What is a NAICS code?

A NAICS code is a number from two to six digits that classifies a business by what it mainly does. NAICS stands for the North American Industry Classification System, the standard the United States, Canada and Mexico use to group businesses by industry. A full service restaurant is 722511. A long haul trucking company is 484121. A management consultant is 541611. Every agency, lender and insurer that needs to sort businesses by industry uses these numbers.

If you want your code right now, describe the business in the NAICS code calculator and it returns the code.

What NAICS means

The system was introduced in 1997 to replace the older Standard Industrial Classification (SIC) system. It is maintained in the United States by the Economic Classification Policy Committee under the Office of Management and Budget, and the Census Bureau publishes the official manual. The system is revised every five years. The current edition is NAICS 2022.

The key idea is that NAICS classifies by production process. Businesses that make or deliver things the same way share a code. That is why a bakery that sells from its own storefront sits in manufacturing (311811, retail bakeries) while a grocery that resells bread sits in retail.

People search for "NAICS number", "NAICS code meaning" and "NAICS ID". They all mean the same thing: the six digit industry code that describes your primary activity.

How the six digit structure works

Each digit adds detail. The first two digits are the sector, and every digit after that narrows the industry.

The first five digits are shared across the United States, Canada and Mexico. The sixth digit is set by each country, which is why it is called the national industry level. A six digit code ending in zero, such as 238210, usually means the United States did not split that five digit industry any further.

The worked example shows how close neighbors sit. A full service restaurant with table service is 722511. A counter service restaurant where you order and pay first is 722513. A cafeteria or buffet is 722514. A snack bar or coffee shop is 722515. Same industry group, different six digit codes, and lenders can treat them differently.

Who assigns a NAICS code

No one assigns it. Your NAICS code is self assigned. The Census Bureau says it does not assign NAICS codes to businesses. You pick the code that best describes the activity that produces most of your revenue, and you use it consistently on your forms.

That also means different organizations can list different codes for the same business. Your tax return might show one code, your SAM.gov registration another, and a data provider like Dun and Bradstreet a third that it inferred on its own. The fix is to choose one correct primary code and update the places that show something else. Our guide on how to change your NAICS code walks through each one.

Where the NAICS code is used

The code shows up wherever a business has to say what it does.

For financing, the code matters more than most owners expect. A lender's appetite list is usually written in NAICS codes. Our page on NAICS codes and business loans covers how lenders read your code and which industries face restrictions.

The 20 NAICS sectors

NAICS 2022 has 20 sectors. Three of them span more than one two digit number because they were too large for a single prefix.

Below the sectors, NAICS 2022 has 96 subsectors, 308 industry groups, 689 NAICS industries and 1,012 United States national industries, according to the Census Bureau. The full breakdown is in our NAICS codes list.

NAICS 2022 is the current version

The 2022 revision was one of the bigger ones. The retail sector was restructured so that online sellers are classified by what they sell instead of sitting in a separate nonstore category. The old 454110 code for electronic shopping no longer exists. The information sector was also reorganized, with publishing and broadcasting regrouped into new subsectors 513 and 516.

If your code came from an older form or a website that has not been updated, check that it still exists in NAICS 2022. The IRS business activity code list on Schedule C already follows the 2022 retail changes, and it now tells nonstore retailers to use the code for the main product they sell.

NAICS code versus other business numbers

Owners often mix up the numbers on their paperwork. Here is how they differ.

• EIN: your federal tax ID, unique to your business.
• UEI: the unique entity ID that SAM.gov assigns to each registered entity.
• DUNS: the Dun and Bradstreet number, now used mainly for commercial credit files.
• SIC code: the four digit predecessor to NAICS, still used by the SEC and some lenders. See NAICS vs SIC codes.
• NAICS code: a shared industry classification. It describes the type of business, not the business itself.

Getting your code right

Pick the code for the activity that brings in the most revenue, not the one that sounds most impressive. A contractor who mostly does electrical work and occasionally pulls permits for small remodels is 238210, electrical contractors. A software company that bills mainly for custom builds is 541511. If you run two distinct lines of business, the larger one by revenue is your primary code. Our guide on how to find your NAICS code covers the edge cases.

The right code pays off when you apply for financing. Start an application and the AI matches the deal to lenders that fund your code, so a correct code puts you in front of the lenders most likely to say yes.