The US shipbuilding industry finds itself pressed on many sides by dwindling government and commercial ship orders. Without significant improvement in performance, the US shipbuilding industry will contract to the minimum that can sustain government and Jones Act commercial ship demand. There has been considerable benchmarking of the US shipbuilding with other shipbuilding countries and other US and foreign industries. In these studies, the improved management of the supply chains has been found to be an important way to improve performance. The 1996 21s' Century Agile Shipbuilding Strategies report identified improvement in the relationship between shipyards and their suppliers as one of the highest priorities. In the marine industry over 50% of the cost of the delivered product is for material and equipment. When significant turn-key subcontracting is used this can increase to 75%. Over the past two decades, most US shipbuilders acknowledged that their productivity was significantly lower than world class shipbuilders. More recently they have acknowledged a material cost differential of up to 33%. Clearly, the cost of material is one of the major sources of the lack of international competitiveness of the US marine industry. The performance of the US automotive and aerospace industries has improved significantly by focusing on and improving their supply chain management. Much of Boeing's and Chrysler's improvement has been attributed to successful change in this area. This paper describes the results of a project that analyzed supply chain management in the marine industry as a way to develop a set of best practices.