How to Choose the Correct NAICS or SIC Code

Picking a NAICS or SIC code starts with a simple question: what does the business mainly do? For many straightforward businesses, that answer gets you most of the way there. Say what the business sells, match it to the closest code description, and check that the code fits the real operation.

Updated June 2026 · Reviewed by the SICCODE.com Industry Classification Review Team, specialists in classification, governance, and business research.

The short answer

Find the business's main activity, meaning the thing that brings in the most money or best describes what customers buy from the business. Then choose the NAICS or SIC code that matches that activity most closely. If the business has different operations in different locations, each location may need its own code.

Guidance from SICCODE.com

SICCODE.com has helped businesses, lenders, marketers, researchers, and compliance teams interpret NAICS and SIC classifications since 1998. This guidance is based on official code structures, source descriptions, establishment-level review principles, and professional classification review experience.

Why the right code matters

A NAICS or SIC code can affect how a business is found, compared, reviewed, or approved. These codes are used in business lists, lender comparisons, insurance review, vendor setup, government forms, market research, customer screening, and compliance workflows.

For a basic directory listing, a close match may be enough. For lending, insurance, regulated reporting, procurement, or customer risk review, the code should be chosen more carefully and documented.

Choose your code in 5 steps

A simple path from "I'm not sure" to a code you can explain.

  1. Say what the business does in one sentence

    Describe it the way you would explain it to a customer. Focus on what people actually buy or receive. Skip back-office work like HR, accounting, or management unless that is the service being sold.

  2. Pin down the main activity

    If a business does more than one thing, start with the activity that brings in the most revenue. If you do not have revenue detail, look at what the business spends most of its time doing and what customers mainly know it for.

  3. Match it to the closest code

    Look for the code description that fits the business activity best. When the business is clear, choose a specific code over a vague "other" or "all other" category.

  4. Check the code against the real business

    Review the website, services, product list, locations, and customer-facing language. The code should match how the business actually operates, not just one word in its name.

  5. Write down why you picked it

    Keep a short note explaining the code choice and any close alternatives you ruled out. If a bank, insurer, vendor, or reviewer questions the code later, you will have a clear answer.

How to find the "main activity"

Almost every good classification starts here. The main activity is the thing that best explains what the business is to its customers. When sales figures are available, the activity that brings in the most revenue is usually the strongest clue. When sales figures are not available, look at what the business promotes, what it delivers day to day, and what customers are paying for.

Quick tip: If a business both makes something and sells it, classify each location by what happens there. A factory that produces goods is classified differently from a store that sells those goods, even if both locations share the same brand name.

What about businesses that do a lot?

Most tricky cases fall into one of these four buckets.

Several services at once

Go with the service line that drives the business. If "consulting plus software" is mainly subscription software, classify it as software. If the real value is advising clients and implementation work, consulting may be the better fit.

One company, many locations

Classify each location by what it actually does. The plant gets a production code, the warehouse gets a logistics code, the office may get a headquarters or management code, and the storefront gets a retail code.

Stuck with an "other" category

"Other" and "not elsewhere classified" codes are valid, but only when nothing more specific fits. Re-read your one-sentence activity statement first and look for a closer match.

The business has changed

A code that fit a few years ago may not fit today. Re-check the code after new product lines, a merger, a different customer base, or a major shift in where revenue comes from.

Five mistakes to avoid

  • Classifying by job title. Code the business activity, not the owner's role.
  • Picking by a single product word. The same product can appear in many industries. Match the whole operation, not one keyword.
  • Grabbing a broad category because it sounds close. Choose the most specific code you can justify.
  • Coding the brand instead of the location. One company can legitimately have several codes across different sites.
  • Ignoring inclusions and exclusions. If a code description says an activity belongs somewhere else, do not force it.

See it in action

Common situations where the right code depends on what the business really does.

General contractor vs. specialty trade
A company that manages full building projects is different from a company that only performs plumbing, electrical, roofing, or another specialty trade. The deciding factor is the primary service the firm sells and delivers.
Manufacturer vs. retail store
If a location mainly manufactures products, classify it by the manufacturing activity. If a separate location mainly sells finished goods to consumers, classify that location by the matching retail activity.
Software publisher vs. IT consultant
A company mostly selling software subscriptions usually belongs with software publishing activity. A company mostly paid to advise, configure, integrate, or manage systems may fit better under computer systems design or consulting activity.
Corporate office vs. operating site
A headquarters office may be classified differently from the stores, plants, clinics, or warehouses it supports. The right code depends on whether you are classifying the company as a whole or a specific establishment.

When a code should be reviewed more carefully

Some businesses are easy to classify. A dentist office, roofing contractor, grocery store, or accounting firm usually has a straightforward primary activity. Other businesses need a closer look, especially when they combine products, services, software, manufacturing, distribution, and multiple locations.

A more careful review is usually worth it when the code will be used for lending, insurance, government reporting, vendor approval, compliance screening, market sizing, lead targeting, or data appending.

Want someone to confirm it for you?

If your code affects lending, insurance, vendor approval, regulated reporting, or customer risk review, a wrong guess can create problems. When the stakes are high, or when the business is genuinely hard to pin down, SICCODE.com can help review and confirm the classification.

Confirm Your NAICS or SIC Code

Frequently asked questions

How do I choose a code if my business does several things?

Pick the code for your main activity, usually the one that earns the most or best defines the business. If you run separate locations that do different things, each location can have its own code.

What if two descriptions both seem to fit?

Compare them for specificity and check whether either one lists activities it includes or excludes. Then match each option against what the business actually sells and delivers. Choose the code you can explain most clearly.

Is it bad to use an "other" category?

No. "Other" categories are valid when nothing more specific fits. They can be a sign that you need more detail, though, so re-check the activity description before settling on one.

Can one company have more than one code?

Yes. A single company can have different codes across different locations. For many uses, the right code is based on the establishment or location, not just the overall brand.

Keep exploring