Why Are SIC Codes Important To Shipping?

Every business has to be registered with the government. With so many businesses in the country, the government needs a way to identify each individual category of businesses. This is the reason why Standard Industrial Classification (SIC) codes exist.

What are SIC codes?

SIC code is a four-digit number given to businesses by the US government to help the establishment identify their primary business. The codes were developed to make the collection of data easier and to promote uniformity among the different types of data collected by various government and private agencies. Every economic activity has an SIC code.

SIC codes divide the economy into eleven groups, which are further divided into 83 major groups, and then subdivided into subdivided into 416 industry groups. The industry groups are divided into 1,005 industries. The primary line of business of a company is determined by the business that brings the highest revenue. Irrespective of how many businesses a company has, there will always be a primary SIC code.

How do businesses use SIC Codes?

Businesses use SIC codes for a lot of reasons. Some of them are:

• For identifying customers by industry code
• For segmenting markets for marketing campaigns
• For identifying public and private competitors
• For identifying government contracts by their SIC description
• For State and Federal registrations
• For getting a Data Universal Numbering System (DUNS) number
• For tax purposes

Importance of SIC code in freight shipping

The SIC code of Transportation of Freight and Cargo is 4731. Establishments with this SIC code act as agents for arranging transportation of freight and cargo. Some of the others included in this industry are freight forwarders, which are establishments that transport the goods from shippers to receivers but charge the amount required for the whole transportation.

Some of the others included in this category are:

• Shipping auditors
• Shipping brokers
• Transportation brokers
• Tariff consultants
• Domestic and foreign forwarding
• Freight consolidation
• Freight forwarding
• Freight rate information service
• Shipping documents preparation

Why use SIC codes?

SIC codes help a shipping or freight company to classify goods into the right product category. When a product is shipped in the wrong category, it causes delays and losses. By putting goods into the right categories, shipping is done on time and inconveniences avoided.

Performance Plus Global is an international shipping company that regularly uses SIC codes to categorize goods. Get in touch to utilize fast, efficient freight services.