Retail Classification Codes in Europe and Venice

Post date: Sep 21, 2015 8:4:37 PM

This week I decided to take a look at how the European Union classifies their retail sector, and I discovered they use an industry standard called NACE, Nomenclature des Activités Économiques dans la Communauté Européene which is French for the Nomenclature of Economic Activities. This statistical categorization of stores was developed in the 1970s and is useful for separating businesses throughout Europe based on what service they offer or what product they sell. Upon further research, it turns out that this standard is based on the United Nations system for classify economic activity called the International Standard Industrial Classification system, or ISIC. According to SICCode.com, "The ISIC and NACE have exactly the same items at the highest level, where NACE is more detailed at lower levels". Another similar classification code that exists is the Standard Industrial Classification which is the version of retail classification codes used in the United States since 1937. A diagram further explaining the NACE standard is shown below in Figure 1.

I also took a look at a previous IQP called "The Merchants of Venice : A Look at the Changes in the Venetian Stores and Tourist Accommodations and Their Impact on the Local Population". This IQP focused greatly on classifying the stores in Venice, and after reading through their paper it is clear that the NACE codes, while commonly used, are not specific enough for our purposes and research on the retail face of the city. For example, the NACE standard stops at leather goods, but it does not separate stores that sell leather gloves or leaver handbags or leather shoes. To get this extra layer of distinction this previous team added a fifth element to the four component NACE codes, and an example of this new system can be shown below in Figure 2.

The information of this new standard of classification of stores currently being used in the IQP Venice database will be extremely important for our team since we will be going into the city and categorizing all the shops and stalls for 2015. We will have to do more research on the system developed by this previous team since they fail to give an Appendix that was supposed to contain more information of the system they developed. Check out our blog next week to see what we're investigating next!

Figure 1 : The above figure was taken from the paper IQP Paper "The Merchants of Venice : A Look at the Changes in the Venetian Stores and Tourist Accommodations and Their Impact on the Local Population" and show an excellent diagram of how the NACE codes work. To see more NACE codes click : here !

Figure 2 : The above figure was taken from the IQP Paper "The Merchants of Venice : A Look at the Changes in the Venetian Stores and Tourist Accommodations and Their Impact on the Local Population" and shows an example of the new system of categorizing the shops in Venice based on extending the NACE standards.