Logistics & Supply Management
Non-Developmental Item (NDI)
Non-Developmental Item (NDI) according to (FAR 2.101) means:
- Any previously developed item of supply used exclusively for governmental purposes by a Federal agency, a State or local government, or a foreign government with which the United States has a mutual defense cooperation agreement;
- Any item described in paragraph (1) of this definition that requires only minor modification or modifications of a type customarily available in the commercial marketplace in order to meet the requirements of the procuring department or agency; or
- Any item of supply being produced that does not meet the requirements of paragraphs (1) or (2) solely because the item is not yet in use.
A commercial item is: 
- Any item, customarily used for nongovernmental purposes, that has been sold, leased, or licensed to the general public or that has been offered for sale, lease, or license to the general public. For example, items sold in the commercial market, which includes wholesales and retail distribution centers, catalogs, personal sales — items offered for sale commercially, but not yet sold, are also included. General examples of commercial items DoD buys range from food, clothing, and computers to trucks and airplanes. The availability of commercial items to meet a specific defense requirement is determined by market research.
- An item that evolved from a commercial item described in paragraph 1 above. A new model of an existing commercial product, product upgrades, or a new version of a commercial software package are examples.
- An item that meets the description in paragraph 1 above, but with minor modifications to meet DoD needs or modifications of type normally done for commercial customers. Examples include products that are customized commercially, such as automobiles, computer systems, and products with DoD unique modifications that do not change the basic properties or function of the item. Minor is a technical judgment call.
- Any combination of items meeting this definition of commercial item, if it is normally combined and sold commercially. Examples include a computer or video system that is a combination of commercial items, even though the system itself may be a unique configuration.
- A service bought to support commercial items. For example, training, maintenance and service contracts purchased to support items meeting the definition of commercial item are included.
- A service of a type offered and sold competitively in the commercial market at catalog or market prices. Construction, storage and distribution services, aircraft maintenance, and janitorial services are examples.
- Any item or service described in 1 through 6 above, even though it is transferred between separate divisions of a contractor. For example, a commercial item transferred from a commercial division to a defense division of a company is still a commercial item.
- An item developed at private expense and sold in substantial quantities, on a competitive basis, to state and local governments. For example, products sold to state and local governments, not sold commercially, could be bullet proof vests and fire and rescue equipment. Remember this definition was created primarily to trigger the use of FAR Part 12 “Acquisition of Commerical Items” in solicitations and contracts. In that context, including this subset as a commercial item makes more sense.
The term nondevelopmental was coined by Congress in 1986 to describe items that were previously developed. Buying items, already developed allows DoD to avoid paying for the development of new systems, components, and items. In this respect all nondevelopmental items, whether developed for the commercial or the military market, provide this benefit. As a result, the statutory definition of nondevelopmental item included commercial items and still does. When they meet defense needs, however, the acquisition of commercial items provides benefits over and above the acquisition of other previously developed items. Because of the size of the commercial market, commercial items offer price advantages resulting from economies of scale and price competition. Additionally, the commercial industrial base is an important resource, both for greater product availability and for access to state-of-the-art technology. Only through increasing our use of commercial products and practices can we take full advantage of our commercial industrial base. These benefits are especially important in the current environment of reduced defense spending. 
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