Benefits

Map your margin opportunity

Remove waste and drive economies of scale by defining your ideal MMAS through value stream mapping that optimizes material flow and cost efficiency.

  • Kaizen events
  • Value stream mapping

Build a system your team actually uses

Select, implement, or optimize your MMAS toolset while driving adoption across material requirements planning (MRP), transfers, costing, and allocation processes.

  • MMAS tool selection
  • MMAS tool implementation
  • MMAS training

Make your audit a non-event

Prepare for your MMAS audit with mock audits and third-party surveillance that validate process adherence and team consistency before the government does.

  • Mock audits
  • Third party surveillance
  • Real-time audit liaison

Extend your team with MMAS experts

Bring in experienced supply chain and purchasing professionals to accelerate implementation, stabilize operations, and conduct targeted evaluations.

  • Outsourced staffing
  • MPS or BOM evaluations

Related
success stories

Take a deeper dive and discover how we’ve helped clients with MMAS Compliance.

FAQs

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What is MMAS, and why does it matter for our government contracts?

MMAS is the set of policies, procedures, and tools a contractor uses to plan, acquire, store, move, and account for material on government contracts. Under DFARS 252.242-7004, contractors meeting certain thresholds are required to maintain an MMAS that satisfies specific system criteria governing accuracy, cost allocation, and inventory control. The system matters because material costs are among the largest and most variable cost elements on defense contracts. A compliant, well-functioning MMAS reduces cost mischarging risk, supports accurate bill of materials (BOM) costing, and directly affects the contractor’s ability to recover material costs and protect contract margin.

What triggers a government review of our material management system?

MMAS audits are conducted by DCMA, typically as part of a contractor business system review under DFARS 252.242-7005. The review is triggered when a contractor meets the contractual thresholds defined in DFARS 252.242-7004, generally applicable to contractors with qualifying cost-reimbursable or flexibly priced contracts above specified dollar values. DCMA evaluates whether the contractor’s system meets all required system criteria, including the accuracy of material requirements planning (MRP), physical inventory controls, and cost allocation practices. A system determined to have significant deficiencies can result in payment withholds of up to five percent of billings, making audit readiness a direct financial priority.

What are the most common deficiencies found during an MMAS audit?

The most frequently cited MMAS deficiencies cluster around a consistent set of process and documentation failures. Physical inventory accuracy that falls below required thresholds, typically 98 percent for high-value parts and 95 percent for other parts under DFARS 252.242-7004, is a leading finding. Costing and allocation errors, including failure to apply consistent cost transfer practices or maintain adequate audit trails, draw recurring scrutiny. Weaknesses in MRP system configuration, including incorrect lead times, inaccurate demand signals, or unsupported make-or-buy decisions, are also common. Contractors that have not conducted internal mock audits or process adherence reviews prior to government surveillance are consistently the least prepared.

How does MMAS compliance connect to contract profitability and margin?

The connection between MMAS compliance and contract margin is direct and frequently underestimated. An approved, well-functioning system enables accurate material cost recovery, reducing the risk of unallowable or misallocated costs that erode margin on cost-reimbursable and time-and-materials contracts. Value stream mapping and Kaizen-based process improvements embedded in MMAS implementation identify waste, reduce excess inventory carrying costs, and improve material flow efficiency across the supply chain. Contractors with significant deficiencies face not only payment withholds under DFARS 252.242-7005 but also the downstream reputational and contractual consequences of a disapproved business system, both of which carry measurable financial impact.

What should we look for when selecting or upgrading our MMAS toolset?

MMAS tool selection should be evaluated against the specific system criteria in DFARS 252.242-7004 before any procurement or implementation decision is made. The tool must support accurate MRP, lot traceability, physical inventory management, and cost allocation at a level of granularity that satisfies government audit requirements. Integration with existing ERP systems, purchasing workflows, and cost accounting structures is a practical prerequisite, as disconnected systems create reconciliation gaps that become audit findings. Tool capability alone is insufficient without a parallel investment in user adoption, documented policies and procedures, and training that ensures consistent system use across all relevant functions.

How do we maintain MMAS compliance as our contracts and operations grow?

Sustaining MMAS compliance through growth requires a system that scales with operational complexity, not one designed only for current contract volume. As contract types, material categories, and supplier relationships expand, cost allocation methodologies, inventory control procedures, and MRP configurations must be reviewed and updated to reflect actual operations. Third-party surveillance and periodic internal mock audits provide the ongoing validation needed to identify process drift before it becomes a government finding. Contractors that embed MMAS training into onboarding and use outsourced staffing to bridge capability gaps during periods of rapid growth maintain the system consistency that sustains approval status and protects billing recovery across their entire contract portfolio.

Drive margin through MMAS

Reduce variability, control costs, and grow margin across your supply chain and warehouse operations.

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