Effective ways to sell to the United Nations
Cooperation with the UN – business opportunities for Finns
The United Nations (UN) buys $25-30 billion worth of goods and services annually, providing one option for the global market. Cooperation with the UN guarantees Finnish companies and organisations excellent opportunities to diversify their own customer base and at the same time increase their knowledge of emerging markets. Through UN procurement, you can also be involved in building a world that complies with the Sustainable Development Goals.
UN procurement in 2023: Health, construction and food sectors at the top
To whom
The UN's Annual Statistical Report (ASR) provides a comprehensive overview of its annual procurements. According to 2023 data, 32 UN organisations accounted for 99% of all UN procurement.
Key procurement sectors (2023):
- Health: $4.8 billion
- Construction, Engineering, and Science: $3.5 billion
- Food and Agriculture: USD 2.7 billion
The three largest procurers (2023):
- UNICEF (United Nations Children's Fund): $5.2 billion
- WFP (World Food Program): 4.5 billion USD
- UN Secretariat (The administrative arm of the United Nations): USD 2.9 billion
The UN is a reliable partner that can provide financial stability to suppliers of services and goods. It values long-term cooperation with companies of all sizes. Many UN organisations encourage Finns with competitive innovations in areas such as clean energy, health, water and digitalisation to contact them directly.
In order for a company to succeed in this market, its finances must be in order. Experience in exports, especially from emerging markets, is a great advantage. In addition, the company must have its own resources reserved for UN procurements that are able to focus on this work. If a company is able to offer turnkey solutions, products or services in specialties where competition is low, or if it already has good and effective partnerships in a local emerging market, it increases credibility for the UN.
The UN as a customer
The UN is a network-like actor consisting of about a hundred organisations, agencies, programmes and funds. It strives to be transparent and equal in all its operations. This is also reflected in its procurement processes, which are carried out through open tenders through the UN's own portal, the United Nations Global Marketplace (UNGM).
Each UN organization has its own procurement practices, which leads to different requirements for products and services. These differences are due to the goals and operating principles of the organizations. The UN can make purchases through its headquarters, country offices and service centres. The aim of the procurements is to obtain the necessary resources quickly, following the following principles:
- Best value for money: Looking for the most affordable deals.
- Accountability, honesty and transparency: Transparency and ethical operations are ensured.
- Fair and effective competition: Fair and competitive procurement processes are maintained.
- Interests of UN organisations: Prioritise the needs and goals of UN organisations.
For the UN, selling can sometimes feel challenging. However, it offers interesting business opportunities that are worth exploring. The UN makes procurements according to different categories (Procurement Categories) and uses UNSPSC (United Nations Standard Products and Services Code) codes in the classification of products and services. These codes provide a uniform classification system and help the UN manage its procurement efficiently and more accurately. Here are the categories that can be used to find out if there is a demand for the company's own products and services:
Main categories of procurement, list in English
Audio and Visual Devices
Emergency Preparedness Kits
Healthcare Services
Personal Hygiene and Sanitation Products
Telecommunications
Building and Maintenance Services
Engineering, Research and Technology Based Services
Insurance Services
Pharmaceuticals Items
Translation and Publishing
Business Professionals and Administrative
Food and Beverages
IT Services
Postal, Courier and Mail Services
Transportation and Storage
Computer Hardware and Software
Fuels, Additives and Lubricants
Medical Equipment and Supplies
Public Order, Security and Safety
Travel Management
Electoral Systems
Graphic Design
Medical Waste Disposal
Specialized Equipment for Agriculture
Vehicles and Fleet Management
United Nations Global Marketplace (UNGM)
The UN wants to act transparently and impartially. In practice, this means that the UN publishes almost all calls for tenders in its own procurement portal (UNGM). The UN's most procuring organisations, of which there are more than 30, consider this portal to be the primary channel for publishing their open calls for tenders. Before suppliers of goods or services can cooperate with the UN, they must register on a portal through which UN personnel can find them. Your own visibility here is important, especially when the UN is looking for the most potential sellers. Anyone selling to the UN or planning to become a seller should actively visit the UNGM portal to go through both open tenders (Procurement Opportunities) and contracts already made with the UN and various suppliers (Contract Awards).
It is worth examining the agreements that have been made more closely, because they contain information on, for example, who has won the contract and what the contract amount is. Through this, you can also contact the person responsible for the UN convention and ask for more information on the matter. In addition, these published agreements may help to identify opportunities to be involved in subcontracting networks, especially when direct sales to the UN are challenging.
Several UN organisations use various eProcurement portals, which they can utilise either as stand-alone solutions or integrated with the UNGM portal. These electronic systems make the procurement process more efficient by digitally managing the stages related to the different forms of UN procurement. They help with the processes of opening and formally reviewing tenders submitted by suppliers. Electronic systems are also used when tenders received from suppliers are compared or when a decision is made to award a contract.
The UN Procurement Portal (UNGM) contains a lot of useful information in addition to open tenders and concluded contracts. Here are two key links that you should take a closer look at:
- The Knowledge Centre (ungm.org) provides information on the UN market, procurement tools and e-learning courses.
- The UNGM Help Center provides practical tips on how to register for the UN Procurement Portal, but also provides more information about procurement.
UN cooperation requires expertise in procurement methods
The United Nations operates in highly demanding and challenging conditions around the world, while providing businesses with access to global markets. However, it is only one of many markets where you need to learn the UN's procurement methods in order to succeed. Below are a few key points:
1. UN procurement modalities
The word "solicitation", which is used in connection with UN procurement, refers to various forms of procurement by which UN organisations communicate their procurement requirements. Typically, the value of the procurement, its importance, and the delivery time are critical factors in the choice of format. Procurement formats include requesting quotations, price requests, or proposals from potential suppliers. Even if the supplier of the goods or services cannot participate in a procurement call submitted by the UN, it is important to always respond and indicate whether they will participate or not. This shows professionalism and ensures that the UN organization can continue its procurement process efficiently. The UN's main procurement modalities are:
1. Request for EOI (Expression of Interest)
Suppliers are asked to provide information on products, services, resources and prerequisites, which allows the UN to identify the most potential suppliers.
2. Request for Quotation (RFQ)
A free-form sourcing method for products and services that are readily available on the market and have a low value, such as less than $30,000 USD.
3. Invitation to Bid (ITB)
An official form of procurement for clearly defined goods and services, where the award of the contract is based on the most advantageous accepted tender, for example, a value greater than USD 30,000.
4. Request for Proposal (RFP)
A form of procurement in which both the price and the technical solution contribute to the award of the contract, for example, a value of more than USD 30,000.
5. Long-Term Agreement (LTA)
A contract based on an ITB and an RFP (2-5 years), in which case no new tenders are usually published for the product or service in question during the term of the contract.
6. Direct Contracting
Direct procurement can be used, for example, in humanitarian crises.
1. Joint Sourcing and Piggybacking
In Collaborating Procurement, several UN organisations join forces with the aim of achieving cost savings or improving services by reducing overlapping activities between UN organisations. Through this kind of cooperation, the UN harmonises and streamlines its procurements.
An example of joint procurement is the cooperation between the United Nations Population Fund (UNFPA), the United Nations Children's Fund (UNICEF) and the United Nations High Commissioner for Refugees (UNHCR). In response to the lack of globally standardized quality standards for menstrual products, these UN actors developed them together.
Learn more
When a company has a long-term agreement (LTA) with one UN organization, others can use the same agreement. This practice is known as Piggybacking or UN-to-UN procurement and is used by a number of UN organizations, allowing them to benefit from an existing contract without starting a new bidding process. This will also give journalists more visibility and make it easier for them to sell to the UN.
Both Collaborating Procurement and Piggybacking aim to improve the UN's procurement processes. When Piggybacking utilizes existing contracts to increase efficiency, joint procurement requires cooperation between different actors from the beginning to achieve common procurement goals.
Key considerations in UN procurement processes
The following things should be taken into account in UN procurement:
Length and challenge of processes: Procurement processes can be long, while RFQs often take short response times. The UN may extend the tendering process several times and change the specifications of the product or service to be procured for various reasons. The more challenging and complex the procurement, the more likely it is to change. The procurement process can take anywhere from a few months to up to a year.
Recurring changes: The complexity of the project, the number of vendors, the monetary value, and the organization's internal procedures affect the schedule. Location and urgency may also affect the choice of procurement method.
Local partnerships: Goods and equipment are often purchased together with installation and maintenance, which requires a local partner in the destination country.
Long-Term Agreement (LTA): Participating in individual tenders can sometimes be financially burdensome, which highlights the importance of long-term agreements with the UN.
Sustainability and the SDGs: Emphasizing sustainability provides a competitive advantage. Suppliers who have it as part of the company's strategy are in a good competitive position. On the other hand, cooperation between UN organisations on issues related to sustainable development can also benefit a company's business with other stakeholders and markets.
Centralised resources for UN work: Good preparation in advance, for example with the help of a person hired by the company who is responsible for UN procurement, gives a strong advantage.
Alternative types of agreements with the UN
- A supplier can enter into a traditional fixed-term one-off contract for the supply of certain goods and services at an agreed price.
- The supplier can enter into a long-term contract, which is a framework agreement. It does not specify the amount of goods and services and is concerned with the needs of one UN organization over a period of time, which is usually between 2 and 5 years.
- It is also possible to enter into a non-commercial partnership with the UN, based on pro bono activities.
The UN assessed the bids as follows
- Acceptance of the UN Payment Terms and Conditions
- Technical requirements
- Delivery terms and time
- Delivery based on international standards
- Provision of supporting documents, including any references
- Proven production capacity and financial stability
- Price
Checklist for maximizing your own sourcing opportunities
Participating in the UN procurement process can be both rewarding and challenging for suppliers. It is very important to understand how different UN organizations make their purchases. The checklist below helps aspiring journalists to become a reliable UN partner.