Get Funded

Business Basics

SIC and NAICS Codes: What They Mean for Your Business

SIC and NAICS codes classify businesses by the kind of work they do. NAICS is the current system used by the U.S. government. SIC is the older system, still seen on some forms. You will likely need your code for registrations, contracts, insurance and financing applications.

Apply Now

One application · Matched across our 100+ funder network · Same-day funding on approved files

What the codes are

A NAICS code is a six-digit number that identifies a business's primary industry. SIC is an older four-digit system that NAICS largely replaced.

NAICS stands for North American Industry Classification System. It was developed with Canada and Mexico and is used by federal agencies, including the Census Bureau, to collect and compare data by industry. The first digits identify the broad sector, and later digits narrow it down to a specific type of business.

SIC stands for Standard Industrial Classification. It came first and was replaced in the federal statistical system, but you still see it on some forms, databases and credit reports. If a form asks for either, look up the code you need in the official lists.

Why you may be asked for one

Codes appear on government registrations, contract bids, insurance applications, business credit files and many financing applications.

Common places the code shows up:

  • Federal contracting. The SBA uses NAICS codes to set size standards, which determine whether a business counts as small for a particular contract. See how the SBA defines a small business.
  • Insurance. Underwriters use the industry to price risk.
  • Business credit and registrations. Dun & Bradstreet and other databases classify companies by code. See how a DUNS number helps a business.
  • Financing. Funders use your industry to understand your cash flow and to apply any restrictions.

How to find the right code

Use the official NAICS search tool from the Census Bureau, search by keywords describing your main activity, and choose the code that matches where most revenue comes from.

Follow these steps:

  1. Write down what the business sells and how it earns money.
  2. Search the Census Bureau's NAICS lookup using plain keywords.
  3. Read the descriptions, including the notes about what is included and excluded.
  4. Choose the six-digit code that best fits your main source of revenue.
  5. Record it and use it consistently.

If you cannot decide between two codes, pick the one that earns most of your revenue. The classification is about your primary activity, not every service you offer.

Common mistakes

The most common errors are choosing a code that sounds nicer, listing different codes in different places, and using an outdated code after the business changes.

Avoid these problems:

  • Picking a code for the wrong reason. Some owners choose a code that looks lower risk. That can cause trouble with insurance and with funders if their review finds a mismatch.
  • Inconsistency. Registrations, tax filings and applications should line up where possible.
  • Ignoring changes. A shop that began as retail and now makes most of its money from wholesale may need an updated code.

Accuracy matters in lending. A restaurant that lists itself as a catering company, or a trucking firm that lists itself as logistics consulting, may be flagged. Be accurate. Our guide to what business operations means can help you describe what you do.

How codes relate to business entity and taxes

Your code describes your industry. It is separate from your legal structure and does not change your tax status by itself.

A NAICS code does not decide whether you are an LLC, a corporation or a sole proprietor. See what a business entity means. The IRS asks for a business activity code on some returns, and it uses a similar numbering scheme. Use the code that matches the instructions for the form you are filing, and ask your accountant when in doubt.

What your code means when you apply for funding

Funders use industry to judge cash flow patterns and any restrictions. Describing your business accurately helps match you to funders that work with it.

Industries behave differently. A restaurant has daily deposits and thin margins. A contractor has lumpy income tied to jobs. A medical practice has insurance payment delays. Funders consider these patterns when reviewing a file, and some restrict certain industries, such as long-haul trucking and residential remodeling.

ROI Funder matches each file to the funders that fit it and shows total cost, payback period and monthly-equivalent payments before you sign. It considers 500+ FICO, 6+ months in business and $20,000+ monthly revenue. If you plan to apply, list your industry honestly, then compare working capital or a line of credit. Our industry pages show how funding looks in different trades.

Frequently asked questions

Is NAICS the same as SIC?

No. NAICS is the current six-digit system used by U.S. agencies. SIC is the older four-digit system that it largely replaced.

How do I find my NAICS code?

Use the Census Bureau's NAICS search tool with keywords for your main activity, then pick the code that best matches your largest source of revenue.

Can I have more than one code?

You may list secondary codes on some forms, but you usually choose one primary code based on where most revenue comes from.

Does my code affect loan approval?

It can, because funders consider industry patterns and restrictions. Choose the code that honestly reflects your business.