Opportunity To Improve the Army's Stock Distribution Practices

GAO surveyed shipments from Army supply depots to U.S. and overseas customers to determine whether depots were being selected in a manner that would minimize transportation costs and shorten pipeline time.

The Army's system for making shipments from the most economical depot works well based on a limited sample of items shipped from three depots. However, GAO observed two practices which require management attention. There is a lack of coordination and communication between item managers and procurement personnel during the procurement and positioning of stocks to the area-oriented depots. This resulted in numerous shipments being made from one depot to supply the customers of another depot. Consequently, shipments to customers were delayed and there were unnecessary transportation costs. Item managers were not stocking items in the designated area-oriented depot. This practice also caused shipments to be made from depots other than the designated area depot. As a result, customers waited longer to receive shipments and transportation costs were increased. Army officials reported that they are considering a recently developed computer program which would periodically identify items for inter-depot transfer that were significantly out of position. This program would give item managers greater visibility and control over their depot stocks.