LSJ (Office Depot USMC Follow-On) Redacted.pdf

General Services Administration Federal Acquisition Service

General Supplies and Services Central Office Acquisition Division

Retail Operations Acquisition Branch

LIMITED SOURCES JUSTIFICATION

DESCRIPTION OF ACTION – LOGICAL FOLLOW-ON

GSA MAS CONTRACT NUMBER: 47QSEA20D005Q

RFQ NUMBER: QSABA-RFQ-20008

The General Services Administration (GSA) makes this Limited Sources Justification (LSJ) pursuant to Federal Acquisition Regulation (FAR) 8.405-6(a)(1)(i)(C).

1) Identification of Agency and Contracting Activity

Client Agency: General Services Administration (GSA)

Office of General Supplies and Services (GSS) Office of Retail Operations (RO)

Contracting Activity: Central Office Acquisition Division

Office of General Supplies and Services GSA Federal Acquisition Service 1800 F Street, NW Washington, D.C. 20405

2) Nature and/or description of action being approved

The action being approved is a logical follow-on to Blanket Purchase Agreement (BPA) GS- 23F-GA026, in accordance with (IAW) FAR 8.405-6(a)(1)(i)(C). This justification authorizes Office Depot, Inc. (Office Depot) to continue performance at various United States Marine Corps (USMC) locations. This logical follow-on BPA is in the interest of economy and efficiency, as outlined below.

Background

On July 15, 2017, GSA established a Blanket Purchase Agreement (GS-23F-GA026) with Office Depot under Office Depot’s GSA Multiple Award Schedule (MAS) 75 contract, number GS- 14F-0040K. This BPA was established as a result of solicitation QSRA-RFQ-17100, issued February 15, 2017. It was competed under MAS 75, open to all MAS 75 vendors holding SINs 75-200 and 75-210. As established, the BPA included a base year and two option years, extending the period of performance to July 14, 2020. Additional option periods were not included because Office Depot’s underlying MAS 75 contract will end on September 19, 2020.

IAW FAR 8.405-3(d)(3), “contractors may be awarded BPAs that extend beyond the current term of their GSA Schedule contract, so long as there are option periods in their GSA Schedule contract that, if exercised, will cover the BPA’s period of performance.” In addition the clause at

I-FSS-646, as incorporated into GS-14F-0040K, specifies that the contractor agrees to enter into BPAs with ordering activities provided that “the period of time covered by such agreements shall not exceed the period of the contract including option year period(s).” Therefore, allowing the BPA to extend past September 19, 2020 would have conflicted with FAR 8.405-3(d)(3) and the clause at I-FSS-646. Accordingly, the BPA excluded additional option years and will end on July 14, 2020.

The USMC requirements for office supplies will eventually be included in GSA’s NextGen 4PL BPAs, which were expected to be established in April 2020, but due to delays associated with a sustained protest (B-418141.1, sustained on January 16, 2020), are now anticipated to be established mid-2021. Accordingly, this Limited Source Justification will establish a short-term BPA under Office Depot’s new consolidated MAS contract, number 47QSEA20D005Q, in the interest of economy and efficiency in order to ensure coverage at the various USMC locations until the NextGen BPAs are established and operational.

The performance periods for this logical follow-on BPA will be as follows:

Base Period (12 months) - July 15, 2020 to July 14, 2021 Option Period 1 (6 months) - July 15, 2021 to January 14, 2022

3) Description of Supplies/Services Required to Meet the Agency’s Needs

Under the current BPA, Office Depot provides GSA and its customers with office supplies at the following USMC locations: Marine Corps Base (MCB) Camp Lejeune, NC; MCB Quantico, VA; MCB Camp Pendleton, CA; MCB Camp Butler, Okinawa Japan; Marine Corps Logistics Base (MCLB) Albany, GA; MCLB Barstow, CA; Marine Corps Air Ground Combat Center 29 Palms, CA; Marine Corps Air Station (MCAS) New River, NC; MCAS Iwakuni, Japan; and Marine Corps Base Hawaii Kaneoke Bay, HI.

For CONUS locations, including Hawaii, the products are provided via vendor owned/vendor managed inventory (VMI). The contractor also provides on-site management and oversight of inventory levels, stocking/restocking of shelves, customer service, processing referral orders for items such as paints, preservatives, sealants, adhesives, oils and abrasives, power tools, accessories, hardware, building supplies, safety products, precision tools and equipment, machinery and tooling components, tool holding and work holding equipment, outdoor equipment and accessories, material handling, fire fighting and rescue equipment, and protective gear. For OCONUS locations, the products are provided via vendor-consigned inventory (VCI).

Based on average annual sales, the estimated value of this logical follow-on BPA is $65.6 million.

4) Authority and Supporting Rationale

This action is conducted under the authority of the MAS program and in accordance with the following FAR provision:

FAR 8.405-6(a)(1)(i)(C) – In the interest of economy and efficiency, the new work is a logical follow-on to an original Federal Supply Schedule order provided that the original order was placed in accordance with the applicable Federal Supply Schedule ordering procedures.

BPA GS-23F-GA026 will expire on July 14, 2020. Although GSA originally intended to have NextGen BPAs established by then, necessary actions taken as a result of the sustained protest have delayed the NextGen procurement process. Without this logical follow-on BPA, there will be a break in service at the various USMC locations.

Even if GSA were to separately compete a new BPA for this requirement at this point, there would likely be a break in service because of the time required to onboard and transition a new vendor, to include sourcing product, complying with security access requirements, and transporting/staging inventory at the location. Further, issuing a separate RFQ for this requirement, which is already included in the ongoing NextGen procurement, would be counterproductive and duplicate GSA’s work and administrative costs. Finally, local individual procurements for these supplies are not in the interest of economy and efficiency because that would be a duplication of GSA’s efforts in the NextGen procurement and would also likely result in a gap in service.

Additionally, under the existing BPA, Office Depot is required to continually transport stock and on-hand inventory to the store location. Should the Government attempt to re-compete this procurement and establish a new short-term BPA with another vendor until the NextGen procurement is operational, this already transported stock and on-hand inventory would have to be transported out of the store location. The new, short-term BPA holder would then have to transport its own stock and on-hand inventory necessary to support the location until the NextGen BPAs are established. When the NextGen BPAs are in place, the short-term BPA holder will be required to transport stock and on-hand inventory out of the store and the new NextGen BPA holder will be required to transport stock and on-hand inventory back in. It is not in the Government’s interest of economy and efficiency to incur such duplication of effort and costs. It is neither economically sound nor in the best interest of the Government to competitively establish a new short-term BPA for the limited period of performance.

The duplicative efforts and costs will not be recovered through re-competition. Establishing a new short-term BPA and onboarding another vendor at these locations would require complete duplication of these tasks, at additional expense and effort. With this logical follow-on BPA, GSA will avoid the substantial duplication of efforts and resources and the additional costs. GSA will also be able to seamlessly continue service at the various USMC locations until the NextGen procurement is in place.

Further, this logical follow-on BPA will allow the Government to continue to receive cost savings associated with the currently established 4PL BPA. When the BPA was established, Office Depot proposed category discounts that apply to all sales under the BPA. This logical follow-on BPA will allow GSA to continue to capitalize on those discounts as sales continue.

Establishment of this logical follow-on BPA is the most economical approach for the customer and GSA because it allows the Government to continue to capitalize on these previously established discounts and avoids substantial duplication of resources, efforts, and costs, supporting GSA’s customer requirements without any interruption in service or customers’ access to mission critical office products.

5) Determination by the Ordering Activity Contracting Officer that the Order Represents the Best Value Consistent with FAR 8.404(d)

The undersigned Ordering Activity Contracting Officer has determined that this logical follow-on BPA represents the best value and results in the lowest overall cost alternative (considering price, special features, and administrative costs) to meet the Government’s needs. To date, Office Depot has under BPA GS-23F-GA026, and is the only vendor with capability and employees at the BPA locations to continue to provide products without a break in service. In addition, per FAR 8.404(d), Office Depot’s MAS 75 schedule prices are fixed prices already determined to be fair and reasonable, for products purchased under this BPA.

6) Description of the Market Research Conducted Among Schedule Holders and the Results of the Research

GSA considered alternatives to this logical follow-on BPA, such as leveraging other established 4PL locations to support the locations covered by the BPA; however these requirements would be outside the geographical and contractual scope of any other 4PL BPA.

The Market Research has shown that the MAS Program continues to be the most economically sound and efficient acquisition solution for the GSA 4PL program to provide office supplies for its customers. This logical follow-on BPA will ensure continuity of service, until the NextGen successor BPA holder is operational.

7) Other Facts Supporting the Justification

Under this BPA, Office Depot maintains warehouse stock and performs a high number of referral orders. As of March 23, 2020, there was inventory at these locations. Should the Government attempt to issue a bridge BPA to another vendor, the USMC would no longer have access to prepositioned inventory at these locations.

8) Statement of the Actions, if any, the Agency May Take to Remove or Overcome any Barriers that Led to the Restricted Consideration Before Any Subsequent Acquisition for the Supplies or Services is Made

Through the NextGen procurement, the Agency is restructuring its 4PL procurement approach, which will increase competition and procure 4PL services on an enterprise-wide basis, rather than individual installations.

Technical/Requirements Personnel Certification:

I certify that the requirements for this acquisition, as depicted in the Statement of Work of this BPA and that the supporting data, which forms the basis for the justification, is accurate and complete.

William Crenshaw Date Director of Operations Retail Operations Branch

GSA/FAS/GSS/QSR

CONCUR:

Paul Mack Date Director Retail Operations Branch

GSA/FAS/GSS/QSR

Contracting Officer’s Certification:

I hereby certify that this justification is accurate and complete to the best of my knowledge and belief, and determine on the basis of the findings above that the limited sources approach is in accordance with the requirements and is in the best interest of the Government.

Mary Kate Koch Date Contracting Officer (Senior Unlimited Warrant) Retail Operations Acquisition (QSABA)

4/15/2020

CONCUR:

Carolyn Long Date Branch Chief, Retail Operations Acquisition (QSABA)

Stephen Smith Date Director, Central Office Acquisition Division (QSAB)

Mark Dunkum Date Director, GSS Acquisition Management (QSA)

Beth Folz Date Competition Advocate, (GSA/FAS/GSS)

APPROVED:

Based on the aforementioned discussion for the use of other than full and open competition, I find that the foregoing circumstances justify limiting sources in accordance with FAR 8.405- 6(a)(1)(i)(C) and approve this justification.

Robert Noonan Date Head of the Contracting Activity Assistant Commissioner Office of General Supplies and Services

GSA, FAS

4/17/2020

4/17/2020

4/17/2020