7-2.5 Finalization and Benefits of Category Strategy Development

The various requirements of the commodity, logistics support options, value and risk of the commodity, and the marketplace allow for the actual development of a strategy that incorporates business considerations and impedes risk. An effective commodity strategy identifies priorities and key areas surrounding the purchase, such as:

• Costs incurred and pricing.
• End results and delivery on commitment.
• Innovation and improvement.
• Distribution, storage, and transportation methodologies.
• eBuy availability (e.g., the availability of a commodity on eBuy, electronic data interchange [EDI] compliance of the existing supplier pool).
• Information management.
• Operational efficiency and systems management.
• Necessary skill sets.

An effective commodity strategy also has the following benefits:

• Identification of Postal Service core competencies, capabilities, and capacities.
• Increased negotiation power (information that can be leveraged).
• Reduced time-to-market cycle times for new products and services as a result of expanded organizational flexibility and alignment.
• Increased agility in addressing the market and technological trends⁄changes.
• Increased client satisfaction with reduced response times and costs.
• Reduced operating expenses.
• Reduced transactional costs.
• Enhanced product and service quality.
• Elimination of unidentified risks and proactive risk management.