August 16 Procurement Market Report: Daegyeong Forest Development, Geumgang GI, Kyobo Life Plan See Dramatic Expansion into Public Procurement

From forestry SMEs like Daegyeong Forest Development and Forest Resource Development Co., Ltd. to spatial information specialist Geumgang Geographic Information and insurer Kyobo Life Plan Life Insurance, companies in sectors rarely seen in the market have recently lined up to make their mark. A comprehensive review of procurement data reveals that most companies entered the public market through a single procurement contract, signaling a shift from the past market landscape where orders were concentrated on specific large firms. The same data confirms that AI and cloud-based service bids increased by around 30% year-over-year.

Lower Barriers to Entry Broaden Industry Map

The most distinct pattern in the data is the expansion of the industry spectrum. It encompasses virtually all-encompassing sectors: environmental management firm Daehun Environment (Eco Management Korea), architectural design firms Hanin Architects & Engineers and Hanbit Engineering & Architects, tourism firm Namdo Tourist, elevator maintenance firm Samjeong Elevator, and e-commerce firm My Shop On Shop. The convention where construction and civil engineering handled the majority of public orders is crumbling, with services and technology emerging as the new axis of procurement demand.

The background is clear. KONEPS, the electronic procurement system operated by the Public Procurement Service, has significantly simplified procedures for participating in goods and service bids, and the public market, with an annual transaction scale exceeding 100 trillion won, has become a space sufficiently open for SMEs seeking stable sales channels. The fact that small and mid-sized construction and technology firms like Neulpume ENC, Ace Stone Engineering, and Taeseong have been racking up procurement records is also interpreted as a result of lowered entry barriers.

Shift in Center of Gravity Evident in AI and Cloud Bid Growth

The roughly 30% year-on-year increase in AI and cloud service bids signals that the center of gravity for public demand has shifted from civil engineering and construction to data-based services.

The core lies in the expansion of digital-based orders. As public institutions allocate budgets for data administration, smart safety management, and spatial information construction, related bids have occurred simultaneously across the board. Actual data includes companies handling spatial information like Geumgang Geographic Information and safety technology firms like Innovation Safety Technology, confirming the participation of IT companies such as Jinwoo ATS, Interz, and Vable. The common denominator for these firms is their ability to execute contracts in the form of services that collect and analyze data via cloud infrastructure.

The strong performance in the forestry sector follows the same trend. As forest welfare expansion and carbon neutrality policies align, orders for national forest management and forest resource surveys have increased. Furthermore, digital technologies like satellite imaging and drone surveying are rapidly permeating practical operations in this field. Consequently, even sectors classified as traditional industries are finding it difficult to execute public projects without digital tools.

Changing Market Landscape and Corporate Performance Impact

The expansion of the company base foreshadows two changes in the market. For SMEs, procurement serves as a stable cash flow source that mitigates the volatility of private sector orders. The fact that even sectors centered on private enterprise, such as Kyobo Life Plan, are considering public contracts is proof that public demand has established itself as a growth market. However, as the number of participants increases, price competition inevitably intensifies. This implies that expanding order volume will be difficult without technical prowess and a track record of implementation.

Outlook: Digital Transformation Budgets Drive the Market

The trend is expected to continue in the second half of the year. The public sector’s adoption of AI and migration to cloud services is on a structural upward trend, so the scale of related bids is likely to maintain an expansionary phase for the time being. Furthermore, entry into fields with clear policy demand, such as forestry, environment, and facility maintenance, is highly likely to increase. The next scene in the procurement market indicated by this data is one where companies that differentiate themselves through expertise—not merely participation—will gain the upper hand.