SIC stands for Standard Industrial Classification. A SIC code for business is an industry-specific classification that classifies manufacturing plants, wholesale distributors, and retailers of manufactured goods.
Selling these three types of businesses has different risks depending on their size but it’s essential you stay up to date with what they need from a company like yours in order not only to take care of them well but also to make your own work easier.
The United States Government assigns four-digit numerical codes to industries, which categorize the business activities of companies. These SIC Codes can be used as an organizing tool for both businesses and government officials who are looking to better understand what your company does or how it compares with other similar entities in this country.
Divisions Of SIC
There are 11 major divisions in the economy. The first and most important to understand is known as SIC. This system classifies industries into one of several categories based on their economic activity, which can range from agriculture (SOC) or manufacturing (MN), up through retail trade/wholesaling, etc. The second classification groupings include NAICS for National Level Statistics; Business Environment Statistics such as Gross Output Values by industry type at current exchange rates.; regional statistics like Purchasing Managers Indexes (PMI).
The division is as follows,
- Agriculture, forestry, and fishing
- Transportation and public utilities
- Wholesale trade
- Retail trade
- Finance, insurance, real estate
- Public administration
- Nonclassifiable establishments
The SIC code system has been overhauled every few years to account for new industries and changing structures. While 2007 is currently in effect, it’s possible to go back as far at you need to by checking out previous codes.
Despite the introduction and use of NAICS codes, SIC codes are still used in some circumstances. For example, they’re useful if you need to compare data across countries or time periods because it allows people who work with numbers on an industrial level (i.e., accountants) easily identify how different industries contribute towards gross domestic product – which is significant for economic growth.
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