Federal Acquisition Service U.S. General Services Administration 2012 Government Transportation Forum February 19-20, 2013 Federal Strategic Sourcing Initiative Second Generation Domestic Delivery Services (DDS2)

"Leveraging spending via governmentwide strategic sourcing for Domestic Delivery Services" Page 1  DDS2 History, Update and Insights – Stevie Graham, GSA Agenda

Page 2 What is Strategic Sourcing? “Strategic sourcing is the collaborative and structured process of critically analyzing an organization’s spending and using this information to make business decisions about acquiring commodities and services more effectively and efficiently” Clay Johnson Former Deputy Director for Management, OMB Definition of Strategic Sourcing

Page 3 "Leveraging spending via governmentwide strategic sourcing for Domestic Delivery Services

Page 4 The DDS2 program is the result of a year-long collaboration between dozens of government experts TECHNICAL EVALUATION TEAM Diane Kanauka, IRS Bill Bardwell, VA Ernie Stevens, GSA REQUIREMENTS DEFINITION & ACQUISITION STRATEGY TEAM CONTRACTING OFFICER Jason Holloway, GSA Kesa Russell, DHHS Steve Schneider, DHHS-NIH Valerie Hood, DHHS-NIH Kathryn Calderone, DHS Acia (John) Parker, DHS-USCG Gerri Tzul, DOC Al Majors, DOE Anthony Nellums, DOE Tim Jackson, DOE Sondra White, DOI Romerio Moreno, DOL Becky Koses, GSA Blaine Jacobs, GSA Ed Kelliher, GSA Ernie Stevens, GSA John Blanchard, GSA Kristina Nelson, GSA Lynn Ju, GSA Marquita Washington, GSA Mary Anne Sykes, GSA Mary Davie, GSA Michel Kareis, GSA Tauna Delmonico, GSA Valerie Bagby, GSA Tim Burke, GSA Ames Owens, DOT Steve Hopkins, DOT- FAA James Burns, DOT- FMCSA Brian Dennis, NTSB Jack Kelly, OMB Rosalind Wright, OPM Brenda Jackson, Treasury-IRS Diane Kanuka, Treasury-IRS Christin Lawlor, USDA Todd Repass, USDA Victor Jefferson, USDA Bill Bardwell, VA Nelson Gonzalez, VA

Page 5 DDS2  UPS Oct 2009 – Sep four options  Over $1B savings forecasted  Lower discounted common accessorials  Continue with no FSCs for parcels  Monthly enhanced shipping reports  Over 167 participating customers  58% ground shipmentsDDS2  UPS Oct 2009 – Sep four options  Over $1B savings forecasted  Lower discounted common accessorials  Continue with no FSCs for parcels  Monthly enhanced shipping reports  Over 167 participating customers  58% ground shipments DDS1  FedEx Oct 2006 – Sep 2010  Over $676M savings  Discounted accessorials  No fuel surcharges (FSCs)  Quarterly shipping reports  61 participating customers  40% ground shipmentsDDS1  FedEx Oct 2006 – Sep 2010  Over $676M savings  Discounted accessorials  No fuel surcharges (FSCs)  Quarterly shipping reports  61 participating customers  40% ground shipments "Leveraging spending via governmentwide strategic sourcing for Domestic Delivery Services" DDS1 to DDS2

Multiple Award Schedule Contract Vendors  United Parcel Service  Federal Express Service  United Postal Service  Cortrans Logistics  Panther Transportation  Airnet Systems  Team Air Express  Air Freight Plus  Astar USA  Proex Logistics  J&J Logistics Page 6

"Leveraging spending via governmentwide strategic sourcing for Domestic Delivery Services"  Regular town hall meetings to share best practices  UPS reviews to help agencies achieve their DDS2 goals  Fourth year statistics  Over 20,000 new UPS accounts created  $130M spend  17.2M packages shipped  8.75 LBS average package weight  $7.01 average cost per package  98.2% on-time performance  42% Express and 58% Ground Page 7

 Using USPS First Class Mail for letters is still the best deal in town!  Do you really need to send letters via express service?  Service Upgrade  $9 weekly pick up charge waived  Avoiding or minimizing pickup fees  Consolidate packages to a central pickup point, use a Drop Box, take packages to an authorized UPS facility, hand them to a UPS courier  Realize optimal savings without degradation of service  Use UPS Ground vs. Air services to the extent possible "Leveraging spending via governmentwide strategic sourcing for Domestic Delivery Services"

Next Day Mid-A.M. Next Day Mid-A.M. Agencies can further reduce costs by helping users select the optimal service for their domestic packages 9 60% Savings 70% Savings SAMPLE 10 LB ZONE 2 PACKAGE APPROXIMATE TRANSIT TIME FOR GROUND SHIPMENTS FROM THE DC AREA Source: UPS.com … at significantly lower costs than Next Day Mid-A.M. and even Two Day Express Service! UPS Ground service typically delivers packages traveling less than miles in 1 day… Source: UPS DDS rate chart; GSAAdvantage shipment box prices $11.86 Two Day $9.01 Ground $3.49 Total cost to ship excludes surcharges

 DDS3 Award  Dashboard Reporting  Improve Customer Engagement Additional Talking Points

"Leveraging spending via government wide strategic sourcing for Domestic Delivery Services" Page 11 For more information Stevie Graham (703) or