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PLRD-82-109 1 (1982-08-16)

handle is hein.gao/gaobabmne0001 and id is 1 raw text is: C ~UNITED STATES GENERAL ACCOUNTING OFFICE LL7 WASHINGTON, D.C. Z0548 PROCUREMENT, LOGISTICS, AND READINESS DIVISION B-208024 AUGUST 16,1982 The Honorable Gerald P. Carmen Administrator of General Services Dear Mr. Carmen: 119188 Subject: Consolidation of GSA's Depot Function Can Save Millions in Space Costs and Improve the Use of Depot Resources (GAO/PLRD-82-109) We have reviewed the General Services Administration's (GSA's) depot system for storing and distributing commonly used supply items. Although the system has improved in recent years, further improvement is needed. Over the past 10 years, the system has been reduced from 25 to 15 depots. However, we believe the system can be reduced more. We estimate that consolidating the 15 depots into 8 can save nearly $7 million annually in space costs and reduce the inventory by $25 million. In addition, we believe the consoli- dation can improve supply performance by more effectively using depot personnel. BACKGROUND From its beginning in 1949 until about 1972, GSA's annual sales of stocked materials grew from $26 million to $522 million. During 1972, it stocked about 30,000 different items in 25 depots. Although annual sales have risen to more than $700 million since 1972, both the number of items stocked and the number of depots have been reduced. In 1981 GSA stocked less than 18,000 supply items in 15 depots. Before 1976 the GSA supply system was operated on a regional basis. Each region had near complete autonomy and managed, pur- chased, and stocked supply items to meet its customers' needs. In 1976 the inventory management and procurement functions were reorganized to eliminate duplication among the regions. While the inventory managers and procurement staff were left (943095) 0 3 (30 e

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