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Supplying Principles and Practices > USPS Supplying Practices Process Process Step 5: Measure and Manage Supply > Conduct Material Planning Activities
Conduct Material Planning Activities
Material refers to all supplies, equipment, and repair parts owned by the
Postal Service. Material planning encompasses and incorporates the
arrangements and preparations essential to logistics and the processes
associated with logistics. These activities span from receipt of the material
until disposal.
Conducting material planning accomplishes the Postal Service objective of
providing quality material responsively and cost-effectively. The information
garnered during material planning activities feeds into the Develop, Finalize,
and Implement Inventory Control Plan and the Implement Life Cycle Support
Plan topics of the Manage Demand task of Process Step 5: Measure and
Manage Supply.
The Item Manager is responsible for conducting material planning activities,
with the support of the Client, Contracting Officer, and Supplier. Conducting
material planning activities involves:
• Characterizing the material
• Material logistics
The Item Manager and Client must ensure that the material type is
appropriately classified. The material type plays a role in activities from
processing to authorizations. Material types include:
• Capital - has a service life of more than one year, is identified as
a stand-alone item of property throughout its useful life, has a unit
cost of $3,000 or more, and depreciates in value
• Expendable - items that cost less than $3,000; repair parts and
replacement components (e.g., batteries, motors), regardless of
cost; and, for the most part, mail transport equipment (MTE),
neighborhood delivery and collection box units (NDCBUs),
workroom furniture, and similar items
• Sensitive - materials considered especially vulnerable to theft or
loss (e.g., computers, cameras, valuable portable equipment)
The Supplier and Client communicate the material's factors to the Item
Manager. These must be defined because they influence the receipt, storage,
distribution, and recovery of the material. Material factors include:
• Nature of the material (e.g., shelf life)
• Size, weight, and shape
• Turnover
• Quantity
The following areas will be incorporated into planning activities, if applicable
to the material:
• Schedule - key delivery dates of the material (leads to
appropriately allocating and positioning inventory and assets; the
schedule information will be supplied by the Client and Supplier)
• Technology - the current systems for tracking, handling,
distributing, and managing the material (e.g., manual and
automated systems such as the electronic Maintenance Activity
and Reporting System(eMARS) and the Vehicle Maintenance
Accounting System (VMAS)
• Environmental/Hazardous Waste - all applicable regulations
regarding safety, control, and disposal of hazardous materials
(e.g., the storage/disposal of hazardous/regulated materials
needs to be organized and controlled)
• Security/Sensitivity Issues - will affect receipt, storage, and
distribution of materials, if not resolved
• Other material planning activities (e.g., forecasting demand to
bring supply and demand into convergence, adjusting for peak
demand periods, and continually examining usage and quality
trends of materials)
Material Logistics are directly influenced by the characteristics of the material.
Once these characteristics are identified, the logistics of the material can be
planned. Relative characteristics include:
• Receiving - incoming material packaging or transportation
requirements can be defined (additional information can be found
in the Receipt and Inspection topic of the Complete Delivery task
of Process Step 4: Deliver and Receive Requirements)
• Custody/safeguarding - custody is the immediate charge and
control exercised by a person over Postal Service material; all
Postal Service employees are responsible for safeguarding
materials in their custody
• Material storage - for example, stocking and replenishment
decisions (Develop, Finalize, and Implement Inventory Control
Plan topic of the Manage Demand task of Process Step 5:
Measure and Manage Supply), positioning stock, or issuing stock
• Administration - record keeping (e.g., Expendable Property
Transaction files, Pending Verification files, and subcustody
records) and reporting (e.g., reporting excess material that is
identified as over and above the foreseeable needs of the Postal
Service facility or organization accountable for them and is
serviceable and readily available for redistribution)
• Distribution - process by which material is processed, handled,
and moved within the Supply Management Operations system to
clients (e.g., the mode of transportation needed to ship material
from a warehouse)
• Investment recovery - the effective end-of-life decision is
addressed by the following methods: recycle, reallocate, resell,
remarket, return, remanufacture, and remove (Develop
Preliminary Investment Recovery Plan topic of the Develop
Sourcing Strategy task of Process Step 2: Evaluate Sources;
Finalize Investment Recovery Plan topic of the Plan for Contract
Management task of Process Step 3: Select Suppliers;
Implement Investment Recovery Plan topic of the Manage
Demand task of Process Step 5: Measure and Manage Supply)
• Disposal - the final removal of the product and the finalizing
action of end of life (Dispose topic of the Implement Investment
Recovery Plan task of Process Step 6: End of Life)
A quadrant approach classifies Postal Service purchases into four categories,
depending on their impact on the Postal Service core competencies (noncore
versus core) and complexities (standard versus custom). Depending on the
quadrant, material planning activities will focus on different areas of unique
planning activities and material logistics, as illustrated in Figure 5.4.
Figure 5.4
Quadrant Approach
There are few options, one or restricted supplier sources, and supply
continuity is imperative for materials. Planning activities surrounding the
materials schedule, such as key delivery dates and close contact with
suppliers, will need to be conducted for materials in this quadrant.
Materials are vital to operations, are of high value, and there are few sources.
The logistical areas of custody/safeguarding and material storage are of great
importance and must be addressed by the material planning activities.
Many options and sources for materials, coupled with minimal brand
preference, can lead to reduced purchase efforts and associated costs.
Actions that can be taken are automation and reducing administrative costs
(i.e., reporting and recording).
Materials have many alternatives, many sources, and are readily available in
the marketplace. Particular attention should be given to recovery because
surplus in this quadrant is addressed as bringing in the highest dollar value,
being greatest in inventory quantity, and offering easy logistics.
Develop Preliminary Investment Recovery Plan topic, Develop Sourcing
Strategy task, Process Step 2: Evaluate Sources
Finalize Investment Recovery Plan topic, Plan for Contract Management
task, Process Step 3: Select Suppliers
Receipt and Inspection topic, Complete Delivery task, Process Step 4:
Deliver and Receive Requirements
Develop, Finalize, and Implement Inventory Control Plan topic, Manage
Demand task, Process Step 5: Measure and Manage Supply
Implement Investment Recovery Plan topic, Manage Demand task, Process
Step 5: Measure and Manage Supply
Dispose topic, Investment Recovery task, Process Step 6: End of Life
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