Matter of: OfficeMax, Inc.

B-299340.2 Jul 19, 2007 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights OfficeMax, Inc. protests the award of a contract to Corporate Express under request for quotations (RFQ) No. TIRNO-06-Q-00031, issued by the Internal Revenue Service (IRS) for delivery of office supplies. The protester contends that the IRS unreasonably determined that its quotation was technically unacceptable, and also failed to conduct meaningful discussions. We deny the protest. View Decision B'299340.2, OfficeMax, Inc., July 19, 2007 DOCUMENT FOR PUBLIC RELEASE The decision issued on the date below was subject to a GAO Protective Order. This redacted version has been approved for public release. Decision Matter of: OfficeMax, Inc. File: B'299340.2 Date: July 19, 2007 Lee P. Curtis, Esq., Troy E. Hughes, Esq., and Eric A. Aaserud, Esq., Perkins Coie LLP, for the protester. Kristen E. Ittig, Esq., Arnold & Porter LLP, for Corporate Express, an intervenor. David K. Barnes, Esq., and Lori R. Larson, Esq., Internal Revenue Service, for the agency. Jonathan L. Kang, Esq., and Ralph O. White, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1. Agency reasonably determined that vendor's quotation was technically unacceptable where it failed to comply with a mandatory solicitation requirement. 2. Protest that agency failed to provide meaningful discussions is denied where protester cannot establish prejudice because the record shows that protester's ordering systems for office supplies did not comply with a mandatory solicitation requirement, and shows that the protester did not plan to become compliant. DECISION OfficeMax, Inc. protests the award of a contract to Corporate Express under request for quotations (RFQ) No. TIRNO-06-Q-00031, issued by the Internal Revenue Service (IRS) for delivery of office supplies. The protester contends that the IRS unreasonably determined that its quotation was technically unacceptable, and also failed to conduct meaningful discussions. We deny the protest. This office supply procurement protest involves a single issue--an RFQ requirement for an ordering management system that the IRS has termed its –fill or kill— policy, and the protester's commitment to comply with this policy in its quotation. The policy, in essence, requires the vendor to provide an order management service (in addition to providing the office supplies) that either completely –fills— each line item of an order for office supplies, or –kills,— i.e. completely rejects, any line item that cannot be filled entirely, so that the purchasing entity can seek the supplies from another vendor. Simply put, the IRS wants no partially-filled line items. Ultimately, this decision concludes that: (1) the fill or kill policy was a material requirement of the RFQ; (2) the OfficeMax quotation was reasonably rejected for its failure to comply with this requirement; (3) the IRS did not advise OfficeMax during discussions that its failure to comply with this policy was a deficiency that would result in the disqualification of its quotation; and (4) OfficeMax was not prejudiced by the lack of discussions, since the record indicates that OfficeMax could not provide the fill or kill service the agency required. BACKGROUND On April 28, 2006, the IRS issued this RFQ seeking quotations to provide next-day-desktop delivery of office supplies to approximately 6,500 order points (defined in the solicitation as IRS employees authorized to place orders) at 800 IRS facilities in the 48 contiguous United States. The RFQ anticipated issuance of one or more blanket purchase agreements (BPAs) with a 1-year base term, and four 1-year options. Competition was limited to vendors who hold contracts under General Services Administration Federal Supply Schedule (FSS) contract No. 75 II A, Office Supplies Products and Equipment. The solicitation advised vendors that award of a BPA would be made to –the offeror or offerors whose quote contains the combination of technical and price features offering the best overall value to the IRS.— RFQ, Statement of Work (SOW), sect. 11.0. As relevant to the protest, the SOW contained a fill or kill policy, defined as follows: Orders faxed, placed by telephone, or transmitted electronically before 2:00 p.m., each day, for which acknowledgement from the contractor is received by the IRS, are subject to the –fill or kill— policy. –Fill— is the requirement that all supplies ordered be delivered within 24 hours of the order placement. –Kill— is the requirement that those supplies not available for next day delivery are canceled from the order. Thus, there will be no back orders on individual orders. RFQ, SOW, sect.