These governmental benchmarks define the maximum size a business can be and still be considered small. The determination considers industry classifications outlined in the North American Industry Classification System (NAICS). These codes categorize businesses based on their primary business activity. For example, a manufacturer might be considered small if it has 500 employees, while a service provider may have a higher revenue threshold.
Adherence to the size limits permits businesses to participate in government contracting programs and receive access to small business loans. This access fosters economic growth and job creation by leveling the playing field. The establishment of these parameters has a long history, evolving over time to reflect changes in the economy and to better target support to the most deserving businesses. These thresholds influence set-aside contracts, enabling smaller entities to compete for and win federal contracts, boosting their revenue and experience.
