The importance of selecting the appropriate UNSPSC for your business.

The importance of selecting the appropriate UNSPSC for your business.

By: M. Gonzalez – M&A SDC

Selecting the right United Nations Standard Products and Services Code (UNSPSC) is of great significance for small businesses. The UNSPSC is a widely recognized global coding standard used to classify products and services.

Here are several reasons why selecting the right UNSPSC is important for small businesses:

1. Clear categorization: The UNSPSC offers a comprehensive and standardized categorization framework. By selecting the appropriate code, small businesses can better classify their products and services, helping streamline procurement processes and enhance communication with customers, suppliers, and government agencies.

2. Improved visibility: When small businesses use the correct UNSPSC, it becomes easier for potential customers and partners to find them. Many online marketplaces, procurement systems, and databases use UNSPSC codes to classify products and services, making it crucial for small businesses to ensure their offerings are easily discoverable. 

3. Enhanced competitiveness: Properly categorizing products and services using the UNSPSC allows small businesses to position themselves in the right markets. By selecting the most appropriate code, they can accurately identify their competition, analyze industry trends, and tailor their marketing strategies accordingly.

4. Access to procurement opportunities: Governments and large corporations often require their suppliers to use UNSPSC codes when submitting bids for procurement opportunities. By selecting the correct code, small businesses can effectively participate in these opportunities, increasing their chances of winning contracts and expanding their customer base.

5. Streamlined reporting and analytics: Accurate classification of products and services using UNSPSC codes enables small businesses to generate meaningful reports and conduct valuable data analysis. This assists in understanding sales patterns, identifying growth opportunities, and making informed business decisions.

6. Standardized benchmarking: UNSPSC codes provide small businesses with a consistent framework for comparing their performance with industry peers. This allows for benchmarking against competitors, identifying areas for improvement, and adapting strategies to achieve higher efficiency.

7. Compliance with regulations: Certain regulations and standards may require small businesses to use specific UNSPSC codes when submitting reports or fulfilling legal obligations. By selecting the right codes, small businesses can ensure compliance and avoid potential penalties or reputational damage.

Selecting the right UNSPSC is crucial for small businesses as it offers clear categorization, improves visibility, enhances competitiveness, provides access to procurement opportunities, supports streamlined reporting and analytics, facilitates standardized benchmarking, and aids compliance with regulations. Taking the time to properly assign UNSPSC codes can bring significant benefits and contribute to long-term business success.

Here is an example for the 8 digits UNSPSC for construction and all the sub codes under the construction category:

UNSPSC code 72100000 Building Construction and Support and maintenance and repair services

The UNSPSC Code  72100000 is described as:
Building Construction and Support and maintenance and repair services

It belong to code group
UNSPSC code 72100000 Building Construction and Support and maintenance and repair services

To this code “72100000” belongs the sub code

  • UNSPSC code 72101500: Building support services
  • UNSPSC code 72101600: Roofing and siding and sheet metal work
  • UNSPSC code 72101700: Concrete work
  • UNSPSC code 72101800: Exterior Cleaning
  • UNSPSC code 72101900: Interior finishing
  • UNSPSC code 72102000: Coating and Caulking and weather and water and fireproofing 
  • UNSPSC code 72102100: Pest control
  • UNSPSC code 72102200: Electrical services
  • UNSPSC code 72102300: Plumbing and heating and air conditioning 
  • UNSPSC code 72102400: Painting and paper hanging 
  • UNSPSC code 72102500: Masonry and stonework and tile setting 
  • UNSPSC code 72102600: Carpentry
  • UNSPSC code 72102700: Flooring service
  • UNSPSC code 72102000: Refurbishing services
  • UNSPSC code 72102900: Grounds maintenance services
  • UNSPSC code 72103000: Site Preparation services