0416R0040_J A.pdf

Control Number: HDEC04-16-35

JUSTIFICATION REVIEW DOCUMENT

Description of Acquisition: Maintenance of Hobart Brand Name Food Weigh/Wrap Equipment for 69 commissaries located throughout the Continental United States, Alaska and Hawaii.

Statutory Authority: 10 U.S.C. 2304(c) (1), Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements, as implemented by FAR 6.302-1.

Estimated Contract Amount:

Estimated Value Base Period: $1,304,397.00;

Estimated Value First Option: $1,322,383.00;

Estimated Value Second Option: $1,340,635.00;

Estimated Value Third Option: $1,358,711.00;

Estimated Value Fourth Option: $1,377,516.00;

Total Estimated Value Base and all Option Periods: $6,703,642.00

Performance Period:

Base Period: January 1, 2017 – December 31, 2017 First Option: January 1, 2018 - December 31, 2018 Second Option: January 1, 2019 - December 31, 2019 Third Option: January 1, 2020 - December 31, 2020 Fourth Option: January 1, 2021 - December 31, 2021

Prepared By: Michael Conwell Phone: 804-734-8000 x48251

Supply Management Specialist

Technical: Rebecca Barefoot Phone: 804-734-8000 x48085

Supply Management Specialist

Technical: Russell F. Ellison Phone: 804-734-8000

Supply Management Specialist

Requirements: Chris Coppler Supervisory Supply Management Specialist Phone: 804-734-8000 x48023

PCO: Diana Gross-Bendall Contracting Officer Phone: 804-734-8000 x48185

Required Review Signatures: We have reviewed this J&A and find the justification adequate to support other than full and open competition.

Program Manager: N/A

Legal Counsel: Nikki Salunga Phone: 804-734-8000 x48116

Signature: Date:

Division Chief: Richard Broda Phone: 804-734-8000 x48882

Signature: Date:

Competition Floyd Kirkland Phone: 804-734-8000 x86223

Advocate: Signature: Date:

KIRKLAND.FLOYD

.L.JR.1067833224

Digitally signed by

KIRKLAND.FLOYD.L.JR.1067833224

DN: c=US, o=U.S. Government, ou=DoD, ou=PKI, ou=DECA, cn=KIRKLAND.FLOYD.L.JR.1067833224 Date: 2016.08.18 11:56:33 -04'00'

JUSTIFICATION AND APPROVAL

FOR OTHER THAN FULL AND OPEN COMPETITION

1. Contracting Office Defense Commissary Agency Supply/Equipment Acquisition Division, LEAE 1300 E. Avenue Fort Lee, Virginia 23801-1800

2. Type of Contract Action – The type of action contemplated is a Firm Fixed Price type contract. Payment will be made using Invoicing, Receipt, Acceptance, and Property Transfer (iRAPT).

3. Description of Supplies/Services – The Defense Commissary Agency, Logistics and Engineering Division (LELE), has an on-going requirement to full-burden obtain maintenance on Hobart Brand Weigh/Wrap Equipment (auto-wrappers and scales) for the commissaries located in the Continental United States, Alaska and Hawaii. The anticipated base period will be January 1, 2017 through December 31, 2017. The solicitation shall include the base and four one-year option periods, which may extend the contract performance until December 31, 2021. The estimated contract value for the base and four option periods is $6,703,642.

In the event DeCA gains additional stores with Hobart equipment and requires maintenance, this J&A will be amended prior to adding the stores on the maintenance contract.

4. Authority Cited - Statutory Authority 10 U.S.C. 2304(c) (1), as implemented by FAR 6.302-1, Only One Responsible Source and No Other Supplies or Services Will Satisfy Agency Requirements.

5. Reason for Authority Cited - Proprietary Maintenance/Repair. Hobart is the manufacturer of the weigh/wrap equipment and holds all rights to parts required to maintain and repair this equipment. A total of 69 CONUS commissary stores use Hobart food processing equipment such as meat auto-wrappers and scales. This equipment is necessary for operation of the stores’ meat, deli/bakery and produce departments. Only authorized Hobart service partners/repair technicians are able to obtain Hobart manufactured repair parts and the required specialized training necessary to perform maintenance on Hobart equipment. Hobart’s comprehensive training curriculum and certification program are restricted to Hobart employees. The proprietary service tools needed to repair/maintain Hobart equipment, software and firmware are issued to authorized service partners; however, Hobart parts and accessories can be sold directly to customers or third party providers. Hobart’s exclusive service network has access to their technical support team; however, if a customer has a technical support question the customer can contact a local Hobart office directly. This restriction on the availability of Hobart parts and training limits maintenance providers to authorized dealers in the Hobart network. Warranties become voided if unauthorized contractors perform maintenance on Hobart equipment.

6. Efforts to Obtain Competition - To further enhance competition and locate other sources that are capable of meeting the government requirement, the synopsis and solicitation will be posted on FedBizOps.

7. Fair and Reasonable Cost Determination – Price analysis will be conducted to compare pricing with contracts similar in scope on the same type of equipment.

8. Market Research and Interested Sources - Market research was conducted, to determine if there were small or large businesses available to provide maintenance and repairs on Hobart brand equipment for the sixty-nine (69) commissary locations. Market research started with review of previous contract to determine if there were any interested vendors during the solicitation phase.

One vendor, The Remi Group, showed interest in this requirement but did not submit a proposal.

The Remi Group was contacted to get more information about their service network, how they will provide service to DeCA commissaries and why they did not submit proposal to previous solicitation. The Remi Group indicated that it serves as a middle man between the government and OEM business entities. The basis of their operation is to “address any issues directly with the vendor on the agency’s behalf…” The Remi Group does not possess its own service technicians, service providers or service centers. Based on this information about The Remi Group, it is determined that it is not a viable vendor for this type of service that would be in the best interest of the government.

It was also discovered that Hobart Corporation has tight restrictions on who can have access to repair Hobart brand equipment and how they can acquire repair parts. Hobart has stated that all technicians located at various Hobart branch offices are actual Hobart employees who are the only employees/technicians that have access to acquire repair parts and are trained and certified on Hobart equipment. Hobart does not authorize nor trains other technicians outside of the Hobart Corporation. This was further validated during FY07 whereas attempts were made to contract with other sources; however, these contractors experienced challenges in obtaining parts from Hobart, which resulted in the work being subcontracted to Hobart. To remedy the situation and to avoid uninterrupted service to the stores, all equipment was added to the Hobart maintenance contract; HDEC04-07-C-0003. Subsequent requirements for Hobart maintenance service have been solicited on a sole source basis. Therefore, a Justification and Approval was obtained to justify soliciting under a sole source basis for solicitation HDEC04-11-R-0013 which resulted in six contracts, HDEC04-11-C- 0001, HDEC04-11-C-0002, HDEC04-11-C-0003, HDEC04-11-C- 0004, HDEC04-11-C-0005 and HDEC04-11-C-0006; each covering a specific geographic area.

Further market research included searches through applicable databases such as the Small Business Administration’s Dynamic Small Business Search, ThomasNet, Manta and Google.

Although, several vendors were revealed during these searches using NAICS code 811219 (Other Electronic & Precision Equipment Repair & Maintenance) further research of each vendor determined that none of the vendors provided maintenance and repair on the type of equipment solicited for and at the volume DeCA requires.

Based on the current market research and previous history of this type of requirement it is recommended to continue to solicit this type of requirement as a sole source to Hobart Corporation for maintenance and repair on meat wrapping systems and scales. Based on the above facts, the issuance and subsequent posting of a sources sought notice would result in no additional benefits to the Government. A waiver from the requirement of DFARS PGI 206-302-1 to issue a Sources Sought has been requested from the Head of the Contracting Agency.

9. Actions to Increase/Foster Competition - To further enhance competition and locate other sources that are capable of meeting the government requirement, the synopsis and solicitation will be posted on FedBizOps.

10. Other Factors -

a. Procurement History - The current Hobart contracts were solicited as a sole source acquisition. The contract numbers are: HDEC04-11-C-0001; HDEC04-11-C- 0002;

HDEC04-11-C-0003; HDEC04-11-C-0004; HDEC04-11-C-0005 and HDEC04- 11-C- 0006. These contracts were awarded on 29 June, 2011 as a firm, fixed price contract with a base year and four option years.

b. Subcontracting Competition – Hobart does not employ the use of subcontractors. All Hobart service technicians are direct employees of the Hobart Corporation.

11. Technical Certification:

I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

Name: Rebecca Barefoot Signature:

Title: Supply Management Specialist Date:

Name: Russell Ellison Signature:

Title: Supply Management Specialist Date:

Name: Michael Conwell Signature:

Title: Supply Management Specialist Date:

12. Requirements Certification:

I certify that the supporting data under my cognizance, which are included in this justification, are accurate and complete to the best of my knowledge and belief.

Name: Chris Coppler Signature:

Title: Supervisory Supply Management Specialist Date:

13. Fair and Reasonable Price Determination and Contracting Officer Certification:

I hereby determine that the price for this contract action will be fair and reasonable. It will be based on price analysis comparing pricing of similar contracts and rates from other maintenance agreements for similar equipment. Hobart's store support and past performance has been excellent. I certify that this J & A is accurate and complete to the best of my knowledge and belief.

Name: Diana Gross-Bendall Signature:

Contracting Officer Date:

APPROVAL

Based on the foregoing justification, I hereby approved the procurement of maintenance and repair services on an other than full and open competition basis pursuant to the authority of 10 U.S.C. 2304(c)(1), provided funds are available, or will be available, and provided that the services herein described have otherwise been authorized for acquisition.

APPROVED:

Signature:

Floyd Kirkland DeCA Competition Advocate

Date:

KIRKLAND.FLOYD

.L.JR.1067833224

Digitally signed by

KIRKLAND.FLOYD.L.JR.1067833224

DN: c=US, o=U.S. Government, ou=DoD, ou=PKI, ou=DECA, cn=KIRKLAND.FLOYD.L.JR.1067833224 Date: 2016.08.18 11:57:20 -04'00'