Office Depot, LLC (47QSCC-21-Q-5002)

B-420482 May 03, 2022 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Office Depot, LLC, of Columbia, Maryland, protests the terms of request for quotations (RFQ) No. 47QSCC-21-Q-5002, which was issued by the General Services Administration (GSA), for the establishment of a blanket purchase agreement (BPA) to support GSA retail operations at eight U.S. Army and U.S. Air Force locations. The protester primarily alleges that the agency's technical and price evaluation factors are unreasonable because they are based on a market basket of representative items that fails to reasonably account for the government's actual likely requirements. We sustain the protest. View Decision DOCUMENT FOR PUBLIC RELEASE The decision issued on the date below was subject to a GAO Protective Order. This version has been approved for public release. Decision Matter of: Office Depot, LLC File: B-420482 Date: May 3, 2022 John G. Horan, Esq., Faegre Drinker Biddle & Reath LLP, for the protester. Nathan C. Bangsil, Esq., and Nathan C. Guerrero, Esq., General Services Administration, for the agency. Evan D. Wesser, Esq., and Edward Goldstein, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest alleging that a solicitation’s technical and price evaluation factors are unreasonable because they fail to reasonably reflect the government’s anticipated requirements is sustained where the evaluation scheme was predicated on consideration of incomplete historical sales information. DECISION Office Depot, LLC, of Columbia, Maryland, protests the terms of request for quotations (RFQ) No. 47QSCC-21-Q-5002, which was issued by the General Services Administration (GSA), for the establishment of a blanket purchase agreement (BPA) to support GSA retail operations at eight U.S. Army and U.S. Air Force locations. The protester primarily alleges that the agency’s technical and price evaluation factors are unreasonable because they are based on a market basket of representative items that fails to reasonably account for the government’s actual likely requirements. We sustain the protest. OVERVIEW This protest challenges GSA’s attempt to use a single BPA to consolidate the purchase of hardware and industrial supply items, and office supply items, and to permit these items to be ordered by eight Army and Air Force locations. Although the BPA will permit the ordering of tens of thousands of available items, GSA attempted to develop a representative market basket of the 200 most frequently purchased items to evaluate and compare the pricing received from competing vendors. The market basket was developed after examining historical sales data, which was limited in most instances to past purchases of hardware and industrial supply items. As discussed in more detail below, the record does not support the market basket’s ratio of hardware and industrial supply items to office supply items. In short, the agency’s overreliance on the data available on historical sales of hardware and industrial items--to the exclusion of data on the historical sales of office supply items--resulted in the use of a market basket of sample items that did not reasonably represent the likely purchases of office supply items. BACKGROUND GSA’s Retail Operations group provides what GSA has termed Fourth-Party Logistics (4PL) solutions for Department of Defense and civilian agencies. According to GSA, the 4PL program allows users to focus on core competencies by leveraging GSA’s contracting and acquisition experience and the product-fulfillment expertise of industry leaders. Under 4PL, GSA acts as an integrator to manage multiple suppliers specializing in: tools; hardware; maintenance, repair, and operations (MRO) supplies; and office supplies. The 4PL program uses a single entity (GSA Retail Operations) to manage acquisition, storage, merchandising, delivery, and billings aspects of a comprehensive supply solution. “GSA Retail Operations,” available at https://www.gsa.gov/buying-selling/purchasing-programs/requisition-prog… (last visited Apr. 26, 2022). The RFQ, which was issued on December 2, 2021, and subsequently amended once, seeks quotations from all contractors--or contractor teaming arrangements comprised of vendors--holding contracts under GSA Multiple Award Schedule Large Category G with the following Special Item Number: 4PL Supplies and Services. The RFQ anticipated the establishment of a single BPA to support GSA Retail Operations at various U.S. Army and U.S. Air Force locations. Agency Report (AR), Tab 3, RFQ, amend. No. 1 at 1. Under the resulting BPA, the vendor will provide a comprehensive supply solution so that these locations will be able to provide products and related in-store services for brick and mortar stores, tool rooms/issue points, in-store referral ordering, and direct delivery services. Id. at 4.