Navy Working Capital Fund - DON FM&C Website

February 2011NAVY WORKING CAPITAL FUND (NWCF)The NWCF is a revolving fund that finances Department of the Navy (DON)activities providing products and services on a reimbursable basis, based on acustomer‐provider relationship between operating units and NWCF supportorganizations. Customers send funded orders to the NWCF providers who furnishthe services or products, pay for incurred expenses, and bill the customers, who inturn authorize payment. Unlike for‐profit commercial businesses, NWCF activitiesstrive to break even over the budget cycle.NWCF activity groups comprise five primary areas: Supply Management, DepotMaintenance, Research and Development, Base Support and Transportation. Thewide range of goods and services provided by NWCF activities are crucial to theDON’s conventional and irregular warfare capabilities as well as its ongoing roles inOverseas Contingency Operations (OCO). The value of goods and servicesprovided by NWCF activities in FY 2012 is projected to be approximately $28 billion.FY 2012 NWCF budget estimates reflect the impacts of a number of efficiency andoverhead reduction initiatives such as the reduction of Supply related informationtechnology and inventory costs through the use of Navy Enterprise ResourcePlanning (ERP), limiting facilities sustainment expenses to 80 percent ofrequirements, curtailing cell phone/Personal Digital Assistant expenses, eliminationof some low‐use/high cost infrastructure, overhead function consolidation, “lean”project team operations, and support services reductions. The cumulative effect ofthese cost saving reductions through FY 2012 is over $220 million dollars and theyare reflected in the revised rates charged to NWCF customers.Supply ManagementSupply Management performs inventorymanagement functions that result in the sale ofaviation and shipboard components, ship’s storestock, repairables, and consumables to a widevariety of customers. A key component of thelogistics capability area, Supply Management isthe central element assuring DON andDepartment of Defense (DoD) operating forcestheir equipment has the necessary supplies, spare parts, and components to conductOCO engagements, various types of training, and any potential contingency.Ensuring the right material is provided at the proper place, time, and cost is vital toequipping and sustaining Navy and Marine Corps warfighting units. Supply6‐1