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In FY 2003, the U.S. Department of Defense (DoD) spent nearly $7 billion on transportation, travel, and relocation services from commercial enterprises. Given a continuing need to make the most of existing resources, including those used for transportation, the U.S. Transportation Command (TRANSCOM) asked the RAND Corporation to conduct a spend analysis of transportation purchases. This analysis of combined individual contracting action report (DD350) and PowerTrack (PT) data indicates that DoD has additional opportunities to leverage transportation spending, particularly where it uses tenders to purchase transportation services. With such leveraging, TRANSCOM could better manage carriers; reduce rates; and improve quality, delivery, and visibility of services. Such improved management of spending and carriers could reduce DoD’s total transportation spending while continuing to meet user requirements. Bringing business currently conducted through tenders under contract could improve incentives and accountability for carriers. Bringing more spending under contracts would also help DoD better meet small business goals.

The research described in this report was sponsored by the U.S. Transportation Command. The research was conducted by the Forces and Resources Policy Center, a RAND National Defense Research Institute (NDRI) program. NDRI is a federally funded research and development center sponsored by the Office of the Secretary of Defense, the Joint Staff, the Unified Combatant Commands, the Department of the Navy, the Marine Corps, the defense agencies, and the defense Intelligence Community.

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