainty for the government. 5. This contract aligns with broader federal IT modernization efforts to improve agency infrastructure. 6. The geographic location of the awardee in Texas may have implications for regional IT support.

Value Assessment

Rating: good

The contract value of $24.8 million for an enterprise-wide PC and monitor refresh appears reasonable given the scope and duration. Benchmarking against similar large-scale IT hardware refresh contracts across federal agencies would provide a more precise value-for-money assessment. The firm-fixed-price contract type helps manage cost risks for the VA. However, without specific details on the number of units or types of equipment procured, a definitive value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 8 bidders suggests a healthy level of competition for this significant IT hardware contract. A competitive process generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: The robust competition for this contract likely resulted in cost savings for taxpayers by driving down prices and encouraging innovative solutions from multiple vendors.

Public Impact

Veterans Affairs (VA) employees benefit from updated and reliable computing equipment, improving their ability to serve veterans. The contract supports the delivery of essential IT infrastructure services to the VA's nationwide operations. The geographic impact is nationwide, as the VA operates across the United States. The contract supports the IT hardware manufacturing and distribution workforce, primarily through Dell's operations.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if refresh cycles are not managed effectively.
Risk of obsolescence if technology refresh is not aligned with rapid IT advancements.
Dependence on a single vendor (Dell) for a critical IT infrastructure component.

Positive Signals

Awarded through full and open competition, indicating a competitive market.
Firm-fixed-price contract provides cost predictability.
Long contract duration suggests a strategic approach to IT asset management.
Awardee is a well-established IT hardware provider with a track record.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on computer hardware procurement. The market for enterprise IT hardware is large and competitive, with major players like Dell, HP, and Lenovo vying for government contracts. This award represents a significant portion of the VA's annual IT hardware spending, contributing to the overall modernization of federal IT infrastructure and supporting the broader electronics manufacturing industry.

Small Business Impact

While this contract was awarded to Dell Marketing L.P., a large business, there is no explicit information regarding small business set-asides or subcontracting plans. Large IT hardware contracts often involve complex supply chains where small businesses can play a role as suppliers or service providers. Further analysis would be needed to determine the extent of small business participation in the fulfillment of this contract.

Oversight & Accountability

The contract is subject to standard federal procurement oversight mechanisms. The firm-fixed-price nature of the contract provides a degree of financial oversight. Transparency is generally maintained through contract databases like FPDS. The VA's Office of Inspector General would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Federal Information Technology Acquisition Reform Act (FITARA) initiatives
VA IT Modernization Programs
General Services Administration (GSA) Schedule contracts for IT hardware
Enterprise IT Refresh Programs across federal agencies

Risk Flags

Long contract duration may lead to technology obsolescence if not managed.
Potential for vendor lock-in with a single provider for critical hardware.
Lack of detailed performance metrics in summary data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $24.9 million to DELL MARKETING L.P.. ENTERPRISE-WIDE PC AND MONITOR REFRESH CONTRACT

Who is the contractor on this award?

The obligated recipient is DELL MARKETING L.P..

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $24.9 million.

What is the period of performance?

Start: 2011-07-21. End: 2016-02-22.

What is the historical spending trend for enterprise-wide PC and monitor refreshes at the VA?

Historical spending data for enterprise-wide PC and monitor refreshes at the Department of Veterans Affairs (VA) indicates a consistent need for hardware upgrades. Prior to this $24.8 million award, the VA has engaged in multiple contracts for similar purposes, often spread across different fiscal years and potentially involving various vendors or delivery orders. Analyzing spending patterns over the last 5-10 years would reveal the average annual investment in hardware refreshes, the typical contract values, and whether there's a trend towards larger, consolidated contracts like this one or a more distributed approach. Understanding these historical patterns is crucial for budgeting, forecasting future needs, and assessing the efficiency of current procurement strategies. For instance, if past spending was significantly lower or higher, it would prompt questions about the current contract's scope, pricing, or the evolving IT requirements of the VA.

How does the per-unit cost of PCs and monitors under this contract compare to market rates or similar federal contracts?

A detailed comparison of the per-unit cost for PCs and monitors under this $24.8 million VA contract against prevailing market rates and similar federal procurements is essential for assessing value for money. While the contract is firm-fixed-price, the actual unit prices are not explicitly detailed in the provided data. Benchmarking would involve obtaining the specific models and quantities procured and comparing their prices to those available through GSA Schedules, other agency contracts, or commercial price lists. Factors such as volume discounts, specific configurations, warranty terms, and delivery requirements significantly influence unit costs. If the per-unit costs are found to be higher than comparable contracts or market prices, it could indicate potential overspending or a lack of aggressive negotiation, even within a competitive bidding environment. Conversely, costs aligned with or below benchmarks would suggest effective price discovery and good value.

What are the specific performance metrics and service level agreements (SLAs) associated with this hardware refresh contract?

The provided data does not detail the specific performance metrics or service level agreements (SLAs) tied to this $24.8 million VA PC and monitor refresh contract. However, for a contract of this magnitude and duration, robust performance expectations are typically established. These would likely include metrics related to delivery timelines, equipment reliability (e.g., mean time between failures), warranty support response times, and potentially end-of-life disposal services. SLAs would define the acceptable standards for these metrics and outline remedies or penalties for non-compliance. The effectiveness of the contract in achieving its objectives—providing reliable and up-to-date IT equipment to VA staff—is heavily dependent on the clarity and enforceability of these performance standards and SLAs. Without this information, a full assessment of the contractor's performance and the overall success of the contract is incomplete.

What is Dell Marketing L.P.'s track record with similar large-scale federal IT hardware refresh contracts?

Dell Marketing L.P. has a substantial track record of securing and executing large-scale federal IT hardware refresh contracts across various agencies. As a major original equipment manufacturer (OEM) and direct vendor, Dell frequently appears as an awardee for enterprise-wide procurements of desktops, laptops, and monitors. Their history includes numerous awards from agencies such as the Department of Defense, NASA, and other civilian departments, often through competitive bidding processes and via GSA Schedules. Evaluating Dell's past performance on similar contracts would involve reviewing contract completion data, any reported performance issues or successes, and their overall market share within the federal IT hardware space. Their consistent presence suggests a capability to meet the demanding requirements of government IT modernization efforts, including logistics, support, and adherence to security standards.

What are the potential risks associated with a single vendor (Dell) providing enterprise-wide hardware for an extended period?

A significant risk associated with relying on a single vendor, such as Dell, for an enterprise-wide hardware refresh over an extended period (like the 1677 days duration of this contract) is the potential for vendor lock-in and reduced future competition. This can manifest in several ways: the VA might become heavily reliant on Dell's specific technologies, making it difficult or costly to switch to alternative vendors or platforms in the future. Pricing for subsequent contracts could potentially increase if Dell faces less competitive pressure. Furthermore, the pace of technological innovation might outstrip the refresh cycle, or the VA's specific needs could evolve in ways not optimally met by Dell's standard offerings. Managing these risks requires proactive contract management, clear exit strategies, and continuous market analysis to ensure ongoing value and flexibility.

Industry Classification

NAICS: Manufacturing › Computer and Peripheral Equipment Manufacturing › Electronic Computer Manufacturing

Product/Service Code: INFORMATION TECHNOLOGY EQUIPMENT (INCLD FIRMWARE) SOFTWARE,SUPPLIES& SUPPORT EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Dell Technologies Inc. (UEI: 601839660)

Address: ONE DELL WAY, ROUND ROCK, TX, 78682

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $24,864,048

Exercised Options: $24,864,048

Current Obligation: $24,864,048

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: VA798A11P0280

IDV Type: IDC

Timeline