What is a NAICS Size Standard?
GSA Schedule | 4 Min Read
If you are a current GSA contractor or potentially looking to sell products or services on the GSA Schedule, you’ll need to know how to find opportunities in your industry. Federal contracting requires research into potential costs, benefits, and initiatives like any other business decision. As a GSA Schedule Contractor, the North American Industry Classification System codes (NAICS) can help you better concisely comprehend what opportunities exist in your field for success in the federal marketplace, and can help your company determine if you are considered a small business.
Under the GSA MAS Consolidation, SINs, and NAICS Codes are often the same or share many similarities. Since SINs are what contractors use to classify the products and services they wish to sell to the government through a GSA Schedule contract, it is of the utmost importance that new and potential contractors understand what primary NAICS Code they have and how it affects them.
As a GSA Schedule contractor ourselves, we know NAICS Codes can decide whether you are able to take advantage of certain opportunities and set-asides for small businesses, making them a crucial identifier for your business. Below, I will go into further detail on NAICS size standards.
What is a NAICS Size Standard?
NAICS Codes are used to decide whether a company qualifies as a small business concern for federal contracting purposes. Your NAICS Code size standard is determined by either your business size in the number of employees or receipts in millions of dollars within an industry.
The Small Business Administration (SBA) lists the relevant size standards for your primary NAICS Code on its website. This eliminates a lot of the guesswork and uncertainty, allowing for a quicker, easier, and more objective method of determining business size.
Each contractor requires at least one NAICS Code as a primary NAICS code, which you can find on your GSA eLibrary. If you are already a GSA Schedule contractor, you can find your NAICS Codes by searching for your company’s SAM.gov profile and going into your representations and certifications page. The size standard of your business in each of the NAICS codes you have established with the GSA is listed under FAR 52.212-3: Offeror Representations and Certifications Commercial Items. The information will be listed in a table that describes the size standards for each NAICS Code of your business and whether it meets the small business threshold. This is important to keep track of for contract compliance and marketing purposes.
It’s important to note that size standards were recently updated, so if you didn’t qualify as a small business before, you might now.
Why Are NAICS Size Standards Beneficial?
One of the benefits of knowing your NAICS Code size standard is that it allows you to determine whether you are eligible for certain GSA contracting set-asides. The SBA requires NAICS Codes in order to determine your size standard to receive SBA certification for set-aside opportunities.
If you are considered a small business within your NAICS Code, that means that you are eligible for small business set-asides. Due to the small business size status, GSA is especially interested in ensuring your success, as agencies can purchase from you and meet some of their socioeconomic concern requirements.
For small business set-asides, contracts between $3,500 and $150,000 must be set aside for small businesses, and contracts of $150,000 or more are required to be set aside if there are two or more small business contractors who could fulfill the job. The SBA must approve plans for “other than small” businesses that are prime contractors to use small businesses as subcontractors. Other than small businesses are simply businesses that do not meet the requirements to be determined by small businesses according to their NAICS Codes.
How to Get the Maximum Potential Out of your NAICS Code
Once you have figured out your size standard, if you are considered a small business, you should market yourself as a small business with the proper designations and ensure that your company adds its small business designations to its text file and ensures that SAM is up-to-date. This will allow both agencies to look to meet their small business subcontracting goals as well as prime contractors who are looking for a subcontractor to partner with. Ensuring that your small business size is marketed to both commercial and federal entities is a win-win for all parties involved.
Most importantly, this information is required by GSA and easily available in SAM, so as a contractor you need to ensure it’s up-to-date. It’s especially important to ensure you stay on top of the ever-changing requirements as the size standards can change from year-to-year. Usually, when the SBA updates the size standards, inflation and other market factors are taken into consideration when creating those numbers.
It is helpful to keep in mind that if your business grows beyond the designated “small” size, you will need to submit a modification to ensure that it is properly updated in the GSA systems. Additionally, as previously noted above, your company will need to formulate a small business subcontracting plan to meet GSA’s goals.
As both a small business or an “other than small” business, you can also use NAICS Codes to identify relevant contracting opportunities in eBuy and SAM.gov along with other acquisition sites. It’ll help you drastically narrow down the search results and find opportunities that you are able to realistically go after and fulfill.
Need Help with Your GSA Schedule?
If you are looking to get a good idea of whether your business would qualify as a small business, you can utilize the SBA’s size standards tool to determine this. Once you have learned the size standard of your business or its component NAICS codes, you will have a better idea of the opportunities that are available to your business in the federal market.
Some contractors are unsure about their size standards due to having multiple different NAICS Codes. If you’re still unsure, one of our Winvale consultants would be happy to help you understand your NAICS Codes. If you have any other questions about your GSA Schedule or are looking to get one, contact us today.