How Can NAICS Codes Help You Diversify Your Sales?

Adopted in the late 1990s, the North American Industry Classification System (NAICS) consists of codes set up by the U.S. Census Bureau to separate manufacturers by sectors, subsectors, and industries. Most companies are familiar with this system at a high level, as it’s used by the government to collect, assess, and distribute data about manufacturing in 5-6 year cycles.

However, if analyzed properly, NAICS codes can be far more important than simple identifiers used for federal purposes – in fact, they can play an active role in your company’s long-term strategy.

If you’re looking to diversify your sales into new and growing markets, it’s important to analyze your competitors are already doing, and NAICS codes offer insight into some goods, services, and capabilities your competition is currently offering to their clients. The NAICS structure assigns two different sets of codes: a primary code based on the single manufacturing process that generates the largest sales for your company, and multiple secondary codes for your other (if applicable) major sales generating services. The majority of competing manufacturers – sometimes clients, even – are assigned the same codes, and targeted market research enables a company to compare and contrast what services they offer to what their competition may or may not be offering.

But how can you use this information to stay ahead of the pack?

First, if you don’t know your primary or secondary NAICS codes off hand, you can try to identify them via the U.S. Census website or by reaching out to MAGNET and utilizing our resources. Next, spend some time researching how your codes compare that those of your top competitors: How much overlap is there? Do gaps exist?

Second, brainstorm ways to differentiate your company from others in your industry. What processes and products do you offer that they don’t (and vice versa)? Are you marketing your top service offerings in a way that is consistent with your brand and value proposition?

Third, investigate options for further, more detailed competitor analysis. When applied appropriately, the NAICS system can lead to vetted customer prospects that would allow your company to penetrate new markets, thus diversifying your current offerings and generating additional revenue in the long term.

Finally, seek help from the experts at MAGNET. If you want to know more about how you can create top-line growth by harnessing the power of your NAICS codes, please contact Linda Barita at 216.391.7766 or email linda.barita@magnetwork.org to get started. You can also contact me at timothy.nevin@magnetwork.org.

Print
Posted by Tim Nevin in Sales and Marketing

Most Recent

MAGNET’S 2018 NORTHEAST OHIO MANUFACTURING SURVEY: EXECUTIVE SUMMARY

February 22, 2018 by Sam Wasylyshyn

HEADLINE The survey definitively shows that product innovation leads to more growth, while “grow your own workforce” strategies will be needed to fill the major labor shortages hampering small manufacturer growth. Emerging technologies like the Internet of Things (IoT), 3D printing, and digital manufacturing are beginning to enhance innovation and productivity, but still have significant room for adoption amongst Ohio’s small manufacturing businesses. ABOUT THE SURVEY Under the direction of the Ohio Manufacturing Extension Partnership (Ohio MEP), MAGNET: The Manufacturing Advocacy and Growth Network conducted a thorough survey of Ohio’s manufacturing base. Contributing approximately 20% of Ohio’s jobs (and driving in some regions up to 50% of Ohio’s economy), and generating a disproportionate amount of export revenues and Gross Regional Product, manufacturing is critical to Ohio. Greater than 95% of Ohio’s manufacturers are small (under 500 employees), and these manufacturers need to remain competitive both nationally and internationally to ensure our economy’s health. Ohio’s Development Services Agency and the National Institute of Standards and Technology, which runs the MEP, recognizes the importance of this sector and fuels MAGNET and the Ohio MEP program to directly serve and support innovation, efficiency, and growth in small and medium manufacturers. What manufacturers need

Manufacturing is Facing a New Reality

February 06, 2018 by Sam Wasylyshyn

How Virtual Reality and Augmented Reality Can Help Keep Our Engineers Safe and Our Manufacturing Strong Recall how difficult it was to put together complex LEGO creations when you were a child or helping a child. Now, picture assembling a fighter plane from a room full of parts. Even highly trained engineers can benefit from technology to help improve consistency and quality. Virtual reality (VR) and augmented reality (AR) are making near-perfect assembly a possibility in the manufacturing space. By wearing AR glasses that use cameras, depth sensors and motion sensors to overlay images onto the real working environment, engineers and factory workers can visualize the exact bolts, parts, part numbers and instructions on how to assemble a particular component correctly. Lockheed Martin began using AR goggles and improved F-35 assembly time by 30 percent, in addition to increasing accuracy to 96 percent[1]. In order to remain competitive, businesses should consider the ways VR and AR can improve efficiency and supply chain productivity. According to a recent BofA Merrill Lynch Global Research report[2], AR platforms can provide companies up to 25 percent in cost savings on installation of equipment. Here are four ways VR/AR is disrupting the mid-market manufacturing space:

Is Technology Your Thing? Connect with TechLink

February 06, 2018 by Sam Wasylyshyn

Why should you consider TechLink? To date: More than 1,270 technology transfer partnerships brokered between companies and 110 DoD labs or centers, including all 65 DoD labs that generate patented inventions More than 600 license agreements facilitated between DoD and companies nationwide, transferring over 1,000 DoD inventions to industry Facilitated 60% of total DoD licensing agreements over the past 10 years What does TechLink Specialize in? TechLink specializes in 10 technology areas: Energy, BioTech, Materials, Sensors, Photonics, Software/Info Technology, Military Technology, Electronics and Environmental Technologies. 4 Ways TechLink can help you: Actively market DoD inventions to industry nationwide Help companies evaluate these inventions and submit license applications Facilitate communications between DoD labs and companies leading to “win-win” license agreements for both parties Maintain the nation’s only comprehensive database of DoD-patented inventions, fully searchable through techlinkcenter.org Why should you believe in TechLink? Check out the TechLink technology database and the Technology Spotlight for regular updates on available technologies and contact information for the related Technology Manager. The Manager will help you assess the technology for your company needs, facilitate your connection with DoD, and walk you through the licensing process. Most DoD inventions have civilian and commercial applications. DoD technologies licensed by TechLink have generated