The Lowest Competition Federal Contracts
Justin Siken12/31/2024
Strategy Defense Civilian Technology
HigherGov
While competition levels in federal contracting have steadily increased over the past several years, the total level of competition in the federal market remains relatively low. For contracts over $25,000, the average number of bidders per solicitation in fiscal year 2024 increased slightly from the prior year, reaching 3.62.
Average Number of Bidders per Solicitation by Year
HigherGov Analysis. Includes contracts over $25,000 in value. Excludes sole source contracts.
The level of competition varies widely by the type of product or service being acquired, with many categories of products and services typically seeing fewer than 3 bids, while others see more than 10 bidders on average. For contractors that have flexibility in the products and services they sell, focusing on areas of lower competition is a common strategy to increase win rates and profit margins.
Below is a sampling of the average number of bidders in 2024 for several common NAICS and PSC codes. The analysis attached above includes bid competition levels for all 1069 NAICS and 1998 PSC codes with awards in 2024.
Average Number of Bidders by Select NAICS and PSC Code (2024)
| NAICS | Description | Ave. Bids | Ave. Bids (Excl. SS) | # of Awards | Award Potential Value |
| 541330 | Engineering Services | 2.66 | 2.91 | 10,180 | $60,879,068,729 |
| 541512 | Computer Systems Design Services | 2.64 | 3.09 | 8,683 | $48,935,213,293 |
| 541715 | Research and Development | 7.21 | 8.21 | 8,009 | $40,069,262,356 |
| 236220 | Commercial Building Construction | 3.52 | 4.09 | 12,709 | $27,993,606,613 |
| 325412 | Pharmaceutical Manufacturing | 2.17 | 2.34 | 19,906 | $18,250,602,264 |
| 541611 | Administrative Management | 2.88 | 3.61 | 6,642 | $16,134,420,617 |
| 423450 | Medical, Dental, and Hospital Equip | 27.26 | 27.36 | 748,097 | $2,979,146,365 |
| PSC | Description | Ave. Bids | Ave. Bids (Excl. SS) | # of Awards | Award Potential Value |
| R499 | Support - Professional | 3.47 | 3.57 | 50,852 | $58,537,041,024 |
| DA01 | Application Development | 2.54 | 3.11 | 5,205 | $32,162,408,352 |
| 1410 | Guided Missiles | 1.15 | 3.67 | 146 | $15,981,065,466 |
| 9130 | Liquid Propellants And Fuels, Petroleum | 5.04 | 5.41 | 218,399 | $10,243,479,049 |
| 4220 | Marine Lifesaving And Diving Equip | 27.87 | 27.94 | 16,420 | $6,481,268,255 |
| 1550 | Unmanned Aircraft | 2.56 | 3.37 | 297 | $4,928,997,862 |
| F999 | Other Environmental Services | 2.36 | 2.77 | 1,264 | $3,436,188,260 |
HigherGov Analysis
While the type of product or service being acquired is the greatest determining factor of the number of bids a solicitation will receive, other key factors include:
- Set Aside: Contracts with set-asides (excluding sole source) tend to see more competition than full & open (F&O) contracts. This is primarily because although F&O contracts do not have socioeconomic restrictions on bidding, they tend to be more complex and have more extensive prior performance requirements limiting the bidding pool. The average F&O contract had 3.0 bidders in 2025 where competition levels were much higher for Small Business (6.5 bidders), 8A (6.2 bidders), SDVOSB (4.2 bidders), and WOSB (3.3 bidders) set-asides.
- Contract Vehicle: Contracts awarded through a contract vehicle (IDIQ, BPA, MATOC, etc.), generally see slightly more competition (4.1 bidders) than contracts awarded outside of contract vehicles (3.0 bidders). While solicitations released through contract vehicles have a more limited bidder pool, the more streamlined bidding process, particularly on large vehicles like the Multiple Award Schedule, attracts more bids on average.
- Size of Contract: On average, contracts smaller than $25,000 are generally more competitive (4.6 bidders) than contracts larger than $1,000,000 (3.5 bidders).
- Agency: Competition levels can vary widely by agency depending on procurement methodologies, promotion, and other market factors. The HigherGov Market Analysis tool allows for analysis of levels of competition in particular markets (example).
