Outside of pursuing federal government contracts, most companies never deal with NAICS codes. However, becoming familiar with them can be useful – and it helps membership organizations like a statewide manufacturing alliance, industry association or trade group help its companies to thrive.
A NAICS code is a designation the federal government uses to describe what sort of business services or products a company offers. The acronym NAICS stands for North American Industry Classification System.
While every company gets labelled officially with only one NAICS code, according to its primary service or product, a single company could have dozens of additional NAICS Codes associated with it.
Business consultants with the commerce department of a state government can also help a company learn of new opportunities and grow if they know its correct NAICS codes.
These codes are 6 digits long, and each digit has a distinct meaning:
For the most part, knowing what their Sectors are (the first 2 digits) and a handful of the full 6-digit codes are all most companies will ever need to know.
A company that has a profile on the Sustainment Technologies platform most likely will be associated with Sectors 31-33 “Manufacturing.” Within these Sectors, there are only a handful of subsectors that likely apply to anyone involved in the manufacturing ecosystem:
This includes almost everything a machine shop would do, such as:
This subsector gets into the meat of what many manufacturers that specialize in specific equipment do. It includes:
Like Subsector 333, the 336 subsector is very common among companies pursuing Department of Defense (DoD) contracts. It includes:
There are two primary reasons the government requires a company to identify with a NAICS code:
Headcount determines whether or not a company is considered small in the manufacturing industry. However, each NAICS code has its own threshold level of headcount above which a company is no longer considered a small business.
A major benefit of using NAICS codes is that a company can elect to have more than one product or line of business associated with it. While every company has only one “primary” NAICS code, there is no limit to how many “secondary” NAICS codes and product or service descriptions a company may choose to identify itself with.
Once a machine shop’s management develops an understanding of the many types of NAICS classifications available, it may decide to pursue aircraft related work as well as to manufacture trailers, for example. This flexibility is appreciated by federal government contractors, even though the volume of different classifications can be daunting at first.
If you need to locate domestic manufacturers, Sustainment can make that easier to do. With our powerful, refined search tool Sustainment members can find reliable providers that we’ve already vetted for quality and reliability.
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