Navy Supply: Intermediate Inventories Can Be Reduced.
Abstract
At the end of fical year 1985, the Navy maintained intermediate inventories of consumable material in the United States worth an estimated $729 million. GAO evaluated whether these inventories were needed for prompt response to customer demands. The Navy has three inventories: consumer inventories to fill demands from one activity, intermediate inventories to fill requisitions from several activities in a geographic area, and wholesale inventories to fill requisitions worldwide. For the most part, consumer inventories are located at a using activity and therefore provide the quickest response to supply requests. Intermediate and wholesale inventories often are positioned together at supply centers and other stock points. The Navy could substantially reduce total inventories without increasing supply response times by: (1) eliminating intermediate inventories that are collocated with wholesale inventories; (2) eliminating intermediate inventories that duplicate consumer inventories; and (3) using average rather than maximum inventory levels to compute intermediate inventory requirements. The Navy also could reduce supply response times without increasing inventories by exerting more control over the requisition priority systems and improving systems for reviewing and processing requisitions and for updating inventory records.
Document Details
- Document Type
- Technical Report
- Publication Date
- Oct 01, 1986
- Accession Number
- ADA173655
Entities
Organizations
- United States Government Accountability Office