ILMA Compoundings October 2016 - 36

MILITARY MATTERS

Understanding Military
Sales - Getting Started
Mike Damiani

ost lubricant manufacturers at one time or another
have inquired whether their lubricants, hydraulic fluids
or greases are procured by the U.S. military. Without
a working knowledge of the U.S. Department of Defense's (DoD)
procurement branch (The Defense Logistics Agency, DLA) and
its procedures, policies, information sources and slow-moving
processes, manufacturers' forays into military sales are usually
are short-lived and end with a "That's not for us!" conclusion.
However, with patience and perseverance, a constantly highquality product (and a love of acronyms!), companies that
succeed find supplying the military a rewarding market.
Fortunately, learning the basics, especially where and how to
start, has gotten easier for lubricant manufacturers over the
past 10 years. Understanding the procurement principals and
procurement process can significantly ease the frustration and
time spent entering into military sales.
Until the mid 2000's, almost all military procurement was done
through a cumbersome paper-based bid process with the DoD.
Contracts were awarded either on a "spot basis," or through
a one-year (with multiyear options) Long Term Agreement
(LTA). The finished packaged lubricants were usually shipped
directly to one of the two major U.S. government depots,
either Richmond, VA, or Tracy, CA. In 2007, through the
congressionally mandated Base Realignment and Closure Act
(BRAC), the DoD "privatized" the procurement, warehousing
and distribution of all packaged petroleum products, bulk oil
shipments, lubricants and chemicals under the new "POLCHEM"
contract program. This 10-year contract (5-year base, with
a 5-year option), with an overall contact value budgeted at
$6 billion, was awarded to SAIC of Fairfield, NJ. Under the
POLCHEM contract, SAIC, with its eight strategically located
U.S. warehouses, was now responsible for all procurement,
warehousing, inventory level management, supplier base
management and delivery of the POLCHEM products to U.S.
military and federal civilian agency locations around the globe.
SAIC, partnered with DLA's sub-agency Defence Supply CenterRichmond, is the prime contractor with the responsibility of

the procurement of more than 4,000 NSNs specified in the
POLCHEM contract. An NSN (National Stock Number) is a
unique 13-digit numeric code for identifying standardized items
procured for the U.S. Department of Defense. NSNs are also
recognized by all NATO countries. Every lubricant product that
is procured for the U.S. military has its own NSN. Even the same
product in a different package/container has a unique NSN!
All NSNs are grouped into Federal Supply Classes (FSCs). An
FSC is a four digit field used to group products in logical families.
The first four digits of an NSN designate the FSC. The two
principal FSCs managed by SAIC and applicable to the lubricant
industry are 9150 (Oils and Greases: Cutting, Lubricating and
Hydraulic Fluids) and 6850 (Miscellaneous Chemical Specialties).
Determining whether your product is procured for the military
can be confusing. The product can either be listed as a
commercial item, fall under a military specification (MILSPEC)
or sometimes both! Either way, if the product is procured,
an NSN exists for that product. Keep in mind that military
packaging requirements very often differ from commercial/
industrial requirements. The military likes its lubricants and oils
in metal can packaging, so the need for your product in the
standard commercial one gallon plastic container might not
be a listed NSN procurement item, but the same product in
a metal can might have significant volume potential. As you

Vol. 66 No. 10 * 36 * October 2016 Compoundings

ILMA Compoundings October 2016

Table of Contents for the Digital Edition of ILMA Compoundings October 2016