Management of Suppliers’ Contractual Performance
The U.S. Postal Service has essential business relationships with its suppliers to perform many functions that closely support Postal Service operations. The Postal Service aims to build and maintain these relationships based on the potential impact suppliers’ performance has on the Postal Service’s operational and financial position. From fiscal years (FY) 2019 to 2021, the Postal Service’s managed spend for goods and services was about $17 billion on contracts distributed throughout ten Supply Management Category Management Centers and four Portfolios.
What We Did
Our objective was to determine if the Postal Service evaluates and manages risks associated with suppliers’ performance to fulfill contractual requirements successfully. We reviewed a judgmental sample of 94 Postal Service suppliers with a managed spend of $1 million and above per contract from FYs 2019 to 2021.
What We Found
Supply Management uses specific policies and procedures, contract clauses, metrics, market trends, and past performance to evaluate and manage risks associated with supplier performance. However, we found areas where contracting professionals can improve application of their policies and procedures for managing contracts. Additionally, contracting officers did not always include required, accurate, or complete information in the contract files to support contract management decisions.