When working with government organizations or submitting a proposal for a government contract, you as a business owner may have run into the words NAICS and PSC codes. Businesses and products are categorized using these identifiers for a variety of reasons. We’ll discuss what NAICS and PSC codes are, how to utilize them, and how to create an NAICS code for your company in this article.
The North American Industry Classification System, or NAICS, is a standardized method for categorizing companies according to their economic activities. To make economic research and reporting easier, the United States, Canada, and Mexico developed it. Six-digit NAICS codes are used to identify companies within particular industry.
The U.S. government uses a system known as PSC, or Product Service Code, to categorize the goods and services that federal agencies buy. Four-digit PSC codes are used to designate particular goods and services.
Federal agencies classify the goods and services they buy using government PSC codes. To guarantee accuracy and consistency in government procurement, each PSC code refers to a particular good or service. A PSC code, for instance, might be 7110 for office furniture and 7025 for computer hardware.
The U.S. Census Bureau assigns NAICS numbers to businesses based on their main line of business. Use the NAICS search tool on the Census Bureau website to obtain the correct code for your company if you are unsure of your NAICS code. You must include details about your company’s size and organizational structure, the industry you operate in, the goods or services you offer, and the products or services you offer in order to create an NAICS code for a new business. How many characters should the NAICS code have?
Six-digit NAICS codes are used to identify companies within particular industry. The industry sector is indicated by the first two numbers of the code, while the remaining four digits give more detailed information about the business activity.
Online retail is designated by the NAICS number 454110. This code is used to identify companies that sell their products mostly online. In addition, the NAICS codes 454111 for electronic stores, 454112 for computer and software retailers, and 454113 for mail-order houses are all related industries.
In conclusion, NAICS and PSC codes are crucial instruments for categorizing goods and services for a range of uses. Understanding these standards and how they are applied is crucial if you operate a firm and want to compete for government contracts. You may ensure that your company is classified correctly and raise your chances of commercial success by using the NAICS search tool and giving accurate information about your enterprise.
Businesses are categorized into industries using NAICS (North American Industry Classification System) codes for the purposes of data collection, analysis, and reporting. Since the NAICS system is intended to describe industries rather than different types of employment, there is no separate NAICS number for self-employed people. However, independent contractors can utilize NAICS codes to determine the industry to which their company belongs and to complete a variety of forms and applications that call for industry-specific information.
Instead of being an NAICS or PSC code, the Internal Revenue Service’s (IRS) tax code 812990 is particular to “All Other Personal Services.” Businesses who offer non-category-specific personal services are required to use this code. Personal shopper services, concierge firms, and personal training facilities are a few examples of companies that might be covered by this category.