Adequate information on the organization and functioning of the industrial supply system has not been available. The latest reorganization of the supply system was undertaken at the end of 1971 with a view to providing a normal flow of supplies for the economic trusts beginning in 1972. Until 1971 the supply organizations had dealt almost entirely with individual enterprises. The reorganization was accompanied by extensive consultations with producers of raw materials, importing organizations, and industrial consumers. The consultations were held in order to clarify the needs of consumers, ensure the availability of the needed supplies, and agree upon specific measures for timely deliveries of materials and supplies. Particular attention in the reorganization was paid to the problem of reducing the inventories of materials in enterprises and concentrating them in the supply organizations. Decisive measures were taken to halt the former practice of making deliveries of materials large enough to cover requirements for three months or longer. Under the new system, supply organizations are required to make periodic deliveries to consumers on guaranteed time schedules, at short intervals, and in quantities that do not exceed one month's requirements. Adherence to the regulation is to be used as a standard in evaluating the performance of supply organizations. One of the basic elements in industrial consumer-supplier relations has been the annual contract for estimated material and equipment requirements needed to complete the annual production quota. For a variety of reasons both suppliers and users have often failed to honor these contracts, and the penalties provided for breach of contract have not been sufficient to deter this practice. Breaches of supply contracts have been an important cause of economic difficulties. Supply difficulties have been particularly disruptive because of the traditionally stringent nature of the production plans and the limited availability of resources. In 1972 the Ministry of Supply and State Reserves planned to take energetic measures to strengthen contract discipline and to use contracts as legal and economic instruments for exerting pressure on both parties to fulfill their obligations. The minister considered it particularly important to put an end to the practice of contract cancellation, either under provisions of official regulations or by mutual agreement of the parties concerned--a practice that, according to the minister, caused huge losses to the national economy. Structure