The North American Industry Classification System (NAICS) is used by the United States, Canada, and Mexico to classify businesses by industry. Each business is classified into a six-digit NAICS code number based on the majority of activity at the business. The Census Bureau tabulates the data into summary totals at the two-digit down to six-digit NAICS levels.
Know your NAICS code
Compete for government contracts and grants
Federal and state governments often require NAICS codes to determine if a business is eligible for government purchase contracts or grants.
TIP: The System for Award Management (SAM), where businesses register to become federal contractors, accepts multiple NAICS classification codes per establishment. If your company is interested in participating in the federal marketplace, you should select four to five NAICS codes that best reflect your primary lines of business.
Get certifications from the Small Business Administration and Department of Veterans Affairs
The Small Business Administration (SBA) requires NAICS codes from small businesses that wish to become SBA-certified and be eligible for government contracts set aside for certified small businesses.
The Department of Veterans Affairs (VA) requires NAICS codes for each veteran-owned small business wishing to become a VA-verified Veteran-Owned Small Business (VOSB) or Service-Disabled Veteran-Owned Small Business (SDVOSB). These verifications allow small businesses to be eligible for VA contracts.
Improve your business loan posture
Commercial lenders make industry comparisons to see how closely you compare to other businesses, so choosing the right codes for your application can give you a stronger chance of being approved for a loan.
TIP: Make sure the lender uses the correct NAICS code for your business. Incorrect codes can raise red flags in the underwriting process.
How the Government Uses NAICS Codes
Now that you know what data exists, it’s time to write a business plan. Don’t know where to begin? These resources can help you apply Census data to your plan.
Many federal, state, and local governments require NAICS codes from businesses for administrative, taxes, or contracting purposes.
NAICS helps group similar business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the economy. This collection contributes to data products from the Census Bureau and other federal, state, and local agencies.
Government agencies may use NAICS codes for other administrative purposes and required forms. For questions regarding other federal agencies' uses of the NAICS system, contact the specific agency.
Find my NAICS code
While some federal agencies assign NAICS codes for businesses, many other agencies require businesses to identify the right code(s) for themselves.
The NAICS code has 20 primary two-digit NAICS code classifications, often called sectors. For example, all Accommodation and Food Services businesses are under the NAICS two-digit code of 72.
The NAICS hierarchy includes 96 subcategories and 317 industry groups. You can identify subcategories by their three-digit codes, and industries by their four-digit codes. You may be wondering, “What is my NAICS code?” To properly determine your primary NAICS code(s), you must work down the classification scheme to identify the best fit for your business.
Find multiple codes
Your business may be assigned more than one NAICS code. Utilize a secondary NAICS code if your business has characteristics of another industry. If your business has more than one location, you will need to choose a NAICS code that applies to the primary activity taking place at each location.
Need help? We provide a training to help you make the right choices
Already an expert NAICS navigator? Find your code in our NAICS lookup
Can't find the perfect fit? Sometimes, there is no perfect fit for your business at the four-digit level. For each classification level there is an option that says, “Not otherwise classified.” If no other codes are applicable to your business, select this as your NAICS identification.