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Export, Innovate, Invest - The Canadian Trade Commissioner Service
May 2013
Overview - Selling to United Nations Agencies: A Guide for Canadian Businesses
In its 2011 fiscal year (July 1-June 30), the United Nations procured more than $14 billion1 in goods
and services that covered almost everything from vaccines to air freight. According to the 2011
Annual Statistical Report on United Nations Procurement, Canadian businesses accounted for
$147 million of this total, with sales of $121 million in services (primarily in transportation,
environmental management and construction) and $26 million in goods (including food,
pharmaceuticals, election equipment, computer equipment and nuclear research equipment).
Identifying opportunities with UN agencies
It's clear from the above statistics that UN agencies can be good sales prospects for Canadian
businesses whose products match their needs. To determine whether your company falls into this
category, you can begin with the UN's statistical procurement reports, such as the one above. These
will give you information about the top 10 items procured annually by various UN agencies.
You should also check the Procurement Notice Search section of the United Nations Global
Marketplace(UNGM) website. UNGM is the procurement portal for registered UN vendors, but you
don't have to register in order to search the data in the Notices section. This information can be very
useful in determining current agency needs.
You might also be able to supply UN agencies indirectly by subcontracting with companies that have
already secured agency contracts. You can find information about these contracts in
UNGM's Contract Award Searchsection. You don't have to be a registered UN vendor to access the
data, and examining the award details may reveal opportunities for selling your products to the
company that landed the contract.
Although there are many agencies under the UN umbrella, eight of them account for more than 90
percent of all UN procurement. Consequently, although reviewing the annual statistical reports and the
UNGM databases is certainly important, you should also be sure to check the online supply catalogues
of these agencies (where applicable) for more detail about their procurement needs. The eight agencies
are:
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UN Procurement Division (UNPD)
UN Development Programme (UNDP)
World Food Programme (WFP)
UN International Children's Emergency Fund (UNICEF)
UN Office for Project Services (UNOPS)
UN High Commissioner for Refugees (UNHCR)
Pan American Health Organization (PAHO)
UN Population Fund (UNFPA)
Different agencies may also have different procurement rules, so you'll need to verify that your
products2 and your company meet the eligibility requirements of a particular organization. Many UN
agencies use their websites to publish lists of the products they procure, as well as their procurement
policies and guidelines. Procurement details for the eight agencies listed in the previous section can be
found at:
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UNPD Supplier Resources
Procurement at UNDP
WFP Procurement
UNICEF Supplies and Logistics
UNOPS What we need
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Doing business with UNHCR
PAHO Procurement
UNFPA Procurement
Numerous other UN organizations also purchase goods and services. You can find information about
them on their websites or through the Canadian Trade Commissioners' Development and
Humanitarian Aid Marketswebsite.
UN agencies have strict regulations on the capabilities of their suppliers. A supplier, for example, is
required to have at least three years of export experience in order to do business with a UN agency,
unless the UN operation is in Canada. Other ability-related questions include:
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Does your company have the production capacity, personnel and financial resources to
deliver the contracted products?
Can your company comply with the UN Supplier Code of Conduct? (PDF* 109 Kb).
Can your company comply with the quality control standards the UN requires for your types
of product, such as ISO certification?
Is your business able to provide staff members who speak the local language, if this is
required for a contract?
Having a partner or a network in a specific country or region could be important if you want
to become a UN supplier. Do you have access to such networks or partners, or could you
develop them quickly if you secured a contract?
Would you be able to deliver emergency-related goods on very short notice if required?
The evaluation of UN procurement bids can take up 12 months. Are you willing and able to
wait that long to find out if you have secured a contract?
Registering as a vendor with the UN
Assuming your company is capable of furnishing products to the UN, the next step is to register as a
vendor. You do this through the UNGM website, which is the procurement portal for 20 major UN
agencies. You'll find detailed registration instructions in the UNGM Interactive Guide (PDF*, 1.6
Mb), but the basic procedure is as follows.
First, complete and submit the UNGM registration form. You'll receive an email in response, with a
link for activating your UNGM account. After you activate, you'll receive another email with a
username and password for the account.
Log onto the account, complete the application using the instructions in the Interactive Guide, and
submit it. UNMG staff will evaluate your application and email you their decision, which may take up
to 10 weeks. You can check your application's progress via your account profile.
Once you've activated your account, you can subscribe to the UNGM Tender Alert Service, which
automatically emails you notifications of UN tenders that match your company's products. Alerts are
sent as soon as tenders are published, allowing you to act quickly on bidding opportunities. The
subscription fee is $250 annually.
Note that some UN agencies have their own procurement mechanisms and do not use UNGM. You'll
have to register directly with these organizations if you wish to become one of their vendors.
Marketing to UN agencies
Marketing to UN agencies is not unlike marketing to other businesses, government organizations or
multilateral development banks. The key difference is that the UN is a political organization with
almost 200 member states and often deals with projects and requirements in very difficult regions and
situations.
Once you've registered with the UN organizations that are most likely to become your customers, you
should meet with the procurement officers who are in charge of acquiring your specific types of
product. During your discussions, keep in mind that the UN procurement officers who are responsible
for contracting suppliers are not necessarily experts on the products they need to acquire. To provide
this expertise, they usually work with requisition staff, who are responsible for the technical
specifications and the evaluation of the product. When arranging a meeting, try to set it up so you can
present your products to the procurement officers and the requisition staff at the same time.
Another option is to attend UN-sponsored business seminars. Various UN bodies organize these
seminars and you can often find information about them on the agency websites.
If you can't meet with UN procurement staff or attend a UN business seminar, you should send your
company's promotional materials to the appropriate procurement contacts. Note, however, that UN
staff normally won't visit companies to attend product presentations.
The headquarters office of a given UN agency is not your only business prospect. Many of these
headquarters give their country or regional offices the authority to buy products up to a certain
financial limit, which can be as low as $5,000 or as high as $200,000. As a result, any of these suboffices might be a business prospect for your sales team.
While these offices often publish tenders on their own websites and on UNGM, they also work with
their own supplier databases and may not publicize their tender notices globally. You should therefore
contact the country and regional offices of any agencies that may be sales prospects and arrange to
have your company added to their databases.
Procurement documents and competitions
UN agencies use solicitation documents to request "offers" - which can be bids, proposals or
quotations - from their suppliers. There are different types of solicitation documents, depending on
what is required and the total contract value, but all include all the information you'll need to prepare
an offer.
As well as solicitation documents, UN agencies also issue “expressions of interest” (EOIs) to invite
suppliers to provide information about products, resources, qualifications and experience related to a
possible contract opportunity. An EOI may outline a solicitation process for the contract, but it is not
in itself a solicitation document and can be modified or withdrawn at any time.
UN agencies often use EOIs to create short lists of pre-qualified companies for a potential contract
opportunity. If you're interested in participating in the planned solicitation process described in the
EOI, you should respond by briefly outlining your company's expertise and experience as they relate
to the upcoming contract requirements.
The UN uses standard types of solicitation documents, as described below.
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Request for Quotation (RFQ): An informal solicitation, usually issued in order to acquire
standard, readily available products. Awards are made to the lowest-priced, technically
acceptable bidder.
Invitation to Bid (ITB): A formal solicitation that specifies the quantitative and qualitative
requirements of the products as a basis for formal competitive bidding. Awards are made to
the lowest-priced, technically acceptable bidder.
Request for Proposal (RFP): A formal solicitation inviting proposals for a requirement that
cannot be clearly or concisely defined. Price is only one of several factors that determine
which bidder receives the contract.
UN agencies normally use competitions to procure goods and services, as follows:
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Open International Competition (OIC): A competition publicized by an advertisement on
UNGM and elsewhere. It invites all eligible and qualified suppliers to request the bidding
documents and is intended to provide all bidders with an equal opportunity to compete. OICs
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are often used to procure high-value products. If you ask to participate, the agency will send
you pre-qualification documents and, if you meet their criteria, you'll be able to bid.
Limited International Competition (LIC): Available only to a short list of qualified
suppliers that the agency selects according to a variety of criteria. It is used in special
circumstances, such as a situation in which demand is urgent or the supply of the required
products is limited.
Local Competition: The procuring agency, for a variety of reasons, may require that
bidders be located in the country or region where the products will be used.
Direct contracting and long-term agreements may occur as alternatives to competition. Direct
contracting is used under exceptional circumstances, such as a low contract value, a requirement for
standardization or urgent need.
Long-term agreements (LTAs) last for one to five years and are used to consolidate and accelerate the
procurement of frequently purchased products. They are set up using an ITB or RFP process. An LTA
never guarantees a minimum of orders during the period of the agreement, but it does contractually
bind the supplier to deliver certain quantities if asked to do so.
Bidding, evaluation and contract execution
When a UN agency sends you a solicitation document, you should always return an acknowledgement
letter. You should do this even if you don't bid, since the acknowledgement will keep your company
on the active list.
If you decide to submit a bid, follow the bidding document instructions exactly or your bid will almost
certainly be rejected. Other things to keep in mind:
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For many products, the company submitting the lowest-priced, technically acceptable offer
will be awarded the contract.
When you set your price, allow for costs such as a bid/performance bond, changes that might
occur during the bid evaluation time, and logistics expenses.
Separate your technical and financial proposals as instructed in the bid documents. This is
critically important, as the technical proposal is the only document that the initial evaluators
will see. Only when a technical proposal qualifies will the financial proposal be opened.
Once the solicitation deadline has passed, you cannot adjust your bid.
The procuring agency will usually set a date for opening the bids. Try to attend, since you can often
obtain valuable information about your competition during the opening of an RFQ or ITB. At the
opening of an RFP, however, only the company names are read out.
If you are unable to attend, you are allowed to have someone else represent you at the opening. The
Trade Commissioner Service may be able to assist you with this.
After the bids are opened, an agency evaluating committee reviews them to see which one best fulfills
the requirements. Common evaluation criteria include price, cost of ownership, the bidder's
capabilities and experience, compliance with technical requirements and delivery time.
For RFQs and ITBs, the contract is awarded to the bidder with the lowest-priced, technically
acceptable offer. For an RFP, price is only one of several evaluation criteria. After the evaluation of
the technical proposals, the bids that are technically compliant will be subject to a financial evaluation.
The contract is awarded to the bidder with the highest combined scores from the technical and
financial evaluations.
If you are the successful bidder,3 the UN agency will contact you to arrange the contract. There is
usually little room for renegotiating the original offer, but if the agency requests better pricing or
additional discounts, you may be able to get more favourable payment terms in exchange.
The procuring agency may require you to provide performance bonds to guarantee that you will
fulfill all the contract terms. If so, you'll have to provide security in the form of a bank guarantee, a
standby letter of credit or other financial instrument.
In the case of an LTA, the contract will state a not-to-exceed amount. However, this does not
guarantee that the agency will spend up to the limit of that amount. In addition, the agency may allow
other UN organizations to use the LTA for their own procurement. You should ask the procuring
agency to list these organizations in the contract.
Note that if you have an LTA with a specific UN agency, you'll still need to market your products to
its field and country offices, and to any other UN organizations listed in the contract. The existence of
the LTA does not oblige these organizations to purchase the contracted goods from your company.
Executing a UN contract often involves complicated supply chains where things can go wrong. It is
therefore important to maintain good communications with the UN agency staff until the contract is
complete. Note also that agencies will not accept back orders, partial deliveries or partial invoices
unless this is specified in the contract. Suppliers are expected to adhere strictly to the contracted
delivery times and there are penalties for late delivery.
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All currency figures are in USD unless otherwise indicated.
2
For brevity, we'll use "products" as shorthand for "goods and services" from here on.
3
Unsuccessful bidders normally receive a formal letter of regret. If you don't receive this letter or any
feedback about your bid, contact the agency's procuring unit.
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Date Modified:
2014-05-05