Small and medium-sized software companies account for 97.8% of public projects under KRW 2 billion

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Over 10 years, 18.8 → 69.4% of ‘increased’ performance
The share of orders received from large companies reaches 30%
Impact of the exception recognition project, the call for tenders project, etc.
Versus

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Small and medium-sized software companies (SW) carried out more than 90% of public software projects worth less than KRW 2 billion. It is interpreted that after the 10th year of implementation of the SW Industry Promotion Law, which restricts the participation of large software companies (SW) in public SW projects that exceed 90% in cost and number of projects, has established itself on the market.

After analyzing the Korea Software Industry Association’s report on 1549 cases of software development and construction projects (January 1 – December 31, 2021) disclosed on the public procurement department’s open portal, the number of projects carried out by small and medium-sized software companies that are worth less than KRW 2 billion was 97.8%.

97.2% of projects under 100 million KRW, 99.4% of projects between 100 and 500 million KRW, 97.7% of projects between 500 and 1 billion KRW and 96.5% of projects between 1 to 2 billion KRW were made by small and medium-sized software. companies when breaking down projects by cost. Considering all projects, including projects worth more than KRW 2 billion, the number of projects completed by small and medium software companies accounts for 49.4%. Medium-sized companies represent 21.8% of the remaining projects and large companies 28.8%.

This means that half of the public software projects ordered last year through the Public Procurement Service were carried out by small and medium enterprises, and the rest were carried out by medium and large enterprises on the basis of the cost of projects. In terms of the number of projects, small and medium software companies completed 92.8% of the total projects. Medium and large companies represent 4.1% and 2.9% respectively. Small and medium software companies account for 97.9% of projects when considering projects below KRW 2 billion.

Share of software development and construction projects by size based on the open portal of the public procurement service of 2021 (based on the amount, %)

*Excluding other not-for-profit companies

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By staff reporter Hocheon An ([email protected])

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