Re: [MV] DRMO Auctions--The End?????

Mon, 25 Oct 1999 12:49:39 -0400 wrote:

> I would gather from Colemans statement that they have been high bidder on
> what is called a "term sale" from DRMS. These type of sales have been around
> for years. The bidder agrees to purchase all the material of a given
> type...tents, sleeping bags, chairs, scrap paper, whatever...that a DRMO
> generates over a given period of time (usually one year), at a given price,
> which is usually expressed in dollars per pound. This price is determined by
> a bidding process that everyone is allowed to bid in, and is cataloged and
> promoted just like any other DRMS sale.

the sale in question was a 1 year term depot sale, held for a lot of different
commodities (fsc's).it covers several depot's and the material is sent directly
to the buyer, with no inspection,and no guarantee of condition.

> Levy-Latham was awarded a contract to essentially "privatize" DRMO operations
> on specific commodity classes in certain regions.

Levy-Latham's contract is a partnership with the government.However they are to
pay for the material, and then can market it in any way they see fit. the chain
of ownership is - drms / Levy-Latham / and then buyer.

> This is not the same as a term sale. Unless I am very badly mistaken, the
> right and title to the property still passes directly from the Gov to the
> high bidder, not first to L-L, then to bidder. L-L is not buying the
> property from the gov and reselling, but rather more acting as agent or
> broker for the DRMS.

see above, they do buy the material from the gov.

> I suspect that Colemans ad was carefully constructed to gray this area and
> increase their sales through "panic" buying and leaving the impression that
> they were only game in town on certain items, when in fact they are not. I
> don't really have a problem with that, it just seems to be shrewed marketing
> to me.
> Hope this helps,
> David Doyle
> ===
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