UNSPSC is an acronym for United Nations Standard Products and Services Code.
The UNSPSC was organized upon the signature of a Memorandum of Understanding signed on September 29, 1998 by John S. Svendsen, the director of the Inter-agency Procurement Services Office (IAPSO) of the United Nations Development Programme (UNDP) and on November 1, 1998 by Lawrence M. Barth, a Vice President of the Dun & Bradstreet Corporation. The development of the first version was overseen by Peter R. Benson, who was also responsible for the design and development of the code management procedure as a modification of the Delphi statistical forecasting method.

UNSPSC is a hierarchical taxonomy that is used to classify products and services related to the diverse needs of businesses and groups involved in buying, selling, analyzing, and regulating goods and services worldwide.

The UNDP appointed GS1 US as code manager in May 2003, since then UNSPSC is managed by GS1. The code manager is responsible for ensuring compliance with the principles of the UNSPSC as well as the integrity of the code schema.

The latest version of the UNSPSC code set is 23.0701 which was released in August 2020.

The PDF format of UNSPSC is free to download, however, the code set in excel format is not free and one has to pay for the same.

The code set can be downloaded through the authorized UNSPSC website: https://www.unspsc.org/

UNSPSC supports more than 17 languages, including English, Arabic, Finnish, Danish, Dutch, French, German, Hungarian, Italian, Japanese, Korean, Norwegian, Portuguese, Spanish, Swedish, Danish, Korean and Chinese.
It is observed that the support of any language in any particular version of UNSPSC varies. Example: Versions v23, v22, v21, supports only English; however V19 supports English, Arabic, Finnish, Korean, Danish and Chinese.

The Standard Industrial Classification (SIC) and the North American Industry Classification System (NAICS) coding systems describe the operations of a business, while the UNSPSC provides a specific product-centric viewpoint by improving purchasing and supply management processes.

Segment is the highest level (Level 1) in the UNSPSC hierarchy and represented by first two digits of the 8-digit code. Each segment is defined in such a way to cover a separate Industry/… Example: Commercial and Military and Private Vehicles, Tools and General Machinery, Manufacturing Components and Supplies, Live Plant and Animal Material and more.
The selection of the right segment is primarily an important step while classifying products/services because all the subsequent lower levels of UNSPSC namely, Family (Level2), Class (Level3) and Commodities (Level 4) are logically related to their respective segments. Wrong selection of segments result in classifying products to a completely different Industry.

The Family forms the second (Level2) in the UNSPSC hierarchy structure and is represented by 3rd and 4th numeric digits in the 8-digit codes. Each family associated with a parent category called Segment.
Family is a drilled version of the segment. All the higher levels of categories of a segment form a family.

44 12 XX XX

Office supplies

43 19 XX XX

Communications Devices and Accessories

The CLASS is the third (level 3) in the UNSPSC hierarchy structure and represented by 5th and 6th digit in the 8-digit UNSPSC code set. Each CLASS is associated with a parent Family and Segment.
The CLASS categories are defined by logical grouping of similar Product/Service group names.
Example:

44 12 XX XX

Office supplies

44 12 17 XX

Writing instruments

43 19 XX XX

Communications Devices and Accessories

43 19 15 XX

Personal communication devices

The Segment is the fourth (level 4) in the UNSPSC hierarchy structure and represented by 7th and 8th digit in the 8-digit UNSPSC code set. Each Segment is associated with a parent Family, Class and Segment.
The Segment defines type of product/service that comes under the associated class.
Example:

44 12 XX XX

Office supplies

44 12 17 XX

Writing instruments

44 12 17 01

Rollerball pens

43 19 XX XX

Communications Devices and Accessories

43 19 15 XX

Personal communication devices

43 19 15 01

Mobile phones

Taxonomy is a hierarchal representation of products/services. The hierarchy levels may vary depending on the Product and its type, Standard/Custom Taxonomies. Example: Televisions are represented in the following taxonomy.

Consumer electronics

Audio and visual equipment

Televisions

There are organization which provides ready to use hierarchal structural for representation of Product/Services.
Examples: UNSPSC, ECLASS, CPV, and more.

Following are the few major advantages of using Standard taxonomy.

• Easy, quick and readily available to use.
• Open-source standards, communication across the system and Data mapping are easy.
• As it is open source, easy to find the experts.
• Lot of information/PPT/blogs available to get to clarify for any clarifications.
• New updated versions are release regularly. So, updated taxonomy is always available.
• Quality of the Taxonomy is assured up to a defined standard.

Following are the major Limitations of usage of Standard Taxonomy.

• More Generic and designed to cover complete universal products/services.
• More detailed products types are not be available. Example: Types of Ball bearings are not listed in UNSPSC.
• New updated versions are released continuously and needs to be updated.
• May not be able to differentiate from competitors as its open source available for everyone.
• Cost of implementation of new system.

No. from taxonomy, we can only define/identify/classify up to Products and its type. The particular product within its type can’t be identified.

Spend taxonomy is the classification of an organization's business expenditure in a hierarchical order. The hierarchy levels vary depending on the complexity of the spent products/services. Generally it ranges from 3 to 4 levels.

The UNSPSC is the most widely used taxonomy for spend data classification.