How NAICS Codes AffectSet-Aside Eligibility
Your NAICS code does more than classify your industry. It determines your SBA size standard, which directly controls whether you qualify as a small business for set-aside contracts.
Definition
NAICS codes determine set-aside eligibility by linking each industry to a specific SBA size standard. That size standard defines the maximum revenue or employee count a business can have while still qualifying as small, which is the baseline requirement for competing on set-aside government contracts.
Key Takeaways
- Every government contract solicitation is assigned a NAICS code by the contracting officer, and that code determines which size standard applies.
- SBA size standards vary significantly by NAICS code, ranging from $1M to $47M in revenue or 100 to 1,500 employees.
- Your business may qualify as small under one NAICS code but not another, meaning eligibility is contract-specific.
- WOSB set-asides are restricted to specific NAICS codes where the SBA has identified underrepresentation of women-owned businesses.
- Choosing the wrong NAICS code on a bid can disqualify you, even if you would have qualified under the correct code.
The Relationship: NAICS to Set-Aside
Understanding the chain from industry code to contract eligibility
NAICS Codes Define Industry
The North American Industry Classification System assigns a 6-digit code to every type of business activity. Each government solicitation is tagged with a NAICS code based on its principal purpose.
SBA Sets Size Standards
The SBA assigns a unique size standard to each NAICS code. These standards set the maximum annual revenue or employee count for a business to qualify as "small" in that industry.
Size Determines Status
When a contract is posted with a NAICS code, only businesses that meet the corresponding size standard qualify as small businesses for that specific opportunity.
Set-Asides Require Status
Set-aside contracts require bidders to be certified small businesses under the assigned NAICS code. No small business status means no eligibility for set-aside competition.
NAICS Codes, Size Standards, and Set-Aside Eligibility
How size standards and available set-asides vary across common NAICS codes
| NAICS Code | Industry | Size Standard | Eligible Set-Asides |
|---|---|---|---|
| 541511 | Custom Computer Programming | $34M revenue | 8(a), SDVOSB, HUBZone, WOSB |
| 541330 | Engineering Services | $25.5M revenue | 8(a), SDVOSB, HUBZone |
| 236220 | Commercial Building Construction | $45M revenue | 8(a), SDVOSB, HUBZone |
| 561210 | Facilities Support Services | $47M revenue | 8(a), SDVOSB, HUBZone, WOSB |
| 541519 | Other Computer Related Services | $34M revenue | 8(a), SDVOSB, HUBZone, WOSB |
| 238220 | Plumbing, Heating, and AC Contractors | $19M revenue | 8(a), SDVOSB, HUBZone |
Size standards shown are approximate and subject to change. WOSB eligibility depends on SBA-designated NAICS codes. Verify current standards at SBA.gov.
How to Check Your Set-Aside Eligibility
Follow these steps to determine which set-aside programs you qualify for under your NAICS codes
Identify your primary NAICS codes
Determine which 6-digit NAICS codes best describe the products or services your business provides. Use the Census Bureau NAICS search tool or the SBA size standards table for reference.
Look up the SBA size standard for each code
Visit the SBA size standards page to find the revenue or employee threshold for each of your NAICS codes. Note that standards differ significantly between codes.
Calculate your business size
For revenue-based standards, calculate your average annual receipts over the last 5 fiscal years (or 3 years for some industries). For employee-based standards, calculate your average number of employees over 24 months.
Compare your size to the standard
If your calculated size is at or below the threshold for a given NAICS code, you qualify as a small business for contracts under that code. Check each NAICS code individually.
Verify set-aside program eligibility
Confirm you hold the required SBA certifications (8(a), SDVOSB, WOSB, HUBZone) for the specific set-aside programs. For WOSB, verify your NAICS code is on the SBA designated list.
Register and update SAM.gov
Ensure your SAM.gov profile lists all applicable NAICS codes and that your certifications are current. Contracting officers use SAM.gov data to verify eligibility.
Common Mistakes to Avoid
Errors that cost contractors set-aside eligibility or lead to bid disqualification
Choosing the Wrong NAICS Code
Bidding under a NAICS code that does not match your actual capabilities raises red flags with contracting officers. If challenged by a competitor, the SBA can conduct a size protest that disqualifies your bid.
Not Checking Size Standards
Many contractors assume they are small without verifying. Size standards range from $1M to $47M in revenue depending on NAICS code. A business that is small under one code may be large under another.
Assuming All Set-Asides Apply
WOSB and EDWOSB set-asides are limited to SBA-designated NAICS codes. Bidding on a WOSB set-aside under a non-designated NAICS code will result in rejection, regardless of your certification status.
Why This Matters for Contractors
Understanding the relationship between NAICS codes and set-aside eligibility is not optional. It is the foundation of your government contracting strategy. Contractors who get this wrong waste time bidding on contracts they cannot win or miss set-aside opportunities they are qualified for.
The federal government awards over $150 billion annually to small businesses. Your NAICS code is the gatekeeper to that spending. By selecting the right codes, verifying your size status, and understanding which set-asides apply, you position your business to compete where your odds of winning are highest.
Related Resources
Explore tools and guides related to NAICS codes and set-aside programs
Set-Aside Programs Guide
Overview of 8(a), SDVOSB, WOSB, and HUBZone programs
Set-Aside Contracts
Browse active set-aside contract opportunities
Browse All Contracts
Search contracts and filter by NAICS code
Glossary
Look up NAICS, set-aside, and other contracting terms
SBA Size Standards
Official SBA size standards table by NAICS code
NAICS Search (Census)
Official NAICS code lookup tool
Frequently Asked Questions
Common questions about NAICS codes and set-aside eligibility
Can my NAICS code change which set-asides I qualify for?
Yes. Your NAICS code determines the SBA size standard applied to your business. Different NAICS codes have different revenue or employee thresholds. If a contracting opportunity uses a NAICS code where your business exceeds the size standard, you would not qualify as a small business for that specific contract, even if you qualify under other NAICS codes.
How many NAICS codes can a business have?
There is no limit to how many NAICS codes a business can list in SAM.gov. However, you should only claim NAICS codes that genuinely reflect your business capabilities. Contracting officers evaluate whether your past performance aligns with the NAICS code assigned to an opportunity. Listing irrelevant codes does not improve your eligibility.
Who assigns the NAICS code to a government contract?
The contracting officer assigns the NAICS code to each solicitation based on the principal purpose of the acquisition. If you believe the wrong NAICS code was assigned, you can file a NAICS code appeal with the SBA Office of Hearings and Appeals within 10 calendar days of the solicitation being posted.
What happens if my business grows past the size standard for my NAICS code?
If your business exceeds the SBA size standard for a particular NAICS code, you lose small business status for contracts under that code. However, you may still qualify as a small business under other NAICS codes with higher thresholds. The SBA also provides a recertification process and transitional rules for businesses on existing contracts.
Are WOSB set-asides available for all NAICS codes?
No. WOSB and EDWOSB set-asides are only available in NAICS codes where the SBA has determined that women-owned small businesses are underrepresented or substantially underrepresented. The SBA publishes a list of eligible NAICS codes. This is different from 8(a), SDVOSB, and HUBZone set-asides, which are available across all NAICS codes.
Find Set-Aside Contracts Matching Your NAICS Codes
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