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Supplies aren't "put 1 IC in, get 1 IC out" like the other three ways of spending IC. You get about 3-4 supplies for every 1 IC you put in that area, and Industrial Efficiency Supplies is the multiplier. Research away, such techs give you a small but significant boost to IC since you can reduce the number of IC you put into supplies.
Also remember to put logistics generals in charge of newly built units or units in quiet areas. They save 25% on supplies and oil.
Ex. for Germany: inf start out with 1 supply which with a logistics general is .75 which is displayed as .8 For just the 36 inf that Germany starts with, you can save about 11880 supplies before you go to war in Sep 1939. The savings increase as you build and deploy more units.