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NAICS stands for North American Industry Classification System
This code is used for several purposes by Federal statistical agencies in classifying business establishments for analyzing, collecting, and publishing statistical data related to the U.S. business economy.
It is also used by lenders for risk purposes of a business.
NAICS Coding system is structured to classify all economic activity into 20 industry sectors. Five sectors are mainly good producing sectors and are entirely service providing sectors.
This code is 6 digits long. These codes are updated approximately every 5 years.
Let’s look at these codes when it comes to business credit and business loans.
Go to www.naics.com to choose the best code that fits your business. As you are reviewing these codes. take note of the high- risk and the low-risk codes. For more on high risk and low risk codes refer to Let’s take a look at high-risk and low-risk codes.
For the best chances of being approved for credit/loans, you will want to use these codes on:
- Tax Returns: Tell your accountant/tax preparer the exact name and code(s)
- Business Credit Reporting Agencies: Take the time to pull your Business Credit and see what NAICS codes are being reported. If they are not the correct one(s) go update them with all 3 credit bureaus.
- Banks: when opening an account at the bank make sure you give them the correct industry you are in. Also, when applying for credit/loans make sure you use the correct name (description) and code (exact verbiage).
PS: You can go to www.exclusiveprocessingandconsulting.com to receive Free business credit tips periodically and to for a FREE consultation.
About the Author
Kimberly Lewis is currently the CEO of EPC Solutions LLC. She specializes in helping business owners establish excellent business credit scores and then leveraging those scores to access credit and cash for their businesses. For more information on business credit scores, business credit and business loans visit https://epc-solutions.net.