How to Conduct Market Research for Government Contracts
Market research is the foundation of every successful government contract pursuit. Federal Acquisition Regulation (FAR) Part 10 requires agencies to conduct market research before every acquisition — and smart contractors do the same research from their side of the table.
This guide walks you through the complete market research process: understanding the regulatory requirements, leveraging free federal data sources, analyzing your competition, and documenting your findings to support better bid/no-bid decisions.
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FAR Part 10: Market Research Requirements
FAR Part 10 mandates that agencies conduct market research to determine whether commercial products or services are available to meet government needs. This research must occur before developing new requirements documents, before soliciting offers, and before awarding contracts.
The regulation establishes two levels of market research. FAR 10.001 requires agencies to conduct market research appropriate to the circumstances, while FAR 10.002 details the specific techniques agencies should use, including contacting knowledgeable individuals, reviewing published information, and querying commercial databases.
For contractors, understanding FAR Part 10 is strategic. When you know the government is required to survey the market, you can position your company to be found during that survey. Responding to Sources Sought notices, attending industry days, and ensuring your SAM.gov registration is current all increase your visibility during the agency's market research phase.
When Is It Required?
- • Before developing new requirements
- • Before soliciting offers for acquisitions over the SAT ($250K)
- • Before awarding a task or delivery order over $7.5M under a GWAC/IDIQ
- • On an ongoing basis for existing contracts to identify new solutions
What Must It Cover?
- • Availability of commercial items meeting the need
- • Customary practices (terms, warranties, financing)
- • Small business capability to perform
- • Practices of firms engaged in producing similar items
Federal Data Sources for Market Research
The federal government publishes an extraordinary amount of procurement data for free. Mastering these data sources gives you a significant competitive advantage over contractors who rely solely on opportunity notifications.
SAM.gov
The System for Award Management is the primary source for active contract opportunities, Sources Sought and RFI notices, and entity registrations. Use SAM.gov to monitor upcoming opportunities, respond to market research requests from agencies, and verify your own registration is complete and current. Pre-solicitation notices on SAM.gov give you the earliest warning of upcoming procurements.
USAspending.gov
USAspending provides a comprehensive view of federal spending by agency, recipient, geography, and category. Use it to identify which agencies spend the most in your NAICS codes, find the largest contract recipients in your market, and spot spending trends over time. The Advanced Search feature allows you to build complex queries across multiple fiscal years.
FPDS (Federal Procurement Data System)
FPDS is the authoritative system of record for federal contract actions. Every contract, modification, task order, and delivery order is recorded here with detailed data fields including contractor name, award value, contract type, NAICS code, set-aside type, competition status, and contracting office. Use FPDS to research incumbent contractors, analyze competition levels, and understand contract structures.
Agency Procurement Forecasts
Federal agencies are encouraged to publish procurement forecasts 6-18 months in advance. These forecasts list anticipated acquisitions with estimated values, timelines, NAICS codes, and set-aside designations. Many agencies publish forecasts on their Office of Small and Disadvantaged Business Utilization (OSDBU) websites. Forecasts are your earliest opportunity to identify and begin positioning for upcoming requirements.
Step-by-Step Market Research Process
Identify the Need and Define Your Target
Start by clearly defining what you sell and which agencies buy it. Map your capabilities to specific NAICS codes and Product/Service Codes (PSCs). Then narrow your focus to 3-5 target agencies whose missions align with your offerings. Cast too wide a net and your research becomes superficial. Focus on specific buying offices within agencies, not just the department level. The Department of Defense has hundreds of buying offices with vastly different procurement patterns.
Survey the Market Using Federal Data
Pull 3-5 years of historical award data from FPDS and USAspending for your target agencies and NAICS codes. Analyze: How much does the agency spend annually in your NAICS? Is spending increasing or declining? What contract types do they use (FFP, T&M, CPFF)? What percentage is set aside for small business? What is the average contract size? Are they using GWACs, GSA Schedules, or standalone contracts? This data paints a picture of how the agency buys and whether your company fits their procurement patterns.
Analyze the Competition
Identify current incumbents on contracts you want to pursue. Research their award history, contract values, and performance. Determine whether contracts are being recompeted or extended. Look at the competitive landscape: how many offerors typically compete for these awards? A contract with 15 competitors is a very different pursuit than one with 3. Assess your competitive position honestly. If the incumbent has deep customer relationships and strong performance, you need a compelling discriminator to unseat them.
Engage with the Customer
Attend industry days, pre-solicitation conferences, and small business outreach events hosted by your target agencies. These events are where agencies preview upcoming requirements and contractors ask questions. Respond to Sources Sought and RFI notices with detailed capability statements. Schedule meetings with agency OSDBU offices. All of this engagement must happen before the solicitation drops. Once the RFP is on the street, your access to the customer is restricted to the official Q&A process.
Document Your Findings
Compile your research into a structured market research report. Include: target agency profiles, spending analysis, competitive landscape assessment, contracting officer preferences, vehicle requirements, and a preliminary pricing analysis. This document becomes the foundation of your capture plan and directly informs your bid/no-bid decision. Update it quarterly as new data becomes available and as you engage with customers.
Tools and Techniques
FOIA Requests
File Freedom of Information Act requests for winning proposals (redacted), source selection documents, evaluation scores, and Independent Government Cost Estimates. These documents reveal what agencies actually value and how competitors position themselves.
GSA Schedule Pricing
GSA Schedule prices are publicly available at gsaelibrary.gsa.gov. Review competitor labor rates and product pricing to benchmark your own pricing strategy before proposals.
Subcontracting Reports (eSRS)
The Electronic Subcontracting Reporting System shows which prime contractors are meeting or missing their small business subcontracting goals. This identifies teaming opportunities with primes who need small business partners.
Agency Strategic Plans
Every federal agency publishes a strategic plan outlining priorities for the next 4 years. These plans signal where the agency will invest. Align your capabilities to the agency's stated strategic objectives.
Budget Justification Documents
Annual Congressional Budget Justification documents detail program-level spending plans. They reveal which programs are growing, shrinking, or starting new. Find them on agency websites under budget/performance sections.
Bureauify Platform
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Documentation Requirements
Effective market research produces a documented body of evidence that supports your acquisition strategy. Whether you are a contractor building a capture plan or a contracting officer justifying a procurement approach, documentation matters.
A well-documented market research report should include: a summary of the requirement, NAICS and PSC code analysis, list of potential sources identified, description of data sources consulted, analysis of commercial availability, price analysis based on historical data, competitive landscape assessment, and a recommendation on acquisition strategy (including whether commercial items are available, whether small business set-aside is appropriate, and which contract type best fits the requirement).
For acquisitions above the simplified acquisition threshold ($250,000), FAR 10.002(e) requires that market research findings be documented in the contract file. The depth of documentation should be proportional to the complexity and dollar value of the acquisition. A $500K service contract needs a different level of research than a $50M systems integration program.
Streamline Your Market Research with Bureauify
Search across SAM.gov, FPDS, USAspending, and Grants.gov data in one platform. Analyze agency spending, identify competitors, track recompetes, and make smarter bid/no-bid decisions backed by real federal data.