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NAICS Business Implications

Learn about the NAICS system and its implications for businesses. Discover how NAICS can help with strategic planning, market sizing, contract management, and purchasing/supply management. Find out how Global Insight can assist with data history, creating NAICS proxies, and re-specifying company models.

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NAICS Business Implications

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  1. NAICS Business Implications Frantz Price Managing Director, Industry Practices Atlanta Seminar April 29, 2003

  2. Why NAICS? • Replaces Old SIC System • Developed in 1930’s • Emphasis on Manufacturing • Last Revised in 1987 • Little Change in Original Structure

  3. Why NAICS? • Reflects Economic Reality • New and Emerging Industries • New and Advanced Technologies • Importance of Services and Information • Comparability with Canada and Mexico • Detailed Coverage to 6-Digit Level • 2-Digit Compatibility with ISIC

  4. SIC-to-NAICS Four Basic Categories of Change • New Industries • Redefined Industries • Industries with slightly different compositions • Reclassified Industries

  5. Manufacturing Sector Reorganized New Computer/Semiconductor Sub-sector New Information Sector Publishing Broadcasting/Telecom Motion Picture/Sound Recording Information/Data Processing New Restaurants/Accommodations Sector Expanded Services Detail Professional, Technical, and Scientific Waste Management Healthcare Educational Wholesale/Retail Redefined Finance Industries Restructured Credit Card Issuing Investment Banking Highlights

  6. Goods-Producing Sectors • Natural Resources and Mining • Sector 11 (Agriculture, forestry, fishing and hunting) • Sector 21 (Mining) • Construction • Sector 23 (Construction) • Manufacturing • Sector 31-33 (Manufacturing)

  7. Service-Producing Sectors • Trade, Transportation, and Utilities Sector 42 (Wholesale trade) Sector 44-45 (Retail trade) Sector 48-49 (Transportation and warehousing) Sector 22 (Utilities) • Information Sector 51 (Information) • Financial and Related Sector 52 (Finance and insurance) Sector 53 (Real estate & rental and leasing) • Professional and Business Sector 54 (Professional, scientific, and technical services) Sector 55 (Management of companies and enterprises) Sector 56 (Administrative and support and waste management and remediation services) • Education and Healthcare • Sector 61 (Education services) • Sector 62 (Health care and social assistance) • Leisure and Hospitality • Sector 71 (Arts, entertainment, and recreation) • Sector 72 (Accommodation and food services) • Other • Sector 81 (Other services, except public administration) • Public Administration • Sector 92 (Public administration) • Unclassified • Sector 99 (Unclassified)

  8. NAICS Implications: Strategic Planning/Market Sizing • Sales Modeling/Forecasts • Benchmarking • Budgets/Long-Term Plans • Portfolio/Lending Decisions • NAICS Conversion Schedule for Relevant Indicators: • Shipments, Orders, Inventories –2001 • Industrial Production Indexes –December 2002

  9. NAICS Implications: Contract Management • Forward Pricing • Escalator Clauses • Litigations • NAICS Conversion Schedule for Relevant Indicators: • Average Hourly Earnings –June 2003 • Producer Price Indexes (SIC-based PPIs) –February 2004

  10. NAICS Implications: Purchasing/Supply Management • Negotiation with Suppliers • Cost Monitoring/Benchmarking • Budgets/Long-Term Plans • NAICS Conversion Schedule for Relevant Indicators: • Average Hourly Earnings –June 2003 • Producer Price Indexes (SIC-based PPIs) –February 2004

  11. How Can Global Insight Help? • Identify Best NAICS Proxies • Create Data History • Re-Specify Company Models • Staff Training

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