Summary: In disposing of surplus property, including aircraft parts, computers, furniture, and clothing, the Defense Department (DOD) is required to make its inventory available to many organizations. Thus, the best items are often taken through transfers and donations, leaving the least marketable items available for sale. These and other factors contribute to DOD's low rates of return. Although the private sector obtains higher rates of return than DOD does for similar items, it does not handle the quantities, types, and conditions of items that the military does. Thus, the private sector is able to develop disposal expertise and tailor its disposal strategies so it obtains higher rates of return. DOD recognizes that it needs to strengthen its management of property disposal, and it has adopted several commercial practices that should improve its operations. DOD is also involving the private sector in some aspects of the process, particularly in surplus property sales, to improve its rate of return and become more business-like. Also, aspects of DOD's disposal process that are not inherently governmental functions may be candidates for outsourcing.
