Goods and Services

In Canadian federal procurement, goods and services means the items and work the government buys to support its programs, operations and the delivery of public functions. The Government of Canada describes government procurement as the purchase of goods, services and construction services, ranging from office supplies to the materials and services used in major infrastructure projects.

The term is a standard procurement category, not an abbreviation. The Supply Manual glossary on CanadaBuys defines procurement as the process of obtaining goods and services, including requirements definition, acquisition, contracting, delivery follow-up, payment and contract close-out.

How federal sources separate goods from services

The Office of the Procurement Ombudsman describes goods as articles, commodities, equipment, materials or supplies. For its research, a service is whatever is not a good. That simple split is useful: if a requirement is not a physical article, it is treated as a service.

Construction sits alongside goods and services as its own category. Federal procurement policy applies to acquisitions of goods, services and construction, and reporting generally treats construction separately from the other two.

• Goods: articles, commodities, equipment, materials or supplies.
• Services: requirements that are not goods.
• Construction: a related but separate category in policy and reporting.

Who buys goods and services for the federal government

Public Services and Procurement Canada (PSPC) is the federal government's central purchasing agent and common service provider for more than 100 departments and agencies. It procures a broad range of goods and services, including defence-related requirements.

Under the Department of Public Works and Government Services Act, the Minister of Public Services and Procurement has statutory responsibility for federal procurement of goods and a role in the procurement of services.

Dollar thresholds for goods versus services

Federal thresholds treat goods and services differently. PSPC guidance identifies purchases below $25,000 for goods and $40,000 for services and construction, including applicable taxes, as low-dollar-value procurements. Procurements above those amounts are generally conducted through the solicitation of bids or quotations.

The policy framework behind these categories aims to obtain the assets and services needed to support government programs while achieving best value for the Crown.

Rules that apply to both goods and services

The federal Code of Conduct for Procurement governs the acquisition of goods and services and requires procurement activities to be conducted in an open, fair and transparent manner.

Green procurement also applies to both categories. It covers the purchase of environmentally preferable goods or services, meaning those with a reduced life-cycle environmental impact compared with competing goods or services that serve the same purpose.

What it means for a supplier bidding on Canadian public contracts

The solicitation states whether the requirement is for goods, services or both. Read that statement first, because it shapes the thresholds, the evaluation approach and the delivery or performance terms that apply to your bid. Respond to the stated requirements and comply with the evaluation, delivery or performance terms set out in the solicitation.

Bidders should also understand the full procurement cycle. It runs from bid solicitation through contract award, contract administration, delivery follow-up and payment, so obligations continue after the award. Suppliers of goods and suppliers of services both work within the same Code of Conduct and the same open, fair and transparent expectations.