November 8, 2013 (Report Number MS-AR-14-001)

During a recent audit, the U.S. Postal Service Office of Inspector General (OIG) found that significant improvements to the Postal Service’s internal stamp ordering and fulfillment processes are needed. The audit was initiated because of concerns that postal retail units (PRUs) were running low on or out of stamps to sell to the public.

The Postal Service has two methods for processing postage stamp orders. One method uses stamp distribution centers (SDCs), which process about 4,500 requests each day from retail units. The other method uses Stamp Fulfillment Services, which processes over 10,000 orders a day from collectors, businesses, and residential customers requesting stamps, philatelic memorabilia, and retail products. Stamp Fulfillment Services receives and fulfills orders from individual purchasers, large volume customers, international agents, and subscription customers. It also answers requests for cancellation services for philatelists and philatelic dealers.

Between November 2012 and March 2013, PRUs experienced delays of more than 14 days for receipt of stamp orders. This resulted in shortages of specific commemorative and various other stamps available for sale. In addition, SDC stock was depleted on six separate occasions. This led to back orders and delayed fulfillment from March to June 2013 and notable shortages of popular commemorative and special issue stamps.

Stamp stock shortages and delays resulted from implementation of the Solution for Enterprise Asset Management (SEAM) system, which was inadequately tested prior to deployment. The problems were exacerbated because deployment occurred during the 2012 holiday season, prior to a rate change, and during a time when thousands of postmasters were retiring. Management did not effectively communicate with personnel responsible for ordering and fulfilling stamp stock. As a result, the Postal Service’s ability to accurately assess existing stamp stock inventory and increase stock visibility was limited. The OIG identified $120 million as revenue at risk related to stamp stock transactions not being recorded timely.

The Postal Service has made technical and operational improvements to SEAM. As it develops and enhances systems and integrations, the Postal Service will ensure that it takes into consideration lessons learned from the SEAM implementation and apply those lessons to the new stamp ordering and fulfillment processes. The processes are scheduled for deployment in fiscal year 2015.

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Comments (2)

  • anon

    I have over 39 years of Postal Management experience. As A Philatelist, I am deeply devoted to this craft with a strong belief in the history and the unique personality of this of significant stamps art. With your kind permission, would like to join and work the stamps department of the USPS. Regards Abraham

    Aug 08, 2017
  • anon

    I would like to purchase several sheets of the John H. Johnson postage stamp. Please advise.

    Jul 12, 2016