How Do I Do Market Research for Government Contracting?

Why Market Research Matters

Most businesses that fail to win federal contracts don't fail because they weren't qualified. They fail because they didn't research the market before submitting. Without market research, you are guessing on price, scope, and competition. With it, you know what agencies pay, who you're competing against, and whether a contract is winnable.

Federal market research is not optional for serious contractors — it is the foundation of a winning proposal strategy.

The Three Questions Market Research Answers

1. Does this agency buy what I sell?

Not every agency buys every type of service. A VA hospital needs medical services, janitorial services, and IT support — but not manufacturing equipment. Knowing which agencies are active buyers in your NAICS code saves months of wasted proposal effort.

2. Who has the current contract?

The incumbent contractor has significant advantages in a recompete. Knowing who they are, how long they've held the contract, and what they're paid tells you the competitive landscape before you write a single word of your proposal.

3. What is the government paying?

Federal contracts are public record — including the amounts. Pricing too high loses the competition. Pricing too low raises red flags. Knowing historical award amounts gives you a defensible price range.

Step-by-Step Market Research Process

Step 1: Identify your NAICS codes

Before anything else, confirm which NAICS codes describe your services. Use govprocure's NAICS lookup or the Census Bureau's official tool. Register all applicable codes on SAM.gov.

Step 2: Search USASpending.gov for past awards

Go to usaspending.gov → Award Search → filter by your NAICS code → set award type to "Contracts" → set a 3-year date range. Review the results:

• Which agencies appear most frequently? Those are your target agencies.
• What amounts were awarded? Those are your pricing benchmarks.
• Which companies won? Those are your competitors.

Step 3: Search SAM.gov for current solicitations

Go to sam.gov → Contract Opportunities → filter by NAICS code. Look for:

• Active solicitations you can bid on now
• Presolicitation notices (upcoming opportunities — get ready)
• Sources Sought notices (agency market research — respond to get on their radar)

Step 4: Research the incumbent

Once you identify who holds current contracts, research them:

• Search their name on SAM.gov to see their registrations and certifications
• Search USASpending.gov for their full award history with that agency
• Look at their website and capabilities statement

Step 5: Build your target agency list

Based on your research, identify 5-10 agencies that are active buyers in your NAICS code. Focus your business development on these agencies specifically — attend their industry days, reach out to contracting officers, and monitor their solicitations on SAM.gov.

Tools for Federal Market Research