If you read any capture-consulting newsletter long enough you will eventually be told that your NAICS code list is too short and that you should expand it. That advice has been wrong for at least the last decade, the data has been clear about it for at least five years, and the consulting industry persists in giving it anyway because they are paid by the engagement, not by your win rate.

We have spent the better part of three months running the underlying obligations data against agency strategic plans and the FY26 President's Budget Request. The result is less a story than a pattern — and the pattern is not what the trade press has been describing.

Concentration outperforms coverage by every metric that matters

Win-rate, average award size, recompete win-rate, and time-to-award all correlate negatively with NAICS code count above six. The mechanism is simple: agencies buy from vendors who look like specialists. A long NAICS list reads, in a CO's source-selection notebook, as a tell that you do not know what you are.

"Every quarter a consultant tells me to add more NAICS codes. Every quarter we ignore them. Every quarter we win."

What that means for an operator at $5M to $50M in annual federal revenue is unambiguous: the surface area you can reasonably cover is shrinking, and the cost of being wrong about which vehicles to chase has roughly doubled since FY23.

We will keep tracking this through the end of the fiscal year. If the pattern holds through Q4, the implications for the FY27 budget cycle are larger than anything we have written about in the past twelve months.