Letters of Interest (LOI)

Letters of Interest (LOI) represent an informal pre-solicitation approach where government departments test the waters before committing to a full procurement process. While you won't find "Letters of Interest" explicitly defined in the Government of Canada Supply Manual, the practice exists in various forms across federal procurement—particularly when departments need to understand if there's sufficient supplier capability before investing resources in a formal solicitation.

How It Works

Here's the thing: the federal government uses several mechanisms to gauge market interest before launching formal procurements, though they don't always call them LOIs. The Supply Manual Chapter 6 on Developing the Procurement Strategy emphasizes the importance of market research during requirement definition, but stops short of prescribing a standardized LOI process.

In practice, what departments often use is the List of Interested Suppliers (LIS) functionality on CanadaBuys. When a department posts an advance notice or Request for Information, suppliers can join the LIS to signal their interest. This serves a similar function—the department gets visibility into who's watching, and suppliers get added to distribution lists for future related opportunities. The approach varies considerably by department and procurement complexity. PSPC might handle this one way, DND another, Shared Services Canada yet another.

The formal invitation process matters more than you might expect. According to Canada's solution-based supply arrangement guidelines, suppliers cannot submit bids unless invited. But uninvited suppliers who hold standing arrangement status can request an invitation—they just need to do it at least 5 days before the closing date. This creates a semi-permeable boundary where expressions of interest carry actual procedural weight.

Key Considerations

• No standardized format: Unlike RFPs or RFQs, there's no government-wide template or mandatory process for LOIs. Each department may handle pre-solicitation outreach differently, making it essential to monitor individual contracting authorities.

• Timing matters for invitations: If you're responding to what amounts to an expression of interest, remember that formal bidding windows have strict minimums. Five calendar days for procurements below CETA thresholds. Fifteen days up to $3.75 million. Twenty days for higher-value opportunities. Don't confuse an informal LOI period with these mandatory timelines.

• Strategic vs. obligatory: Departments use market engagement strategically during procurement strategy development, but they're not required to issue LOIs or similar calls before every procurement. Some opportunities appear as full solicitations without any advance testing of interest. No warning at all.

• Provincial differences: While this article focuses on federal procurement, provincial and municipal jurisdictions may have more formalized LOI processes. Don't assume practices transfer across government levels.

Related Terms

Request for Information (RFI), List of Interested Suppliers (LIS), Advance Contract Award Notice (ACAN), Market Engagement, Pre-Solicitation

Sources

• Supply Manual Chapter 6 - Developing the Procurement Strategy, Government of Canada

• Solution-based supply arrangement, Canada.ca

• Government of Canada Supply Manual, CanadaBuys

If you're relying on informal expressions of interest to position your firm, make sure you're also registered on CanadaBuys and monitoring advance notices. The real game often happens in those early market research phases—before most suppliers even know an opportunity exists.