SBA 7(a) Q&A
Short answer
The SBA determines if a business is 'small' based on its primary industry's NAICS code, using either average annual receipts over the past five years or average number of employees over the past 12 months, compared to published size standards.
Each industry, defined by its North American Industry Classification System (NAICS) code, has a specific size standard. A business is considered small if it falls below either the employee threshold or the revenue threshold for its primary industry. All affiliated businesses' revenues or employees are combined for this calculation.
A buyer wants to acquire a landscaping business (NAICS 561730). The SBA size standard for this industry might be $8 million in average annual receipts. If the acquired business, combined with any affiliated entities, has average annual receipts of $7.5 million over the last five years, it would be considered 'small' and eligible.
SOP 50 10 - Lender and Development Company Loan Programs
13 CFR Part 121 - Small Business Size Regulations
SBA Table of Size Standards
Affiliation and Lending Criteria for SBA Business Loan Programs - Final Rule
Last checked 2026-06-14. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-14 · SBA sources checked through 2026-06-14. DealRoom analysis of public SBA 7(a) lending records (FY2020–present). Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
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