The federal government awarded nearly $179 billion in prime contracts to small businesses in fiscal year 2025, according to the U.S. Small Business Administration .
But “$179 billion” does not tell an HVAC contractor where to spend Monday morning.
The useful questions are narrower:
- Which agencies buy this work?
- Which offices inside those agencies matter?
- Who has already won?
- What language and classification codes does the government use?
- Which historical awards deserve a closer look?
To see what that kind of market map looks like, I analyzed three complete fiscal years of official federal award data for NAICS 238220: Plumbing, Heating, and Air-Conditioning Contractors.
The result is a market with a surprisingly clear structure: buyers are concentrated, suppliers appear fragmented, and the purchasing vocabulary is scattered across many codes.
A durable market near $1 billion per year
Using the USAspending API, I filtered contract awards to NAICS 238220 for FY2023 through FY2025.
| Fiscal year | Contract obligations |
|---|---|
| FY2023 | $1.016 billion |
| FY2024 | $1.131 billion |
| FY2025 | $1.018 billion |
| Three-year total | $3.165 billion |
The same filter returned 12,667 contract awards.
The first lesson is not that this market grew in a straight line. It did not. Obligations rose 11.3% in FY2024 and fell 10.0% in FY2025. The more useful lesson is that federal demand in this category remained close to $1 billion in each of the three years.
That is enough activity to justify serious market research—but not enough to justify chasing everything.
Two departments account for almost three-quarters of the market
The buyer side is concentrated:
| Awarding agency | Three-year obligations | Share |
|---|---|---|
| Department of Defense | $1.598 billion | 50.5% |
| Department of Veterans Affairs | $737.4 million | 23.3% |
| Department of Agriculture | $144.8 million | 4.6% |
| Department of Transportation | $106.2 million | 3.4% |
| General Services Administration | $102.3 million | 3.2% |
DoD and VA together account for 73.8% of obligations. The five largest agencies account for 84.9%.
For a small contractor, “the federal government” is therefore too broad to be a useful target customer. A more practical first-pass account list is:
- Department of Veterans Affairs
- Department of the Navy
- Department of the Army
- Department of the Air Force
- Agricultural Research Service
- Federal Aviation Administration
- GSA Public Buildings Service
That list immediately suggests different operating environments: hospitals, bases, research facilities, airports, and federal office buildings. Each has different buyers, incumbent relationships, facility requirements, and acquisition patterns.
The market becomes more understandable when you stop treating the federal government as one customer.
The supplier field looks much less concentrated
The ten largest recipient rows in the same USAspending result accounted for 13.5% of total obligations. The largest individual recipient row accounted for only about 1.7%.
That does not prove the market is perfectly competitive. Recipient naming, corporate parents, joint ventures, and entity grouping complicate concentration analysis. But it does support a useful directional conclusion: the visible supplier field is much more fragmented than the buyer side.
When a small number of buyers purchase from a wide field of vendors, a contractor’s advantage is not “monitor every opportunity.” It is knowing which buyer environments match its capabilities, which vendors are established there, and how the work is described.
One NAICS code does not equal one purchasing vocabulary
NAICS 238220 is a useful market boundary. It is not a complete search strategy.
The largest Product and Service Code categories inside the filtered market were:
| PSC | What it describes | Obligations |
|---|---|---|
| J041 | HVAC and air-circulating equipment maintenance/repair | $426.6 million |
| Z2JZ | Repair or alteration of miscellaneous buildings | $390.6 million |
| J045 | Plumbing and heating equipment maintenance/repair | $257.0 million |
| Z1DA | Maintenance of hospitals and infirmaries | $205.0 million |
| Z2AA | Repair or alteration of office buildings | $161.5 million |
Those five categories account for only 45.5% of the three-year total. The rest is distributed across hospital alterations, administrative facilities, office maintenance, equipment installation, heating and cooling plants, and other facility categories.
If a contractor watches only J041, it may find relevant work—but it will not see the whole market captured by the NAICS category.
This is the vocabulary problem in federal contracting. A business may describe itself as:
Commercial HVAC preventive maintenance, chiller repair, building controls, and emergency service.
The government may buy related work as equipment maintenance, hospital maintenance, office-building alteration, mechanical-system repair, plant maintenance, or installation. The contractor and the buyer can be talking about the same capability with very different words.
What an HVAC contractor should do with this information
1. Pick two buyer environments
Do not begin with all of DoD and all of VA. Choose two environments where your past performance is credible—for example, medical facilities and office buildings, or Navy installations and heating plants.
2. Study the subagencies and incumbents
Identify who buys, who performs the work now, and which award descriptions resemble your actual capability.
3. Build a vocabulary set
Track capability phrases and relevant NAICS and PSC codes together. Codes are clues, not a substitute for reading the underlying award evidence.
4. Investigate historical periods of performance
An ending period of performance is a research signal, not a promise of a recompete. Verify the award, modifications, current acquisition strategy, and any active notice in official systems.
5. Use SAM.gov for current opportunities
SAM.gov is the free, official source for federal contract opportunities. Historical market research should make your SAM.gov monitoring narrower and more intentional—not replace it.
Why I built FedFathom
Public federal data contains the answers, but turning millions of award records into a usable market map is still hard.
I built FedFathom to start with the language a contractor already knows and organize the strongest historical signals around buyers, vendors, codes, procurement language, representative awards, and possible recompete timing.
It is designed for the step before opportunity pursuit: deciding where your capabilities fit and where deeper research is worth the time. You can create an account and run five free searches. A useful first prompt for this market is:
I maintain and repair commercial HVAC systems for hospitals and large facilities, including chillers, air handlers, preventive maintenance, emergency service, and building controls.
FedFathom is a research aid, not an official government source or a guarantee of future awards. Verify material information through the linked official records.
Methodology and limitations
This analysis was performed on July 24, 2026 using official USAspending API endpoints. Filters covered October 1, 2022 through September 30, 2025; contract award type codes A, B, C, and D; and required NAICS code 238220. Dollar figures are transaction obligations. The award count is returned at the award level, so it is not the same grain as transaction-level dollar totals.
Obligations can include positive and negative modifications. They are not contract ceilings, revenue, profit, or a forecast. USAspending data may be revised. The NAICS category includes plumbing and heating work in addition to air conditioning. Recipient rows are not a perfect proxy for independent economic competitors. Historical awards do not prove that a future solicitation or recompete will occur.