Selecting the right NAICS code can make or break your next procurement.

Picking the proper NAICS code is often one of those tasks that we as contracting professionals do but we do it almost routinely. Many times, not too much thought is put into it and we rely on those codes we are familiar with, especially if we deal in a small range of products or services. For instance, those who work in a contracting office that supports environmental services, there are only a few NAICS codes that are strictly for environmental remediation and support services.

However, choosing the right NAICS code can make a big difference. Think of what you do with that code. You use it to conduct market research. The results of that market research are used to determine contract type, whether the requirement is for a commercial item or service, and even whether or not you can set aside the requirement for small business. That in turn affects the amount of competition for the award as well as whether an unrestricted solicitation is made.

The contractor has limited appeals for your selection. The Small Business Administration's Office of Hearings and Appeals is the appeal authority. A small business contractor might appeal for one of two reasons (see page two of this linked newsletter): to limit competition to just themselves (or a very few) by getting a more restrictive size standard, or to expand the size standard to allow access to that requirement. Of course, a large business would want a very restricted NAICS code that would have fewer than 2 potential offerors which would allow for an unrestricted requirement.

So, choose your NAICS code carefully.