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As discussed in Section 2-19, Consider Use of Renewals and Options, the purchase⁄SCM team should consider whether a particular contract should include clauses that will allow the Postal Service to renew a contract or exercise options to purchase additional items or services, once the original term of the contract has expired. The renewal of a contract or the exercise of a contractual option takes place when the purchase⁄SCM team decides that a need is continuing and that maintaining the current supplier’s performance would represent the best value to the Postal Service.
Contracts cannot be renewed and options cannot be exercised unless the current contract contains either Clause B-78: Renewal or the relevant clauses discussed in Section 2-19, Consider Use of Renewals and Options. A contract is renewed via modification and the mutual agreement of the Postal Service and the supplier; contractual options can be exercised unilaterally by the Postal Service or following discussions and negotiations, depending on the clauses in the contract. The renewal of certain mail transportation contracts must follow specific procedures, and these are contained in the commodity-specific business practices.
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