Editorial Comment — October 2018
Many commissary suppliers are rapidly losing business; some have even lost their businesses entirely. As more and more private label items hit the commissary shelves, the situation certainly isn’t going to get any better. Though the dollar drain has slowed somewhat, sales continue to decline.
Through Labor Day, so far this year the Defense Commissary Agency has sold nearly 300 million items less than it had by the same time of year two years ago. Patrons have shifted their purchases of more than 10 million items a month elsewhere, and that rate has varied only slightly over the period. Over the past three years, the number has dropped by 400 million items, about one-fifth of the annual unit volume in the entire store system in 2015.
These data tell us only one thing: patrons no longer see the value in the commissary that they did just a few short years ago.
Suppliers, it’s time for you to speak up, if it’s not already too late. Remaining quiet and doing nothing hasn’t increased your sales, has it? Your tax dollars pay to operate the commissaries and you have every right to voice your concerns. Voice them to the agency, top to top. Voice them to the congressman for your district, and to your senators. Doing so won’t make you very popular in certain circles, but the issue isn’t about popularity; it’s about survival.
As Fiscal 2019 begins for the federal government, DeCA included, don’t just stand back and
wait to see what the Pentagon has up its sleeves next for military resale: It will be more of the
same. That may be fine for PL suppliers, but not for your brand-name businesses. It’s time to
rally, to protest the harm that is being done to your companies — and the nation’s military
families — before consultants or contractors come up with another flawed idea that will only
benefit their own pockets. Don’t sit idly by and let what has happened in DeCA over the past
few years infiltrate exchange operations and cause even more lost sales.
A couple of times recently we have asked the Pentagon — where batteries of accountants confidently predict the future, projecting FDYP budgets five years out totaling trillions of dollars — what resale consolidation is expected to cost, noting that we’d be satisfied with a ballpark figure; but to date we have not received any information, not even an off-the-record guesstimate. We hear that some few are sure it can all happen for about $100 million, but discussions around the water cooler place the figure closer to $1 billion, with a “B.”
Here’s a suggestion: Since apparently no one really knows how much this will cost to fund (or maybe they just don’t want to tell anybody), if the currently developing Business Case Analysis favors consolidation of the commissary system with the exchanges, how about taking $400 or $500 million (or whatever the cost comes in at) from DeCA funding to cover it? That way, exchange funds would not be impacted, and they can continue to support their operations and provide the Morale, Welfare and Recreation dividend..
Rather than focus on propping up a declining property, invest in thriving businesses instead!