Highlights of the October 2018 Issue
Armed Forces Marketing Council
(AFMC) President Tom Gordy
Since March 2008, Tom Gordy has led the Armed
Forces Marketing Council (AFMC), a group which
exists “to protect and enhance earned quality-of-life
benefits provided through the commissaries and exchanges
for military families.” Gordy, a Navy Reservist
and a military store patron himself, has worked to
support these benefits for years, engaging with congressional
and military industry leaders to address
issues of concern to AFMC members. In this exclusive
interview, he talks about the state of military resale
and the atmosphere of reform, and how current reforms
might play out for store patrons today and in
the near future.
E and C News: How does the Armed Forces Marketing
Council (AFMC) differ from the American
Logistics Association (ALA)?
Tom Gordy: The main difference between
AFMC and ALA is membership. The AFMC is a
non-profit business league for military brokers.
While we address many of the same issues as the
ALA, there are some particular issues pertaining
to brokers that the Council addresses that are not
typically addressed by the ALA.
E and C News: Through its members, AFMC
represents a major portion of resale suppliers to
both commissaries and exchanges. What are they
telling you about their issues and concerns with
the changes that have taken place to military
resale and the ongoing reforms? As a patron,
how have you and your family been affected?
Gordy: The member companies of the AFMC
represent about 60 percent of the products sold in
military resale. So if there is an issue that is affecting
military resale, it usually affects the members
of the Council as well.
We have seen tremendous churn in the industry
over the past few years — churn created within
the Department of Defense (DoD), on Capitol
Hill, within the resale systems and in the civilian
marketplace, whether budget issues, reform,
consolidation or e-commerce and m-commerce.
Some of it has been positive, and some less so.
The members of the Council do not fear the
competitive challenges, because competitiveness
results in a stronger benefit. They also do not fear
potential reforms, as long as there is a strong business
case that supports the reforms and that they
deliver a better and stronger benefit for military
The reforms currently being implemented at
DeCA may have some level of justification from
a business perspective. However, from a benefit
perspective, the reforms are negatively impacting
the benefit through higher prices and loss of topselling,
high-quality national brands on the shelf.
Essentially, current reforms are shifting the
cost of the delivery of the benefit onto the beneficiaries
and the industry. This, in our view, is
leading to an erosion of patron confidence in
their earned benefit as evidenced by declining
sales, transactions and units purchased as well
as shrinking market baskets. ...
Read more TOM GORDY INTERVIEW ...
From Bangor, Wash., to Bahrain and beyond, Navy Exchange Service Command (NEXCOM)
tactical departments are adept at ensuring their patrons have the products they
want for their respective missions — whether Pilot, Seabee, SEAL or regular Sailor — wherever
they serve, just when they need them, and at a savings versus outside the wire. NEXCOM’s
tactical department has also adjusted its sails, and planograms, to allow more flexibility to
highlight hot categories and be “first-to-market” with new products and suppliers.
Lisa Matthews, who was NEXCOM’s tactical buyer through July, reported that category
sales through fiscal 2018’s Week 26, ending Aug. 4, 2018, were $4.24 million overall, down
about one quarter of a percent from the prior year. Unit volume, however, had dipped,
from 205,671 units last year to 192,151 this year, a 6.57-percent decrease (see chart). As of
July, Courtney Batte, formerly the pet category buyer, had assumed responsibility for the
“Overall sales in the tactical category
are flat to last year,” Matthews
said. “The fleet locations have been
negatively impacted due to ship movement.
Our top locations have seen
fewer ships in port than last year,
which has impacted business.” Thus
far in fiscal 2018, five of the 10 top
NEXCOM stores by sales volume were
overseas operations. ...
Read More NEXCOM TACTICAL GEAR UPDATE ...
Operating 504 exchanges and 237 commissaries, as well as hundreds
of smaller convenience stores, package stores, troop stores and
other facilities, the military resale system is to be found wherever
U.S. Soldiers, Sailors, Airmen, Marines or Coastguardsmen fly the flag,
providing essential quality-of-life support for servicemembers and their
families. These pages present statistical information — demographic,
geographic and financial — on the military resale system and its customers. ...
Read more MILITARY RESALE MARKET DEMOGRAPHICS ...
Direct Sales, FY 2017 Total:$10,594.50 (+2.9%)
All Sales in Millions
Read more EXCHANGE SALES ...