Wholesale Trade
- NAICS Code 42 - For Commercial Insurance

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Learn about Wholesale Trade - NAICS Code 42 - For Commercial Insurance. Insurance companies use NAICS codes to classify your industry and calculate your premiums. See all the six digit codes that fall under this primary NAICS class code for business insurance underwriting and cost purposes.

Wholesale Trade - NAICS Code 42 - For Commercial Insurance

Wholesale Trade - NAICS Code 42 - For Commercial Insurance

What's the best way to describe your company's business operations? Are you involved in the Wholesale Trade industry?

If so, then your business classification falls under Wholesale Trade - NAICS Code 42 - For Commercial Insurance. Insurance companies use NAICS codes to identify customers by industry code.

The NAICS sector code is a six digit number: the first two digits designate the largest business sector, the third digit designates the subsector, the fourth digit designates the industry group, and the fifth digit designates particular industries. The last digit designates national industries.

Sector 42 - Wholesale Trade - NAICS Manual

The Wholesale Trade sector comprises establishments engaged in wholesaling merchandise, generally without transformation, and rendering services incidental to the sale of merchandise. The merchandise described in this sector includes the outputs of agriculture, mining, manufacturing, and certain information industries, such as publishing.

The wholesaling process is an intermediate step in the distribution of merchandise. Wholesalers are organized to sell or arrange the purchase or sale of (a) goods for resale (i.e., goods sold to other wholesalers or retailers), (b) capital or durable nonconsumer goods, and (c) raw and intermediate materials and supplies used in production.

Wholesalers sell merchandise to other businesses and normally operate from a warehouse or office. These warehouses and offices are characterized by having little or no display of merchandise. In addition, neither the design nor the location of the premises is intended to solicit walk-in traffic. Wholesalers do not normally use advertising directed to the general public. Customers are generally reached initially via telephone, in-person marketing, or by specialized advertising that may include Internet and other electronic means. Follow-up orders are either vendor-initiated or client-initiated, generally based on previous sales, and typically exhibit strong ties between sellers and buyers. In fact, transactions are often conducted between wholesalers and clients that have long-standing business relationships.

This sector comprises two main types of wholesalers: merchant wholesalers that sell goods on their own account and business-to-business electronic markets, agents, and brokers that arrange sales and purchases for others generally for a commission or fee.

(1) Establishments that sell goods on their own account are known as wholesale merchants, distributors, jobbers, drop shippers, and import/export merchants. Also included as wholesale merchants are sales offices and sales branches (but not retail stores) maintained by manufacturing, refining, or mining enterprises apart from their plants or mines for the purpose of marketing their products and group purchasing organizations (e.g., purchasing and selling goods on their own account). Merchant wholesale establishments typically maintain their own warehouse, where they receive and handle goods for their customers. Goods are generally sold without transformation, but may include integral functions, such as sorting, packaging, labeling, and other marketing services.

(2) Establishments arranging for the purchase or sale of goods owned by others or purchasing goods, generally on a commission basis are known as business-to-business electronic markets, agents and brokers, commission merchants, import/export agents and brokers, auction companies, group purchasing organizations (e.g., purchasing or arranging for the purchases of goods owned by others), and manufacturers' representatives. These establishments operate from offices and generally do not own or handle the goods they sell.

Some wholesale establishments may be connected with a single manufacturer and promote and sell the particular manufacturer's products to a wide range of other wholesalers or retailers. Other wholesalers may be connected to a retail chain, or limited number of retail chains, and only provide a variety of products needed by that particular retail operation(s). These wholesalers may obtain the products from a wide range of manufacturers. Still other wholesalers may not take title to the goods, but act as agents and brokers for a commission.

Although, in general, wholesaling normally denotes sales in large volumes, durable nonconsumer goods may be sold in single units. Sales of capital or durable nonconsumer goods used in the production of goods and services, such as farm machinery, medium- and heavy-duty trucks, and industrial machinery, are always included in wholesale trade.

How NAICS Classifications Effects Your Commercial Insurance Cost

But how does your Wholesale Trade - NAICS Code 42 - For Commercial Insurance classification affect your premiums and insurance cost? Insurance companies selling commercial insurance use NAICS codes in many ways - to analyze and classify the businesses they insure, or choose not insure. Some small business NAICS code classifications can result in you paying higher premiums for your business insurance. It is important that your business is classified properly.

Industry codes help insurers with several analytical processes involving marketing, underwriting, exclusions, loss control, forms, pricing and other operations. Let's look at some of the the NAICS codes under your classification.

NAICS Structure

Following is a list of all the codes and titles. If the title is linked you can drill down for more information:

Wholesale Trade - NAICS Code 42 - For Commercial Insurance

We hope this information on Wholesale Trade - NAICS Code 42 - For Commercial Insurance has been helpful. Your classification determines how much you pay for your commercial insurance and much more.

More NAICS Sector Codes

Agriculture, Forestry, Fishing and Hunting, Mining, Utilities, Construction, Manufacturing, Wholesale Trade, Transportation and Warehousing, Information, Finance and Insurance, Real Estate Rental and Leasing, Professional, Scientific, and Technical Services, Management of Companies and Enterprises, Administrative and Support and Waste Management and Remediation Services, Educational Services, Health Care and Social Assistance, Arts, Entertainment, and Recreation, Accommodation and Food Services, Other Services (except Public Administration), Public Administration

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