NAICS codes are essential for businesses seeking federal contracts through the GSA Schedule program. These codes determine eligibility, align your services with GSA Special Item Numbers (SINs), and ensure compliance with small business standards.

Key Takeaways:

• What NAICS Codes Do: Classify businesses by industry and work type, helping agencies identify qualified vendors.
• Why They Matter: Incorrect codes can lead to GSA Schedule application rejections, bidding disqualifications, and missed opportunities.
• Restricted Codes: Wholesale (42) and Retail Trade (44, 45) NAICS codes are excluded from GSA Schedules.
• How to Fix Issues: Update your NAICS codes in SAM.gov, verify alignment with services, and ensure compliance with SBA size standards.

Pro Tip: Use GSA eLibrary’s SIN-to-NAICS mapping tool to check if your codes match the GSA categories you’re targeting.

Getting your NAICS codes right is critical for federal contracting success. Let’s dive deeper into how they connect to GSA eligibility and how to avoid common mistakes.

Using NAICS Code lookup & GSA SIN Comparing (2023) #SMB #government #contractor

Problems with Wrong NAICS Code Selection

Choosing the wrong NAICS code can seriously impact a business’s ability to secure federal contracts. This mistake not only puts contract approvals in jeopardy but also limits future bidding opportunities and complicates small business certifications.

GSA Schedule Award Rejection

An incorrect NAICS code can lead to a rejected GSA Schedule application. During the evaluation process, GSA contracting officers ensure that the selected codes match the services covered by specific Special Item Numbers (SINs). For instance, if a management consulting firm uses NAICS code 541511 (Custom Computer Programming Services), the application may be rejected because the services don’t align with the scope of the code.

Task Order Disqualification

Wrong NAICS codes can prevent businesses from qualifying for certain task orders. Contracting officers check whether the NAICS code aligns with the solicitation requirements for the task order. If there’s a mismatch, businesses are barred from bidding, no matter how capable they are. This issue is particularly problematic for small businesses aiming to qualify for set-aside opportunities.

Small Business Set-Aside Issues

For small businesses, selecting the correct NAICS code is critical when pursuing set-aside contracts. Proper alignment with SBA standards ensures compliance and eligibility, especially when tied to the GSA SIN requirements mentioned earlier.

Size Standard Misclassification

Using the wrong NAICS code can result in:

• Being excluded from set-aside contracts
• Losing small business status
• Violating terms of existing agreements

Limited Access to Opportunities

Small businesses may also face:

• Missed chances to bid on contracts within their area of expertise
• Restrictions from pursuing contracts they are fully qualified for
• Challenges with small business certification

These errors can severely limit a company’s ability to compete in federal contracting, regardless of its qualifications or capabilities.

How to Fix NAICS Code Problems

GSA NAICS Code Check Tools

The GSA eLibrary portal offers a handy SIN-to-NAICS mapping tool. This lets you cross-reference your NAICS codes with approved SINs, spot any conflicts, and ensure your codes meet compliance standards.

Once you’ve identified any issues, here’s a simple four-step process to address NAICS code problems.

4 Steps to Fix Wrong NAICS Codes

• Work Analysis Review
  Take a close look at your core services and past projects to make sure your NAICS codes align with what your business actually does.
• Update Your SAM.gov Profile
  Log into your SAM.gov account and head to the NAICS code section. Update both your primary and secondary NAICS codes based on your review. Keep in mind, updates can take about 24–48 hours to process.
• Submit an eModification
  Through your GSA vendor portal, file an eModification to update your contract with the corrected NAICS codes. Be sure to include documentation that shows your experience in the relevant areas.
• Verify Compliance
  Double-check that your updated NAICS codes:
  • Reflect your company’s core services
  • Meet current GSA Schedule requirements
  • Match your target SINs
  • Align with small business size standards

Allowed vs. Restricted NAICS Codes

When selecting NAICS codes, ensure they align with GSA guidelines and your company’s services. Use the GSA SIN-to-NAICS mapping tool to confirm your codes are within approved categories. Keep in mind that allowed and restricted codes can vary depending on the Schedule category. Avoid choosing codes tied to industries outside GSA’s procurement scope. Always consult the latest GSA guidelines to ensure your chosen NAICS codes are eligible for your contract.

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Keeping NAICS Codes Current

SAM.gov Yearly Updates

Once your NAICS codes are set, it’s crucial to keep them updated to ensure ongoing eligibility. Entity Administrators must renew their SAM.gov registration every year. During this renewal, double-check that your primary and secondary NAICS codes accurately reflect your business activities. Also, confirm your entity’s validation status and provide any additional documentation requested by SAM.gov. Starting March 8, 2025, all subaward reporting must be submitted directly through SAM.gov, as FSRS.gov will no longer be in use. These annual updates help keep your information aligned with the latest GSA requirements.

Tracking GSA SIN Changes

Keeping your SAM.gov profile updated is only part of the process. It’s equally important to stay informed about changes to GSA Schedule requirements. Updates to Special Item Numbers (SINs) can impact the relevance of your registered NAICS codes. To stay compliant, regularly review official GSA communications for any SIN updates and adjust your NAICS codes as needed.

Conclusion: Getting NAICS Codes Right

Getting your NAICS codes right is a critical step for achieving success with your GSA Schedule. Mistakes in selecting these codes are among the top reasons applications get rejected, with data showing administrative errors as a major culprit. Considering that only 4% of small businesses are currently on GSA Schedules, the importance of choosing accurate NAICS codes cannot be overstated – it directly affects your access to federal contracts.

To succeed, your NAICS codes need to align perfectly with your business offerings and the GSA Schedule Special Item Numbers (SINs) you’re targeting. As of June 2024, out of the more than 1,000 NAICS codes, only about 200 are represented on the GSA Multiple Award Schedule. This highlights the importance of precision and the updates discussed earlier to ensure a smooth federal contracting process.

But it doesn’t stop at initial accuracy. Keeping your NAICS codes updated is just as crucial for staying eligible with GSA. Here are some key practices to help you maintain compliance:

• Update your SAM.gov profile annually to reflect any changes in your services or SIN requirements.
• Check size standards compliance for each NAICS code you’ve registered.
• Document updates and notify contracting officers to keep everything in sync.

If navigating these requirements feels overwhelming, consider working with GSA Focus. Their expertise simplifies the GSA Schedule application process and helps you stay compliant while maximizing your chances of success in federal contracting.

FAQs

How do I choose the correct NAICS code to qualify for a GSA Schedule?

Selecting the right NAICS (North American Industry Classification System) code is a key step in ensuring your business qualifies for a GSA Schedule. This code needs to accurately reflect the core products or services your company provides, as it plays a big role in meeting GSA’s eligibility criteria.

To pinpoint the correct code, start by reviewing the official NAICS code directory and look for the description that closely aligns with your primary business activities. If you’re uncertain, it’s a smart idea to seek advice from a professional or a knowledgeable service provider. Mistakes here can lead to delays, as fixing an incorrect NAICS code after submission can be a lengthy process. Getting it right from the start will save you time and effort.

What should I do if my GSA Schedule application is denied because of incorrect NAICS codes?

If your GSA Schedule application was denied due to incorrect NAICS codes, don’t panic – this problem can be fixed with a few straightforward steps. Start by carefully reviewing your application to pinpoint the NAICS code(s) that led to the rejection. These codes need to accurately reflect your company’s primary business activities and the products or services you plan to offer through the GSA Schedule.

Once you’ve identified the issue, update your SAM.gov registration to include the correct NAICS codes. This step is essential because your GSA application must align perfectly with the information in your SAM profile. After making these corrections, you can resubmit your application. If you’re unsure about any part of the process, it might be wise to consult professionals who specialize in GSA Schedule applications. Their expertise can help you navigate the process and avoid similar setbacks in the future.

Selecting the right NAICS codes is critical for GSA eligibility, as these codes play a key role in determining your access to federal contracting opportunities. Taking the time to address and align your codes ensures you’re on the right track to move forward with confidence.

Why are some NAICS codes, such as those for wholesale and retail trade, not eligible for GSA Schedules?

Certain NAICS codes, such as those tied to wholesale and retail trade, are often excluded from GSA Schedules. This is because the GSA prioritizes working with businesses that deliver services or manufactured products. Wholesale and retail trade codes typically represent companies acting as resellers rather than direct providers of services or manufacturers, which doesn’t align with the GSA’s procurement objectives.

If your business falls under one of these restricted codes, it’s worth evaluating your offerings and selecting a NAICS code that better matches your actual activities and meets GSA eligibility standards. Choosing the right code is a key step to prevent delays or complications during the application process.

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