Air Force Logistics

Pursuant to a congressional request, GAO examined the Air Force's management of its excess retail inventory, focusing on whether the Air Force: (1) accurately and completely reported the inventory; (2) properly considered it in procurement decisions; and (3) used it to fill other retail activities' requisitions.

GAO found that: (1) between September 1987 and March 1990, inventories of consumable items and low-cost equipment that exceeded Air Force operating needs increased from $442 million to $927 million; (2) the Air Force accumulated about $1 billion in excess retail inventories due to limited visibility over retail excess by wholesale inventory managers and the Defense Program for the Redistribution of Assets (DEPRA); (3) limited visibility occurred because the Air Force does not require complete reporting of retail-level excess and allows retail activities to prematurely cancel reports of excess; (4) air logistics centers (ALC) did not always use reported excesses to fill backorders and DEPRA was not aware of many redistribution opportunities; (5) ALC issued redistribution orders to fill backorders in only about 21 percent of 244 excess reports; (6) the primary reasons for excess retail inventory included decreasing demands, customer turn-ins, requisitioning problems, inventory adjustments, and deletion of adjusted levels; and (7) the Air Force is studying inventory growth to develop strategies for reducing inventories, but it is not broad enough to identify specific corrective action.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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