About commodity codes
Commodity codes are used to categorize products and services that buyers purchase through a sourcing event. A buyer can assign a commodity code to an item and use that code to track spending patterns within the buying organization. When a commodity code is assigned to an item, the commodity code information follows the item through Strategic Sourcing and back into the Purchase Order application.
Commodity codes are also used by suppliers to indicate the type of event notifications they receive. When a supplier registers through the Supplier Portal, they can specify one or more commodity codes that they want to be notified of. When a new event is released that contains one of the commodity codes, the supplier is notified by e-mail.
Commodity code structures
Commodity code structures are defined in Strategic Sourcing and assigned to an item group on Item Group (IC00.1) in the Inventory Control application. Individual commodity codes from the structure can then be assigned to items in the item group on Item Master (IC11.1).
Examples of commonly used commodity code structures include NIGP (National Institute of Governmental Purchasing) and UNSPSC (United Nations Standard Products and Services Code). You can create a different commodity code structure or import records that already use a defined structure (such as NIGP or UNSPSC).
Commodity code structures have a defined number of levels that can be used to create a code. The following is a example of a three-level commodity code structure.
| Commodity Code | Description |
| 01 | Office Supplies |
| 01-01 | Pens |
| 01-01-01 | Highlighter Pens |
| 01-01-02 | Ballpoint Pens |
| 01-02 | Pencils |
| 01-02-01 | Mechanical Pencils |
| 01-02-02 | Colored Pencils |