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NAICS NewsletterJanuary 21, 2010

NAICS 541330

Engineering Services

Government Contract and Procurement Analysis Report

Report Summary

This report, offered by epipeline, contains a brief analysis of the Federal government's procurement practices with regards to purchasing the services of Engineering Services.


You will find information on the top federal government agencies that purchase these services, as well as their procurement strategy (i.e. full and open competition, set-asides and more). Finally, there is a review of the top companies that are awarded federal government contracts for Engineering Services.


To get a more comprehensive analysis and learn more about how epipeline can help you identify current and future bid opportunities, register for a live Demo.

This report takes an in-depth look at the 'Engineering Services' industry, NAICS 541330. To understand the future, one must study the past. epipeline's Contract History Plus* provides you with a broad context and several perspectives that enables you to develop the best positioning and strategy for your company to more effectively compete for government contracts. The following graph illustrates one such perspective: the top Government departments/agencies buying these services over the last four fiscal years.

Top 10 Federal Agencies by % of Total Market FY03 through FY06 for NAICS 541330

WHAT IS NAICS 541330?

NAICS 541330 represents the Engineering Services industry. It is used when the requirements of the contract applies physical laws and principles of engineering in the design, development, and utilization of machines, materials, instruments, structures, processes, and systems. It may include the application of these principles for provision of advice, preparation of feasibility studies, preparation of preliminary and final plans and designs, provision of technical services during the construction or installation phase, inspection and evaluation of engineering projects, and related services.

The description of NAICS 541330 is further broken out to include these additional specific topics:

  • Acoustical engineering consulting services
  • Acoustical system engineering design services
  • Boat engineering design services
  • Chemical engineering services
  • Civil engineering services
  • Combustion engineering consulting services
  • Construction engineering services
  • Consulting engineers' offices
  • Consulting engineers' private practices
  • Electrical engineering services
  • Engineering consulting services
  • Engineering design services
  • Engineering services
  • Engineers' offices
  • Engineers' private practices
  • Environmental engineering services
  • Erosion control engineering services
  • Geological engineering services
  • Geophysical engineering services
  • Heating engineering consulting services
  • Industrial engineering services
  • Logging engineering services
  • Marine engineering services
  • Mechanical engineering services
  • Mining engineering services
  • Petroleum engineering services
  • Traffic engineering consulting services

The size standard associated with NAICS 541330 is $4.5 Million (effective August 22, 2008), which means that a company, including its affiliates, would be considered a "small business" if their average annual gross receipts does not exceed $4.5 Million for the past three years. If a company has not been in business for three years, the average weekly revenue for the number of weeks the company has been in business is multiplied by 52 to determine the average annual receipts. However, there are three exceptions to this sizing:

  • 1. If the project is for Military and Aerospace Equipment and Military Weapons, then the size standard is $27.0 Million;
  • 2. If the Contracts and Subcontracts for Engineering Services are Awarded Under the National Energy Policy Act of 1992, then the size standard is $27.0 Million; and
  • 3. If the project is for Marine Engineering and Naval Architecture, then the size standard is $18.5 Million.

This code is unique in that it corresponds to two different industries. Within epipeline, these industries are represented as "Information Technology (IT)," and "Architecture, Engineering, Construction, and Environmental (AEC)." While some companies perform services for both industries under NAICS 541330, many more limit their business to just one sector or another. These different sectors can be identified within government procurement under NAICS 541330 by Products and Services Codes (PSC). Depending upon your source, this might also be called a Procurement Classification Code, Procurement Service Classification, or even Federal Supply Classification (FSC) Code.

The top ten PSC codes used under NAICS 541330 are illustrated in the chart below. The number one code, "R - Professional, Administrative, and Management Support," is a very generic topic, which includes most of the Information Technology-related contracts. This code represents about 38% of the market share for FY05 through FY09, which equates to over $52 Billion in contract spending. "A - Research and Development" was second, with over $33 Billion. The third- and fifth-ranked codes, " J - Maintenance, Repair, And Rebuilding Of Equipment" and "C-Architecture & Engineering Construction" are projects better reflected in the AEC industry. Together, these codes represent over $21 Billion in contract spending under NAICS 541330 and over 15% of the market share.

Top 10 PSC Codes by % of Total Market FY05 through FY09 for NAICS 541330

Total reported spending under NAICS 541330 for the period of Fiscal Year 2005 (FY05) through the Fiscal Year 2009 (FY09) was over $138.0 Billion. FY09 reported spending of $18.4 Billion for services under NAICS 541330. The chart below illustrates the reported** spending by year for FY05 through FY09.

Reported Contract Spending FY05 through FY09 for NAICS 541330

WHO ISSUES THE CONTRACTS?

The United States Navy was the largest buyer for these services for the last five fiscal years (FY05 through FY09), with over $51.7 Billion in contract spending, comprising over 37% of the market share for NAICS 541330. The United States Army represented about one-third of reported spending under this code, with 30% of the market share, which equated to $42.5 Billion. All but SOCOM and DOE in the top ten reported spending above one billion for this same period.

Top 10 Federal Agencies by % of Total Market FY05 through FY09 for NAICS 541330

WHO WINS THE CONTRACTS?

According to the Central Contractor Registry (CCR), there are 35,183 companies registered under NAICS 541330 (source: active registrants, www.ccr.gov as of 01/12/2010). Of this number, 27,206 qualify as small businesses, which includes the following breakout by socioeconomic categories (some companies may qualify under more than one category):

  • 2,167 SBA Certified 8(a) contractors;
  • 892 SBA Certified HUBZone contractors; and
  • 2,834 Service Disabled Veteran Owned Small Businesses (SDVOSB).

The two charts below identify the top 10 Companies, by market share, for the period of FY05 through FY09. The first chart represents the top 10 companies that were awarded their contracts under ANY type of competition, whether it was full and open, small business set-aside, sole-sourced, etc. This list primarily consists of large businesses. The second chart, however, lists the top 10 companies that won their contracts under RESTRICTED competition. Specifically, epipeline limited this to those contracts awarded under the acquisition strategies listed below. The contract dollars represented on this second chart may not include all contract dollars for the individual contractor.

  • 8(a) Competed
  • 8(a) Small Disadvantaged (SDB) set-aside
  • 8(a) sole-source
  • SDB set-aside
  • SDB, 8(a) with HUBZone
  • Combination HUBZone and 8(a)
  • HUBZone set-aside
  • HUBZone sole-source
  • Service Disabled Veteran-Owned Small Business (SDVOSB) set-aside
  • SDVOSB sole-source
  • Emerging Small Business set-aside
  • Very Small Business set-aside
  • Reserved for Small Businesses ($2501 to $100,000)
  • Total Small Business set-aside

The Boeing Company holds the top spot on the unrestricted competition list (any/all acquisition strategies), with over $14.74 Billion in total contract dollars for FY05 through FY09 - or 13.81% of the market share. Lockheed Martin Corporation is second with their 8.21% of the market share ($8.76 Billion). Northrop Grumman Space And Mission Systems reported also reported spending above $5 Billion, with their $5.70 Billion over the last five fiscal years. All of the firms in the top ten, as well as fourteen additional companies reported contract spending for the FY05-FY09 period of over $1 Billion.

PLEASE NOTE: as this is a listing by Company name, rather than PARENT company, some companies may have more than one ranking, which may not reflected in the chart below.

Top 10 NAICS 541330 Contractors by % of Total Market for FY05 through FY09 - Unrestricted

The combined contract spending for contracts awarded under "restricted competition," as outlined above, totaled over $4.71 Billion for FY04 through FY09. Fuentez Systems Concepts Inc. (owned by Stanley Associates) is the only one of the firms on this restricted list to crack the $200 Million mark (about $223M) for spending during this period. This spending primarily is for contract # N65236-03-D-7845, for " essential production and integration services to various mission critical C5ISR Programs under the U.S. Navy and USMC." BioEngineering Arcadis LLC was a distant second, reporting almost $140 Million for the same period. Chenega Federal Systems LLC, SGT Inc., and Digital System Resources all reported spending above $100 Million and the remaining firms in the top ten all reported spending above $75 Million. Note, not all companies on this list are actually small businesses (such as SAIC in the ninth spot). This can be caused by either an error in reporting, such as the acquisition strategy was listed as small business set-aside, when it really was unrestricted, or perhaps if the large business acquired a small business that was the original awardee for the high-dollar contract.

PLEASE NOTE: as this is a listing by Company name, rather than PARENT company, some companies may have more than one ranking, which may not reflected in the chart below.

Top 10 NAICS 541330 Contractors by % of Total Market for FY05 through FY09 - RESTRICTED Competition

WHERE ARE THESE CONTRACTS PERFORMED?

These contracts are being performed across the continental United States and abroad. The 50 states plus Washington, DC have reported spending for the FY05 through FY09 period of $133.9 Billion and contracts for locations outside the United States (or unlisted) totaled approximately $4.2 Billion.

The state with the highest total of reported contract spending is Virginia, with $22.0 Billion. Virginia is part of the Washington, DC metropolitan area, which also includes Maryland ($11.7B ranked 4th) and Washington, DC ($5.5B ranked 9th). Their combined contract values comprise 28% of the market share for NAICS 541330 during the period of FY04 through FY09. This geographical area is home to many federal contractors, who are sometimes called "Beltway Bandits" due to their proximity to the headquarters of the Federal Government.

California and Missouri reported spending above $10 Billion for this period, and all states (including Washington, DC) in the top ten, along with 13 states outside the top ten, reporting spending above $1.0 Billion.

Acquisition Breakout Sole Source under NAICS 541330 for FY05 through FY09
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