What is UNSPSC?
How does UNSPSC work?
What types of products and services are covered by the code?
How does UNSPSC differ from other classifications?
How do I find a product or service in the code?
How can I apply UNSPSC to the Who Buys What report?
There is an account in my agency’s chart that covers several UNSPSCs
Where is the UNSPSC classification for ‘sundry’, ‘miscellaneous’, ‘general’ or ‘other’?
The United Nations Standard Products and Services Code (UNSPSC) an accurate and flexible classification system. It is an open global coding system that classifies products and services. UNSPSC is used extensively around the world in electronic catalogues, search engines, procurement application systems and accounting systems.
The Australian Procurement and Construction Council (APCC), which is the intergovernmental council of agencies from Commonwealth, State and Territory governments, and the New Zealand Government, responsible for procurement and construction policy, has endorsed UNSPSC.
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UNSPSC classifications are 8-digit numeric codes that describe individual products and services. Similar commodity classifications are grouped together into hierarchical categories to identify the relationships between commodities. The levels in the hierarchy are:
- Segment: The logical aggregation of families for analytical purposes.
Example: Engineering and research and technology based services
- Family: A commonly recognised group of inter-related commodity categories.
Example: Computer services
- Class: A group of commodities sharing a common use or function.
Example: System administrators
- Commodity: A group of substitutable products or services.
Example: Computer hardware maintenance or support
The classification links levels to each other.
A structural view of a UNSPSC classification looks like this:
81000000 Engineering and Research and Technology Based Services (segment)
81110000 Computer services (family)
81111800 System administrators (class)
81111808 Systems analysis (commodity)
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The UNSPSC covers raw materials, industrial equipment, equipment components and supplies, manufactured products and services, virtually any product or service that can be bought or sold. Version 8.0401 has in excess of 21,000 codes for everything from pencils to computers and accountancy, to cleaning services.
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The following paragraphs summarise the most well known classification systems.
ANZSIC: the Australian and New Zealand Standard Industrial Classification is used for industry related statistics in Australia and New Zealand. It classifies business and other organisations operations by the industry they belong to e.g. agriculture and mining.
NAICS & SIC: the North American Industry Classification System superseded the Standard Industry Classification as a system for describing the operations of businesses. It is the North American equivalent of ANZSIC and is used in the USA, Canada and Mexico. National statistical collection agencies and business analysis companies use NAICS and SIC in industrial statistics and analysis.
ANZSCC: Australian and New Zealand Standard Commodity Classification is a three-tier hierarchical commodity classification system produced by the Australian Bureau of Statistics for use in the collection and publication of statistics. It has not been widely used outside the Federal Government.
NATO: NATO Supply Code began 50 years ago and was one of the first commodity classification systems to be developed. It is a two-tier proprietary commodity classification system and was developed for inventory management of military supplies rather than commercial procurement. The WA Government adopted it for expenditure reporting, primarily because there were so few alternative systems available at the time. One of the problems of the NATO Supply Code has been its exclusion of service classifications.
HS: Harmonized System aka Harmonized Code, is used in customs documents for the purpose of applying tariffs in international trade. It is managed by the World Customs Organization and used by most countries. HS cannot be used for procurement because it does not include services.
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There are many ways to find the code you are looking for. Because UNSPSC is structured according to a hierarchy, a commonly used method is to start at the broad segment level and drill down to the commodity. Regular users also know that UNSPSC divides products and services into separate segments.
Sometimes a commodity may be difficult to find because of the different terms people have for the same thing. For example ‘allen keys’ and ‘allen wrenches’ and ‘hex keys’ are different terms for the same product.
Several suggestions may assist you in finding the correct UNSPSC classification:
- Browse through the hierarchy by drilling down from the top level
- Locate a UNSPSC using a keyword search of the database
- The standard Chart of Accounts (COA) developed by the Office of Shared Services has been mapped to UNSPSC. Compare the Shared Services COA to your chart to locate the correct UNSPSC
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There are two options for mapping your agency’s general ledger information to UNSPSC:
- Access the standard COA developed by Shared Services that has been mapped to UNSPSC to compare with your chart and locate the correct UNSPSC code
- Search the UNSPSC databases using the drill down or keyword method.
Not everyone is comfortable with the same search method and it is likely that people will use a combination of the methods described above.
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Some times agencies have a chart that combines expenditure while UNSPSC divides it into separate codes at the family level. For instance, ‘office consumables’ may be for desktop stationery, office paper and photocopier toner purchases. It is suggested that agencies adopt a ‘best fit’ approach.
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UNSPSC has more than 21,000 codes for everything from pencils to computers and accountancy to cleaning services. It doesn’t have a classification for ‘sundry’ or ‘miscellaneous’, as the point of using UNSPSC is to have a more detailed and meaningful view of government expenditure. You will need to review the types of products and services charged against your ‘sundry’, ‘miscellaneous’ and ‘other’ accounts to determine an appropriate UNSPSC classification, adopting a best fit approach.
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