Glossary · Reading the business
In short
The North American Industry Classification System code is a numerical code classifying businesses by industry. For a buyer, it's crucial because it determines SBA eligibility and size standards for the target business.
The SBA uses the primary NAICS code of a business to determine if it meets size standards and is eligible for a 7(a) loan. Verify the business's stated NAICS code during due diligence. Confirm it aligns with the business's actual primary operations and that it doesn't fall under an ineligible business category.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
Pressure-test the numbers before you make an offer
Send us the asking price and the seller's cash flow — we'll show whether the deal services SBA debt and where the add-backs are likely to hold up.
Free · No documents · Usually same-day