North American Industry Classification System (NAICS)
Reviewed by Dasha ShakovVP Marketing, Proton
Updated
What is NAICS?
The North American Industry Classification System (NAICS) is the code set the US, Canada and Mexico use to classify businesses by industry. Its codes have two to six digits, and it replaced the older four-digit Standard Industrial Classification (SIC) for US federal statistics in 1997, though SIC codes still appear in many business databases.
How it works
Distributors use NAICS codes to segment customers and prospects by industry, size up markets and buy targeted prospect lists. Each extra digit narrows the industry. In the US, wholesale trade is sector 42.
NAICS example
A marketing manager pulls every business in her state with the NAICS code for plastics manufacturing and compares the list with the customer file. Forty of the plants have never been called on.
Related terms
- VerticalA vertical is the industry segment a distributor operates in, such as electrical, plumbing, HVAC, industrial, jan/san, foodservice or medical supplies.
- Sales territoryA sales territory is the set of accounts, or the geographic area, that a sales rep is responsible for.
- Wallet shareWallet share is the percentage of a customer’s total spending on the products you sell that goes to your company rather than to competitors.
