3-7.2 Final Removal Decision

The final removal decision determines how to eliminate surplus materials at the conclusion of the asset’s useful life. These surplus materials can be removed through any of the following methods:

3-7.2.1 Recycle

Recycling is the process of both obtaining a market value for materials that can be reused in the manufacturing process and reducing the environmental impact of the material used by the Postal Service. Recycling on many items is mandated by Federal, regional, state, or local governments and failure to comply can lead to financial and social impacts on the Postal Service. The purchase/SCM team must be aware of these potential impacts and, in cooperation with Assigned counsel, advise the client on appropriate actions. The supplier is often very aware of the status of any material restrictions and can help in the mitigation of risk. Advice is also available to the purchase/SCM team from the Asset Management investment recovery team.

3-7.2.2 Reallocate (Relocate and Redeploy)

Reallocation of identified surplus is the actual relocation and redeployment of a material. Reallocation puts the material to work as part of its lifespan and avoids the cost of purchasing. Although a material may no longer fulfill the purpose for which it was purchased, it still can fulfill other purposes pertinent to the Postal Service. The purchase/SCM team will determine when and where specific materials are fruitful for more than one project or use and convey this information to the client. For reallocation to become a successful reality, the purchase/SCM team must communicate closely with any potentially concerned parties.

3-7.2.3 Resell

Resale of surplus materials is the financial transaction of selling a material on the open market. Resale generates revenue that improves short-term cash flow and reduces the TCO. Potential revenue will be determined through market research. Resale is also appropriate for the Consider Auctions topic of the Develop Sourcing Strategy task of Postal Service Supplying Practices Process Step 2: Evaluate Sources; specifically in this case, a forward auction. Some materials require special handling before resale:

3-7.2.4 Remarket (Resell to Supplier)

Remarketing is the selling of a surplus material back to the supplier. Suppliers frequently buy back used equipment to protect proprietary technology and prevent competition from being able to sell identical material (e.g., automation). Potential revenue realized by remarketing will be compared with potential revenue realized by reselling, and after a price analysis has been conducted, the results will be communicated to the client, and a plan will be selected.

3-7.2.5 Return

Returning identified surplus is a nonfinancial transaction of providing surplus material (e.g., delivery and industrial equipment) to the supplier for a credit.

3-7.2.6 Remanufacture

Remanufacturing identified surplus is the use of components of a material alone or combined with others to create a new material or product (e.g., mail transportation equipment and spare parts). Because manufacturing is not a core competency of the Postal Service, remanufacture may be a rare solution for the disposal of surplus and idle assets. Remanufacture would be appropriate when an internal Postal Service project that has decided to make a product has been identified by the purchase/SCM team and these surplus or idle assets can be leveraged to reduce the costs associated with the new product or service.

3-7.2.7 Remove

Removal is the last-resort process of disposing of surplus material, and comes into play when the Postal Service must pay for the physical removal and disposition. However, as the need for recycling increases and the technology for sorting recoverable material improves for such things as mixed scrap metal, removal costs may decline. The supplier or the Asset Management investment recovery team may be able to identify opportunities other than paying for removal.

3-7.2.8 Donate

If material can not be reused within the Postal Service or sold as a revenue offset to the TCO, it may be donated to Federal, state, or local governments or charitable organizations chartered by these governments, in that sequence. Antiques and collectibles must have the prior approval of the Postal Service Historian before donation.