You don’t have to be a defence company to sell to the U.S. DoD
If you’re looking to grow your exports to the United States, the U.S. Department of Defense (DoD) is a potential customer. Even if your business isn’t directly involved in the defence sector, this blog will explain what the U.S. DoD buys and how to get started selling to DoD.
Every year, the DoD buys massive volumes of non-military goods such as food, medical equipment and construction supplies. In 2021, it spent a whopping $408.8 billion on contractors of which nearly $900 million went to new contract to Canadian firms.
While many Canadian sales to the DoD are in defence-adjacent areas such as navigation and nautical systems and aircrafts, they also included exports of pharmaceutical manufacturing equipment, travelling cranes, hoists and monorails, fabricated metals, and surgical instruments.
U.S. DoD: A buyer of virtually everything
The scope and breadth of DoD demand stems from the fact that it is the largest department of the U.S. federal government. In fact, it is the largest government employer in the world. The DoD maintains 1.3 million active-duty service members and 950,000 civilian personnel. It’s one of the largest holders of real estate in the world, with a global portfolio of more than 568,000 buildings and structures across nearly 4,800 sites in 160 countries. Its total inventory contains more than five million items.
As a result, the Department has nearly continuous needs for everything from footwear, fasteners and office furniture to software publishing technology and environmental consulting services. It has also demonstrated a growing appetite for artificial intelligence, biotechnology and 5G communications solutions.
What U.S. DoD buys
The DoD buys many things. According to Bloomberg Government, the 2023 projected defense spending by category is as follows:
- Drugs and Pharmaceutical Products– $36.8 billion
- Aircraft– $32 billion
- Systems Development– $25.7 billion
- Facility Related Services– $24.5 billion
- Technical and Engineering Services (non-IT)– $22.9 billion
- Engines, Components & Spt Eq– $22.1 billion
- Management Advisory Services– $21.7 billion
- Ships & Submarines– $20.6 billion
- Construction Related Services– $19.6 billion
- Maintenance, Repair and Overhaul (MRO)– $18.5 billion
This spending profile is a good indication of the opportunities that are available to Canadian suppliers who do not see themselves as suppliers to the defense industry but could be part of the DoD supplier ecosystem.
Selling to the U.S. DoD is a powerful way for Canadian companies of all types and sizes to elevate their business. Learn how to take advantage of this huge opportunity with CCC’s step-by-step guide.
About DoD’s DLA and what they buy
The Defense Logistics Agency (DLA), which manages the global supply chain for the Army, Navy, Air Force, Marine Corps, Space Force, Coast Guard, 11 combatant commands, other federal agencies, and partner and allied nations, supplies 86 percent of the military’s spare parts and nearly 100 percent of fuel and troop support consumables.
Below is the list of the six major subordinate commands responsible for purchasing commodities and services to support the vast needs of the DLA. As you can see, the DLA buys much more than traditional defence equipment and services and they often need Canadian companies to be part of their supplier ecosystem.
DLA Aviation manages the DoD’s aeronautical, digital, hydrographic and topographic map products and operates the federal government’s only industrial plant equipment facility providing a full range of maintenance services for the repair, rebuilding and acquisition of all types of industrial machinery.
DLA Energy manages petroleum products including jet fuels, aviation and automotive gasoline, heating oil and lubricants, as well as coal, natural gas, electricity and alternative fuels. It also supports utilities at DoD installations including electricity, natural gas, water and wastewater systems.
DLA Land and Maritime manages consumable repair parts and depot-level repairable procurement operations for land vehicle operations including maintenance kits, transmission, engine and suspension components, tires and batteries, repair parts for the nation’s ships including electrical parts, valves, pumps, motors and cabling and many consumable hardware items.
DLA Troop Support provides support for humanitarian and disaster relief efforts at home or abroad and provides war fighter support through the purchase of food (subsistence), clothing and textiles, medical equipment and supplies, pharmaceuticals, construction and building supplies.
DLA Disposition Services manages worldwide reutilization, recycling and disposal services including maintenance services for material handling equipment, disposal services; professional services, de-manufacturing services, and precious metals recovery services.
DLA Distribution purchases supplies and services such as packaging materials, conveyor systems and other services to support the DoD distribution network.
Selling products and services to the DLA
As of April 4, 2022, vendors need a SAM Unique Entity Identifier (UEI) to do business with the DLA. Vendors must also have a CAGE code. If you don’t have a CAGE code, you must register your company with the System for Award Management (SAM).
Electronic quoting on the DLA Internet Bid Board System (DIBBS) is mandatory. Solicitations estimated under the Simplified Acquisition Threshold (SAT) of less than $250,000) are available electronically. Solicitations estimated over the SAT (greater than $250,000) can be viewed at Requests for Proposal (RFP)/Invitation for Bids (IFB).
Other DLA Opportunities are available in SAM.gov or through Canada’s Global Bid Opportunity Finder which is available for free for Canadian companies.
Selling innovation to DoD
Beyond standard defence products and services, DoD also engages with Canadian suppliers to nurture, support and buy cutting-edge or innovative technologies. Here is a small sample of some of the resources that the DoD leans on to learn about and purchase innovations.
Defense Innovation Unit
The Defense Innovation Unit is focused on accelerating the adoption of commercial and dual-use technology within the DoD. The agency posts open solicitations where they solicit commercial solutions that address current needs of our DoD partners.
Potential vendors are encouraged to submit a short brief about their solution and the agency will notify you within 30 days if they are learning more.
Defense Innovation Marketplace
The Defense Innovation Marketplace provides a centralized resource for the Department’s Acquisition and Science and Technology professionals on information about industry’s independent research and development (IR&D) activities.
Companies can share their R&D projects to the DoD through the Defense Innovation Marketplace. Information added to the portal is restricted to DoD federal employees or military service members with a direct interest in technology development or S&T (Science & Technology) planning and that have a Common Access Card (CAC). Learn more about the individual project data needed to register your project on the Defense Innovation Marketplace.
The purpose of the U.S. Department of Defense’s Foreign Comparative Testing (FCT) program is to provide a quick and efficient way to test technologies against the U.S. military’s emerging technical requirements.
The program is looking for solutions that can:
- Improve the ability to strike the enemy, across the spectrum from close combat in complex terrain to mobile targets inside adversary air and missile defense networks
- Improve the ability to deploy, survive, operate, maneuver, and regenerate in all domains while under attack, to include active and passive defenses as well as distributed logistics and maintenance technologies
FCT is interested in a broad range of technologies, Artificial Intelligence (AI), biotechnology, quantum science and computing, cyber and 5G.
Canada’s Department of National Defence, in collaboration with Innovation, Science and Economic Development Canada, the Regional Development Agencies, and the CCC, facilitates Canadian industrial participation in the FCT program. If you are a Canadian company and would like to learn more about FCT program, contact the International and Industry Programs Division via email at the Department of National Defence.
More innovation programs
The U.S. DoD offers many more innovation programs for entrepreneurs and non-traditional vendors. CCC is building a few resources for Canadian companies to help them learn more about the DoD Innovation Ecosystem. Contact us to request to be part of our monthly newsletter where we provide updated information on DoD initiatives and programs.
Connect with CCC
CCC has spent decades working closely with the U.S. DoD to connect the American military with Canadian companies to meet their procurement needs. If you’re a Canadian company, contact us to take the first steps toward doing business with the U.S. DoD.
Learn about what makes the U.S. DoD so attractive and what Canadian exporters should know about pursuing opportunities with the U.S. military.
Learn about the U.S. Department of Defense’s Foreign Comparative Testing (FCT) program and how it impacts Canadian businesses.
Let us help you explore ways that the Government of Canada can help you win more international deals.