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NAICS NewsletterApril 3, 2008

NAICS 722310

Food Service Contractors

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 Food Service Contractors.


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 Food Service Contractors.


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 'Food Service Contractors' industry, NAICS 722310. 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 buying these services over the last four fiscal years.

Top 10 Federal Agencies by % of Total Market FY03 - FY06 for NAICS 722310

WHAT IS NAICS 722310?

Companies represented by NAICS 722310 provide food services at institutional, governmental, commercial, or industrial locations. The services are provided for the convenience of the contracting organization or the contracting organization's customers. The contracts for these services may vary by type of facility operated (e.g., cafeteria, restaurant, fast-food eating place), revenue sharing, cost structure, and/or providing personnel. These companies always provide the management staff for these contracts.

The description of NAICS 722310 is further broken out to include these additional specific topics:

  • Airline food services contractors
  • Cafeteria food services contractors (e.g., government office cafeterias, hospital cafeterias, school cafeterias)
  • Food concession contractors (e.g., convention facilities, entertainment facilities, sporting facilities)
  • Food service contractors, airline
  • Food service contractors, cafeteria
  • Food service contractors, concession operator (e.g., convention facilities, entertainment facilities, sporting facilities)
  • Industrial caterers (i.e., providing food services on a contractual arrangement (except single-event basis))

NAICS 722310 has remained the same through all versions of the NAICS - 1997, 2002, and 2007. It was previously represented by SIC 5812. The size standard for NAICS 722310 the size standard is $19.0 Million (effective October 1, 2007), which means that a company, including its affiliates, would be considered a "small business" if their average annual gross revenue does not exceed $19.0 Million for the past three years.

Total reported spending under NAICS 722310 in FY03 was $458 Million. FY04 saw a significant increase, to $846 Million. Spending for FY05 and FY06 are not as widely reported as the previous fiscal years, so those values ($502 Million for FY05 and $184 Million for FY06) do not represent total contract spending for those fiscal years. These numbers will increase as more departments and agencies report their contract spending.

WHO ISSUES THE CONTRACTS?

The Department of Defense (DoD) was the largest buyer for these services for the last four fiscal years (FY03 through FY06), with over $1.7 Billion in contract spending, comprising over 86% of the market share for NAICS 722310. This value includes all components of the Defense Department (Army, Navy, Marine Corps, Air Force, DLA, etc.), however, FY05 and FY06 contract dollars have not been as widely reported yet (at least as far as FPDS data), so that total will increase as more information is reported. The Department of Homeland Security (DHS) was a distant second, with $87 Million. The Department of Justice (DOJ), General Services Administration (GSA), and Department of State rounded out the top five.

Top 10 Federal Agencies by % of Total Market FY03 - FY06 for NAICS 722310

WHO WINS THE CONTRACTS?

According to the Central Contractor Registry (CCR), there are 1,281 companies registered under NAICS 722310 (source: active registrants, www.ccr.gov as of 03/21/2008). Of this number, 908 qualify as small businesses.

The two charts below identify the top 10 Companies, by market share, for the period of FY03 through FY06. 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

Sodexho Management Inc. holds the top spot on the unrestricted competition list, with over $274 Million in total contract dollars for FY03 through FY06 - over 14% of the market share. A large portion of this market share is from the two United States Marine Corps contracts held by Sodexho, which cover food service at all Marine garrison mess halls in the continental U.S. (CONUS). The second and third ranked companies, Goodwill Industries of Southeast and Tamimi Global Co. Inc., both have total contract dollars exceeding $100 Million for the FY03 through FY06 period. The remaining firms in the top ten all have reported contract spending at over or almost $50 Million (the ninth and tenth contractors - Lakeview Center Inc., and South Carolina Commission for the Blind both have $49 Million). Another 20 firms all have reported spending over $10 Million.

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 722310 Contractors by % of Total Market for FY03 - FY06 - Unrestricted

The combined contract spending for contracts awarded under "restricted competition" totaled over $239 Million for FY03 through FY06. KCA Corporation (sixth on the unrestricted/any competition list above) takes top honors for contracts with reported acquisition strategies associated with small businesses. Their 15% of the market share equates to contract dollars exceeding $37 Million. The next five firms on the list all have contract spending totals of at least $10 Million each for restricted acquisition strategy contracts during this period. The remaining firms on this top ten list all have reported contract dollars of at least $5 Million.

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 722310 Contractors by % of Total Market for FY03 - FY06 - RESTRICTED Competition

HOW ARE THESE CONTRACTS PROCURED?

Over 50% of the contract dollars spend during the FY03 through FY06 timeframe were awarded using full and open competition. This represented over $1.07 Billion for NAICS 722310. Over 34% of contracts during this period did not report their acquisition strategy. These contracts could include those awarded using full and open competition, small business set-aside, or any manner of restriction. This accounted for over $680 Million in contract dollars. Contracts set aside for small businesses totaled $100 Million for this period. Almost 6% of the market share was held by 8(a) set-aside contracts, with $81 Million awarded on a competitive basis, and another $33 Million through sole source contracts.

Acquisition Breakout under NAICS 722310 - FY03 through FY06

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 of $1.69 Billion and contracts for locations outside the United States total over $293 Million. The map below illustrates the distribution of locations within the United States. For example, there are 10 states that are shaded dark purple. This means that these states have reported contract spending between $48 Million and $262 Million.

The state with the highest total of reported contract spending is California, with over $261 Million. The State of Illinois has the second largest reported amount, with over $187 Million. Georgia, Texas, and North Carolina also have reported contract dollars for the FY03 through FY06 period of over $100 Million.

Contract Place of Performance under NAICS 722310 FY03-FY06
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