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Editorial Comment — February 2014


THE EXCHANGE CONNECTION ...

During any of this drawn-out high-stakes tug-of-war over commissary funding, transportation funding, and defense vs. civilian budgets in general, has anyone in government really thought much about its impact on military exchanges: the goods and services they provide on base, the Morale, Welfare and Recreation (MWR) dividends they generate, the family programs they help support?

While 2013's sequestration furloughs and government shutdown clearly hurt patrons, commissary sales and customer satisfaction, what seems to have been totally overlooked is the impact on exchange sales. And if the commissary benefit is compromised, whether by closures, or the latest dumb-ass proposal — raising commissary prices to nonappropriated fund (NAF) levels — so too will the exchanges be compromised. Many commissary customers are extremely price sensitive; they combine shopping trips; and they have little time and scant resources to waste. They need the right mix of products at the right price. Military family shoppers will be hit directly in the pocketbook if commissary prices are increased. And that will have a domino effect on exchange shopping trips and earnings.

If any changes to compensation are made that disrupt commissary savings or DeCA's value proposition — or that force assortments into a pricing corner that turns customers away — they will also stymie much of the exchange systems' hard work to capture shopping trips and generate sales and dividends.

MWR is already under pressure; those family and morale services are hard enough to fund already without adding a reduction in dividends to their problems.

Exchanges go where the armed forces go, anywhere in the world; they go where they must because they are needed. Let's not make their work unsustainable by short-sighted policy making; instead, let's give the entire system the support it needs to perform its vital mission.

STOP. RIGHT. THERE. ...

When the smoke is so thick that you know there's a fire, it is just not enough to say “there are no plans to burn down the house.”

The same goes for Department of Defense (DoD) leadership when the response to news reports of back-room plans to slash commissary funding is an unconvincing “no commissaries are closing” … but by the way, we have this plan to raise commissary prices.

Stop. Right. There. That is a military pay cut, and it's a pay cut felt most deeply by those career families who are the very backbone of the force.

Congress and the administration urgently need to get behind servicemen, servicewomen and their families and let the Pentagon's leadership and finance department know in no uncertain terms that such a proposition is unacceptable, a non-starter in any form that diminishes or destroys the benefit.

Let there be no doubt in anyone's mind that there is a fine line, especially on pricing and assortment, which if crossed would spell disaster for the commissary benefit. The NAF model that has been proposed for commissaries is one that will at the very least erode and could easily torpedo the benefit in its entirety — taking along with it the DeCA workforce (a double hit to that part who are military family members), the members of other organizations such as the National Industries for the Blind employed within it, or those who supply it with merchandise, and the entire segment of U.S. industry that supports it.

Members of Congress and congressional staff will need to exercise the utmost care as they look for solutions to plug any funding gaps. Prices cannot be raised across the board — because not all products carry the same margins or provide anywhere near the same savings. Plain and simple, retail does not work like that. Raise any high-cost, low-margin “must-have” item by a point too much, and the customer will not make the trip. The difference cannot be recaptured by raising prices in meat, dairy and produce, or any other of the commissary's “destination” (i.e., highest savings) categories. DoD cannot afford to experiment with the commissary; the margin for error is too narrow. There is a delicate balance between sustaining this benefit that is so important to so many military families and retirees, or destroying it.

Do not be fooled into thinking there is a simple solution to squeezing commissary funding. Active duty, reserve, retiree … military family livelihoods hang in the balance, and our nation's men and women in uniform should be treated with the respect they have earned through their service.

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