Military  Market  Facts  June  2016  

A  Brief  Overview  

Our  History    •  1920  Incorporated  as  the  Quartermaster’s  Associa7on  (QMA)    

   QMA  was  composed  of  officers  of  the  Regular  Army,  the  Na:onal  Guard,  the  Organized  Reserves,  key  civilians  in  the  federal  government  and  leaders  of  industry.    QMA  disseminated  professional  informa:on  concerning  all  Quartermaster  and  related  ac:vi:es,    and  fostered  and  promoted  a  spirit  of  coopera:on  and  friendly  exchange  of  ideas  among  the  members.    

•  1961  QMA  becomes  the  Defense  Supply  Associa7on  (DSA)      The  name  was  changed  in  response  to  the  establishment  of  the  Defense  Supply  Agency,  as  well  as  the  increasing  responsibili:es  being    placed  upon  the  U.S.  Army  Quartermaster  Corps  to  provide  food,  clothing  and  general  supplies  to  all  the  Armed  Forces  under  DoD’s    single  manager  concept.    The  Associa:on  was  composed  of  officers  of  the  Armed  Forces,  key  civilians  in  the  federal  government  and    leaders  of  industry.    

•  1972  DSA  becomes  the  American  Logis7cs  Associa7on  (ALA)      To  eliminate  confusion  with  the  Defense  Supply  Agency,  the  Associa:on  changed  its  name  to  the  American  Logis:cs  Associa:on  and    adopted  the  “eagle  in  the  oval”  logo.    The  new  ALA  carried  forward  the  same  objec:ves  of  the  Quartermaster  and  Defense  Supply    Associa:ons.    According  to  an  editorial  in  the  July/August  1972  issue  of  ALA’s  Review  Magazine,  the  new  name  “was  chosen  to  “show    clearly  who  we  are,  what  we  do  and  how  we  intend  to  func:on.    ‘American’  must  always  exalt  the  pride  of  patrio:sm…we  believe  in    our  country,  in  its  customs,  in  its  ideas  and  in  its  business  efforts.    ‘Logis:cs’  is  defined  as  that  branch  of  the  military  art  which    embraces  the  details  of  transport  and  supply.    ‘Associa:on’  is  a  union;  a  connec:on  of  persons  or  things,  or  a  union  of  persons  in  a    company  or  society  for  some  par:cular  purpose.”  

 •  1974  ALA  reorganizes  into  a  na7onal  trade  associa7on                          Led  by  a  Board  of  Directors  comprised  of  representa:ves  from  industry,  the  newly  organized  associa:on  was  designed  to  serve  

 industry  and  its  related  interests  in  military  and  other  government  ac:vi:es.    

•  2005  ALA  Board  of  Directors  revised  the  mission  of  ALA      To  include  a  focus  on  Total  Quality  of  Life  and  MWR/Services.  The  American  Logis:cs  Associa:on  promotes,  protects,  and  enhances    the  military  resale  and  quality  of  life  benefits  on  behalf  of  our  members  and  the  military  community.  

 

Programs  and  Services  

•  It  is  our  goal  to  provide  valuable  programs  and  services  that  enable  all  members  to  operate  effec:vely  and  efficiently  with  the  military  resale  system  and  services.    

 •  ALA  is  the  only  organiza:on  that  can  give  you  the  resources  and  the  

informa:on  you  need  to  succeed.    We  strive  to  increase  the  visibility  of  the  Associa:on  and  enhance  the  services  that  ALA  provides  its  members.  

Contact  InformaAon  

American  Logis:cs  Associa:on  1101  Vermont  Ave,  N.W.  

Suite  1002  Washington,  DC  20005  Phone  (202)  466-­‐2520  

Email:    membership@ala-­‐na:onal.org  www.ala-­‐na:onal.org    

Military  Resale  Market  FY  2015  Total  Sales:    $                    Billion  

Exchanges  $  13.502  B  Thru  2014    

Commissaries  $  5.51  B  

Ships  Afloat  $63.8  M  Thru  2014  

Exchange  Data  will  be  updated  with  Audited  2015    sales  Sept  2016  

 

Military  Patrons  AcAve  Duty  Demographics  

Authorized  Shoppers  Total  Shoppers    Authorized  2014:  12.6  Million  

Source:  AAFES  Con9ngency  Planning  Office-­‐Ac9ve  Duty  declining  2012-­‐2016    

Guard  &  Reserve  1.190  Million  

DoD  Civilian  Employees  776,198  Million  

Ac7ve  Duty  1,514.3  Million  

Re7rees  2.436  Million  

Family  Members  6.93  Million  

1.37   1.37  

1.44  

1.39  

1.43   1.43  

1.4  1.39  

1.38  

1.41  

1.38  

1.4  

1.47  

1.35  1.34  

1.32  

1.20  

1.25  

1.30  

1.35  

1.40  

1.45  

1.50  

1999   2000   2001   2002   2003   2004   2005   2006   2007   2008   2009   2010   2011   2012   2013   2014  

Ac7ve  Duty  Military  Personnel  Trend  Million  $  

Calendar  Year  

Active Duty Demographics

Age  

<25   43%  

26-­‐30   22%  

31-­‐35   15%  

36-­‐40   11%  

41+   22  

50+   .01%  

Officers   Enlisted  

16.4%   83.5%  

Male   Female  

 1,170,702  

 85.3%   200,945   14.2%  

Source:  DMDC  Updated  –Declining  -­‐2016  

Military  Resale  Agencies  

•  Defense  Commissary  Agency  (DeCA)  •  Army  and  Air  Force  Exchange  Service  (AAFES)  •  Navy  Exchange  Service  Command  (NEXCOM)  •  Marine  Corps  Exchange  (MCX)  •  Coast  Guard  Exchange  Systems  (CGX)  •  Veterans  Canteen  Service  (VCS)  

Defense  Commissary  Agency  

Director/CEO:  Joseph  Jeu,  SES  

 Deputy  Director/COO:  

Michael  Dowling    

Selected  Opera7ons  and  Services:  Grocery;  Freeze;  Chill;  Produce  Meat;  Dairy;  Deli/Bakery/Sushi  

 

FY  2015  Sales:  $5.51  Billion  

Established:    1991    Employees:    Approximately  17,000    Headquarters:  1300  E  Avenue  Fort  Lee,  VA  23801-­‐1800  Phone:    (804)  734-­‐8253  Web  site:    www.commissaries.com    Major  Distribu7on  Facili7es:  CONUS  Civilian  Distributor  Network  Overseas  DeCA  Central  Distribu:on  Centers  

DeCA  Profile    

Director  /  Chief  Execu:ve  Officer  

Deputy  /  Chief  Opera:ng  Officer  

Execu:ve  Director    Store  Opera:ons  

Execu:ve  Director  Sales,  Marke:ng  &  Policy  

Program  Management  

Resource  Management  

Human  Resources  

Informa:on  Technology  

Engineering  

Logis:cs  

Sales  

Health  &  Safety  

General  Counsel  

Washington  Office    

Store  Support  

CONUS  and  OCONUS  Stores  

Senior  Enlisted  Advisor  

Inspector  General  

Acquisi:on  Management  

Opera:ons  &  Policy  

Resale  Contrac:ng  

EEO  

Blue  blocks  -­‐  ALL  assets  at  Fort  Lee  

Yellow  blocks    -­‐  ALL  assets  geographically  dispersed  

Green  blocks    -­‐  assets  located  at  Ft  Lee  &  geographically  dispersed    

Strategic  Planning  

CDC  and  CMPP  

Chief  Performance  Officer  (PAO,  CPI  and  ESD)  

Business  Development  

Execu:ve  Director  Infrastructure  Support  

E-­‐Commerce  

Shopper  Insights  

Equip/Property  Acct  &  Environmental  

Business  Requirements  Cell  

DeCA  Organiza7on  

14  

Mission  Statement  

Deliver  the  Premier  Quality  of  Life  

Benefit  to  the  Armed  Services  

Community  -­‐  To  enhance  recrui7ng,  

reten7on  and  readiness  by  efficiently  

and  effec7vely  providing  excep7onal  

savings  and  excellent  products  and  

superior  services  -­‐  EVERYTIME,  

EVERYPLACE.    

DeCA  Facts  

•  Annual  opera:ng  Budget-­‐  Congressionally  Funded  •  Headquarters-­‐  Fort  Lee,  Virginia  •  FY  2015  Sales-­‐  $5.51  Billion  •  FY15  240  stores  (168  CONUS  and  72  OCONUS)  •  Merchandise  sold  at  cost  plus  1%  to  cover  shrinkage                  plus  5%  surcharge  applied  at  register  •  Vendor  stocking  required  for  some  categories  •  Es:mated  that  45%  of  DeCA  shoppers  are  re:rees  •  Commissaries  recognized  as  the  Premier  Quality  of  

Life  non-­‐pay  benefit  

4.9   5   5   4.97   5.04  5.24   5.37   5.42   5.56  

5.8  5.98   5.84   5.96   6.09  

5.87  5.63   5.51  

0.00  

1.00  

2.00  

3.00  

4.00  

5.00  

6.00  

7.00  

1999   2000   2001   2002   2003   2004   2005   2006   2007   2008   2009   2010   2011   2012   2013   2014   2015  

DeCA  Fiscal  Year  Sales  Billion

 $  

Fiscal  Year  

America’s  Top  Food  Retailers  Company Name Sales (000) No. Stores

1. Wal-Mart $298,378,000 4,132

2. Kroger $109,800,000 2,623

3. AB Acquisition $58,322,940 2,290

4. Publix $32,400,000 1,114

5. Ahold USA $26,400,000 788

6. HEB $23,000,000 315

7. Delhaize America $18,058,000 1283

8. Meijer $16,700,000 223

9. Wakefern Food Group $15,700,000 187

10. Whole Foods Market $15,389,000 419

11. Trader Joe’s $12,800,000 448

12. Southeastern Grocers $11,898,000 750

13. Aldi $10,900,000 1,451

14. Target $10,400,000 249

20. Defense Commissary Agency $4,646,389 177

Source: Progressive Grocer Magazine, Nielsen March 2016

19 19

*  DeCA  sales  data  based  on  CY  2012  data  for  U.S.  stores  (including  Puerto  Rico)  over  $2  million  in  CY  2012  (171  Commissaries)  to  compare  with  industry  **  Savings  %  used  was  the  2012  DeCA  U.S.  (50  State)  savings  of  29.4%  aVer  tax  and  surcharge.    This  %  is  applicable  to  U.S.  data  as  used  in  these  computaAons.    Overall  2012  DeCA  Worldwide  savings  aVer  tax  and  surcharge  was  31.2%  ***Supermarket  data  from  Food  MarkeAng  InsAtute  (FMI)  Web  site  www.fmi.org  (Supermarket  Facts  -­‐  Figures  -­‐  Industry  Overview)  

Measure DeCA Actual* DeCA**

Adjusted for DeCA Savings

Supermarket***

Weekly Sales/Square Foot $17.36 $24.59 $10.22

Weekly Sales $577,421 $817,784 $318,170

Customer Purchase $65.79 $93.17 $35.01

Square Feet/Store 33,261 33,261 46,000

Sales $5.134B $7.272B $602.609B

Average Days Open Per Week 6.23 6.23 7

Average Hours Open Per Day 9.74 9.74 12 - 24

DeCA  Sales  Informa7on  

Store  Rank  Sales   FY2015  Sales   FY2015  Transac7ons  

#1  Fort  Belvoir,  VA   $93,282,316   1,031,773  

#5  Fort  Campbell,  KY   $71,074,292   1,011,491  

#10  Ramstein  AB,  GE   $63,107,698   1,314,432  

#25  Eglin  AFB,  FL   $51,005,294   659,239  

#50  Fort  Riley,  KS   $37,831,551   671,589  

#100  Naples  NAS,  Italy   $21,304,947   414,556  

Source:  DeCA  EOY  FY15  Sales  Report  

DeCA  Prices  All  Merchandise  at  Cost  +1%  (shrinkage)  +  5%  (surcharge)  

•  No  Slotng  fees  or  co-­‐op  adver:sing  •  100%  of  all  deal  money  is  passed  to  the  patron  •  1%  added  at  shelf  &  5%  is  added  at  the  register  

An  ideal  test  market  scenario  since  the  effect  of  trade  funds  can  be  accurately  

assessed  

Distance  Deters  Commissary  Store  Visits  •  The  average  Commissary  is  2.5  7mes  as  far  from  home  as  the  local  grocery  store  •  However,  by  a  2  to  1  margin,  patrons  are  willing  to  put  up  with  inconveniences  to  save  

30%  on  their  grocery  bill  

Coupons,  SNAP  and  WIC  Historical  Comparisons  

COUPONS FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 – thru Oct 15

Coupon Dollars $93,744,094 $98,835,469 $94,160,582 $105,198,170 $114,122,168 $112,703,419 $104,188,496 $91,005,779 $83,742,771 $71,843,845 $5,741,213

Coupon Quantity 127,630,435 126,484,119 116,944,671 123,931,649 129,353,453 123,027,684 113,297,927 99,600,279 89,160,971 73,998,178 5,935,194

$ per Coupon $0.73 $0.78 $0.81 $0.85 $0.88 $0.92 $0.92 $0.91 $0.94 $0.97 $0.97

% Change in Coupon $ vs. Prior FY 5% -5% 12% 8% -1% -8% -13% -8% -14% -14%

% Change in Coupon # vs. Prior FY -1% -8% 6% 4% -5% -8% -12% -10% -17% -16%

% Change in $ per Coupon vs. Prior FY 6% 3% 5% 4% 4% 0.40% -1% 3% 3% 2%

SNAP FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 – thru Oct 15

SNAP Dollars $26,225,702 $24,851,516 $31,146,015 $52,954,938 $72,831,952 $87,837,643 $98,842,699 $103,670,751 $84,575,783 $79,550,563 $6,247,837

SNAP Transactions 272,899 233,876 282,879 501,477 717,006 856,330 947,930 968,358 805,325 750,853 59,551

SNAP $ per Transaction $96.10 $106.26 $110.10 $105.60 $101.58 $102.57 $104.27 $107.06 $105.02 $105.95 $104.92

% Change in SNAP Dollars vs. Prior FY -5% 25% 70% 38% 21% 13% 5% -18% -6% -17%

% Change in SNAP Trans vs. Prior FY -14% 21% 77% 43% 19% 11% 2% -17% -7% -15%

% Change in SNAP $/Trans vs. Pr FY 11% 4% -4% -4% 1% 2% 3% -2% 1% -3%

WIC FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 – thru Oct 15

WIC Dollars $28,757,876 $29,266,430 $31,574,375 $30,209,689 $29,585,040 $29,878,377 $31,238,896 $29,223,857 $25,547,180 $23,975,653 $1,954,586

WIC Transactions 1,818,343 1,719,078 1,653,307 1,651,080 1,779,760 1,754,843 1,793,576 1,655,182 1,397,949 1,279,919 106,257

WIC $ per Transaction $15.82 $17.02 $19.10 $18.30 $16.62 $17.03 $17.42 $17.66 $18.27 $18.73 $18.39

% Change in WIC Dollars vs. Prior FY 2% 8% -4% -2% 1% 5% -6% -13% -6% -9%

% Change in WIC Trans vs. Prior FY -5% -4% 0% 8% -1% 2% -8% -16% -8% -8%

% Change in WIC $/Trans vs. Prior FY 8% 12% -4% -9% 2% 2% 1% 4% 3% -2%

DeCA  Business  Drivers  

•  Promo7ons  via  Display  (Presented  to  DeCA  Headquarters)  

•  Manager  Specials:  Category  leaders,  high  volume  items,  deep  discounts,  mandated  display,  administered  via  automated  VCM  at  Headquarters  

•  Power  Buy  Display:    High  volume  items,  excellent  prices,  mandated  quan::es  and  display  

•  One  Time  Buys/Shippers:  Highly  consumable,  impulse  items  

•  Sidewalk/Case  Lot  Sales:  Special  events  selling  to  patrons  in  case  increments  

•  Dollar  Days:  Dollar  price  points  and  dollar  mul:ples  on  brand  name  food  items    

•  Coupons:    On-­‐shelf  manufacturer  coupons,  FSI  coupons  &  Internet  coupons  all  accepted  

•  In-­‐store  Demos:    Very  effec:ve  and  cost  efficient  •  Adver7sing:    Several  effec:ve  Military  specific  vehicles  

available  

6/1/16

Mountain Home AFB  

Malmstrom AFB  MT  

WA  

OR   ID  

Whidbey Island NAS  Smokey Point  McChord AFB  

Fairchild AFB  Ft Lewis  Bangor ANSB  Bremerton NS  Coastal Pacific Fife

SuperValu Tacoma

Travis AFB  Moffett Field  McClellan AFB  Beale AFB   Fallon NAS  

Ord Community   NV  

CA  

Fort Huachuca  

Nellis AFB  

Luke AFB  

Fort Hunter Liggett  Lemoore NAS  

Yuma PG  Davis-Monthan AFB  

Yuma MCAS  El Centro NAF  

Los Angeles AFB  

Imperial Beach  

Vandenburg AFB  March AFB  FT Irwin  Edwards AFB  

Miramar MCAS  North Island   Twenty-nine Palms  Barstow MCLB  Port Hueneme  Camp Pendleton  

San Diego NS  AZ  

White Sands MR  Holloman AFB  Cannon AFB  

Kirtland AFB  NM  

Hill AFB  Dugway PG   Buckley AFB  

F.E. Warren AFB  

USAF Academy  Fort Carson  Peterson AFB  

WY  

CO  

UT  

Offutt AFB  

Ft Riley  Ft Leavenworth  

Ellsworth AFB  

Grand Forks AFB  Minot AFB  

NE  

SD  

ND  

MN  

IA  

SuperValu Bismarck

Goodfellow AFB  Ft Hood  

Dyess AFB  Sheppard AFB  

Tinker AFB  Ft Sill  

Altus AFB  Vance AFB  

McConnell AFB  

TX  

OK  

KS  MDV Junction City

Fort Bliss  

Corpus Christi NAS  Kingsville NAS  

Lackland AFB  Ft Sam Houston  Randolph AFB  

MDV San Antonio

Laughlin AFB  

Meridian NAS  Keesler AFB  Gulfport NCBC  

New Orleans NAS  

Columbus AFB  AR  

LA  

MS  

Little Rock AFB  

Ft Leonard Wood  Whiteman AFB  MO  

IL  

KY  

IN  

Harrison Village  Rock Island  Crane NSWC  Scott AFB  

Ft Knox  Ft Campbell  

Great Lakes NTC  

MI  

WI  

Ft McCoy  Selfridge ANGB  

Arnold AFS  

Eglin AFB  Hurlburt Field  

Tyndall AFB  Ft Rucker  

Gunter AFB  Redstone Arsenal  

Maxwell AFB  

TN  

AL  

Pensacola NAS  MDV NF Pensacola

SuperValu Anniston

Whiting Field NAS   Kings Bay NSB  Jacksonville NAS  

Mayport NS  

Key West NAS  

Patrick AFB  MacDill AFB  

FL  

SuperValu Quincy

SuperValu Indianola

Camp Merrill  Ft McPherson  

Ft Benning  Moody AFB  Albany MCLB  GA  

Charleston NWS  Charleston AFB

Shaw AFB  Parris Island  

Ft Jackson  Ft Gordon  

NC  

VA  

New River MCAS  Camp Lejeune  Cherry Point MCAS  Seymour Johnson AFB  Ft Bragg North & South  

MDV Norfolk

Annapolis  Quantico  Ft Belvoir  Ft Myer  

Ft Meade  Bolling AFB  Andrews AFB  

Portsmouth NNSY  Ft Lee   Little Creek NAB  Dahlgren NSWC  Ft Eustis  Patuxent River NAS  Oceana NAS  Langley AFB  Norfolk  

VA   Forest Glen  Ft Detrick  DE  

NJ  

MD  Dover AFB  Lakehurst NAES  McGuire AFB  

MDV Landover

PA  

OH  

C.E. Kelly  Carlisle Barracks  

Wright Patterson AFB  

MA  RI  

CT  

NY   Hanscom AFB  Newport NS  

West Point  Tobyhanna AD  

Picatinny   Mitchel Field  Fort Hamilton  New London  

ME  

VT  NH  

Bangor ANGB  Portsmouth NSY  Fort Drum  

C & S Wholesalers

Aberdeen  

Hunter AAF  Robins AFB  Ft Stewart  SC  

Memphis NSA  

Ft Polk  Barksdale AFB  

China Lake NAWS  WV  

DeCA  Distributors  

Richards Gebaur  

Always Fresh

MDV NF Bloomington

MDV Columbus

SuperValu Lancaster

Sugar Grove  

Fort Worth  

Saratoga Springs  

SuperValu Champaign

SuperValu Billings

SuperValu Mechville

MDV Oklahoma

Coastal Pacific Ontario

Coastal Pacific Stockton

Military Exchange

Market

A Closer Look 50 States

2 U.S. Territories

30 Foreign Countries

Exchange  Sales  Trends  AAFES/MCX/CGX/NEX/VCS  

Billion  $  

9.7  10.2  

10.8  11.3   11.7   12.1   11.9   12.3  

14.04   14.05  12.97   13.01   12.98  

11.4  

0  

2  

4  

6  

8  

10  

12  

14  

16  

Exchanges AAFES, NEXCOM and Marine Corps Exchanges •  Operate as Federal Instrumentalities - unique organizations within

the DoD •  Self-funded, using few tax dollars •  Exchanges pay their own operating costs from Revenues •  Return earnings to Customers through payments to Morale,

Welfare and Recreation Activities and investments in new, renovated exchange facilities

Coast Guard Exchanges •  An MWR activity; Coast Guard is part of the Department of

Homeland Security Veterans Canteens •  Operates under the authority of the Department of Veterans Affairs

AAFES Profile Established: 1895

Employees: 37,000

Headquarters: 3911 S. Walton Walker Blvd. Dallas, TX 75236-1598 Phone: (214) 312-2001 Web site: www.aafes.com Major Distribution Facilities: Newport News, VA; French Camp, CA; Waco, TX; Giessen, Germany; Tokyo, Japan; Yokota, Japan; Inchon, Korea; Okinawa, Japan; Honolulu, Hawaii

CEO:

Tom Shull President-COO: Mike Howard

Selected Operations and Services: Retail Stores; On-line Shopping Concessions; Catalog Services

Food Facilities; Gas and Auto Repair Military Clothing Stores; Movie Theaters

Vending Centers, State Department Commissaries

FY 2014 Sales: $7.392.2 Billion

AAFES Regions (5)

Eastern Region

Main Exchanges

Pacific Region Main

Exchanges

European Region Main

Exchanges

Western Region Main Exchanges Central Region

Main Exchanges

Guam,  Japan,  S.  Korea,  Okinawa  

Alaska  

Hawaii  

Puerto    Rico  

Italy  

Germany  

England  

Greenland  

NEXCOM Profile

FY 2014 Sales: $2.66 Billion

Established: 1946

Employees: 15,000

Headquarters: 3280 Virginia Beach Blvd. Virginia Beach, VA 23452 Phone: (757) 463-6200 Web site: www.navy-nex.com Major Distribution Facilities: Norfolk, VA; Chino, CA Pensacola, FL; Naples, Italy Honolulu, Hawaii; Yokosuka, Japan

CEO: Mr. Robert J. Bianchi

COO: Michael Good, SES

Selected Operations and Services:

Retail Stores; Concessions Food Facilities; Gas and Auto Repair

Authorized Uniform Stores Vending Centers; Ship Stores

Cuba

Guam

Puerto Rico

Japan

Hawaii

NEXCOM Districts (11)

Mid-South District

Guam District

Japan District

Hawaii District

Western District

Northwest District

Southeast District

Tidewater District (HQ)

Capitol District

European District

Northeast District

MCX Profile

FY 2014 Sales: $898.9

Established: 1897

Employees: 3543

Headquarters: 3044 Catlin Ave. Quantico, VA 23134-5103 Phone: (703) 784-3800 Web site: www.usmc-mccs.org Major Distribution Facilities: None

Director: Ms. Cindy Whitman Lacy

Deputy Director Business Operations: Ms. Jennifer Ide

Selected Operations and Services: Retail Stores; Concessions

Vending Centers; Gas and Auto Repair Food and Hospitality Facilities

MWR Programs

Marine Corps Exchanges (MCX) are a part of the Marine Corps Community Services (MCCS)

on the Marine Corps bases.

Yuma

Barstow

Quantico (MCX HQ)

Camp Allen

Henderson Hall

Cherry Point Camp Lejeune

Beaufort Parris Island

Albany

Twentynine Palms

Miramar & MCRD San Diego

Japan Iwakuni

Hawaii

Kaneohe Bay

Camp Pendleton

MCX Facilities (17)

CGES Profile

FY 2014 Sales: $158.2 Million

Established: 1945

Employees: 1,600

Headquarters: Battlefield Technology Center 1 510 Independence Pkw. Ste 500 Chesapeake, VA 23320 Phone: (757) 8424901 Lodges 26 Food & Beverage 24 Golf Courses 2 Fitness Facilities 33

Commander:

Captain Robert Whitehouse

Chief Operating Officer: John Reiley

Director of Merchandise

Beverly Hudgins Selected Operations and Services:

Retail Stores Gas Stations

MWR Programs Food Operations (franchised)

Vending Centers

CGES High-Volume Exchanges

Seattle

♠ Cape May

Cape Cod

Puerto Rico Hawaii

Honolulu

San Pedro

Alameda

Humbolt Bay

Petaluma

North Bend

Astoria Port Angeles

San Juan Borinque

Galveston Miami

Clearwater

St. Petersburg New Orleans

Mobile (2) Mayport

Charleston

Elizabeth City Portsmouth

Yorktown

Staten Island

Baltimore

New London

South Portland

North Coast,

Cleveland

Ketchikan

Kodiak

n  Central Buying Office

n  Core Customers: q  Patients (including relatives and friends)

q  Staff and Medical workers

q  Volunteers

n  Average Retail Store size: 1,500-1,800 sq. ft.

n  Approved items are placed in VCS’ Automated Merchandise Catalog (AMC). Items on AMC are available to each canteen for ordering merchandise.

VCS Profile

VCS Profile

FY 2014 Sales: $413.4 Million

Established: 1946

Employees: 3,100

Headquarters: #1 Jefferson Barracks Road Building #25 St. Louis, MO 63125-4194 Phone: (314) 894-1200 Web site: www.vcscanteen.com Major Distribution Facilities: None

Director: Mr. Ray Tober, SES

COO: Mr. Jim Leahy, SES

Chief Merchandising Officer Mr. Carey Filer

Selected Operations and Services:

Retail Stores, Food Operations (Cafeterias) Personalized Services, Vending

Exchanges - Main Stores

NOTE: Resale systems combined operate thousands of retail operations including Main Stores, Shoppettes, Troop Stores, Package Stores, Sport Shops, Lawn and Garden, Fast Food, Military Clothing Stores, Gas Stations, etc.

CONUS OCONUS TOTAL

AAFES 98 23 121

NEXCOM 68 32 100

MCX 15 2 17

VCS 189 4 193

CGES 59 5 64

Total 429 66 495

Exchange Sales Ranking vs. America’s Top Retailers

Top 200 Global Sales Ranking

WalMart 1

CVS 14

Costco 6

Home Depot 10

Target 11

Dollar Tree 144

Lowe’s 21

Best Buy 20

Sears 22

Kohls 49

Exchange 105 Source: NRF online 2012

Exchange Resale Systems Business Drivers

•  Pricing equal to or lower than best customer

•  Voluntary Price Reduction (VPR) •  Favorable payment terms

continued . . .

Marketing funds for:

ü In-store demos

ü Premiums, give-a-ways

ü Truckload and parking lot sales

ü Contests, sweepstakes

ü Clerk training

ü Scholarships

Exchange Resale Systems Business Drivers

•  Advertising funds for:

–  Weekly tabloids, In-store flyers –  Special programs

•  Prepaid freight

•  Warehouse allowances

•  Business Processes –  Vendor Managed Inventory (VMI)

–  Pre-ticketing for certain kinds of merchandise

Ship Stores Profile

FY 2014 Sales: $63.8 Million130 Ships-3 Stores ashore

Established: 1909

Headquarters:

3280 Virginia Beach Blvd. Virginia Beach, VA 23452 Phone: (757) 463-6200 Web site: www.navy-nex.com Major Distribution Facility: Yokosuka, Japan 130 Ships Globally

CEO

Robert J. Bianchi Vic President, Ship Stores Program:

Charlie Vaughn

Selected Operations and Services: Retail Stores; Vending Machines

Laundries; Barber Shops

What Makes Ship Stores Unique? •  Investment in inventory is

constrained –  limited storage and display

space •  Assortments reduced to best

selling SKU’s •  Majority of sales occur while

deployed •  Captive market when at sea •  Store hours restricted while in

port or repair yards •  Requires 24-72 hour

turnaround for deliveries

MWR/ Services MWR, GSA, Department of State

Morale, Welfare and Recreation

MWR Operations

MWR

MWR is a term given to a complete range of community support, quality of life programs, services, and activities that are provided to members of the Armed Forces and their families on military installations throughout the world.

Operations •  Each of the military services

operates MWR activities •  Each military service has its own

MWR organization, and while they manage similar activities, each does so in its own manner within the broad policy mandates of DoD

•  Operations are generally decentralized, but there is growing trend toward regional operations in Army & Navy.

Program Funding

•  MWR operations are funded with a combination of tax payer funds (appropriated) and self generated funds (non-appropriated) referred to as “APF” and “NAF” respectively

•  NAF is generated through the sale of goods and services by both MWR operations and the Exchanges (dividends)

Programs Categories

Source: DMDC

Categories Title Funds Program Examples “A” Mission Essential 100% APF Fitness Center, Intramural

Sports, Libraries, Rec. Centers

“B” Community Support 65% APF Child Dev. Center

35% NAF Youth Program, Outdoor Rec., Rec. Pool

“C” Business Operations 100% NAF* Clubs, Golf,Bowling,

Retail Stores, Snack Bars Restaurants, Lodging, Marinas

Category may determine type of contracting procedures utilized

q  APF: Defense Federal Acquisition Regulations Supplemental q  NAF: DoD and Service Specific Regulations **

n  DoD Directive 4105.67 *With some limited exceptions n  DoD Instruction 4105.71 ** www.defenselink.mil

MWR’s Most Frequented Facilities

Air Force Fitness Facilities Libraries Outdoor Rec. Clubs and

Entertainment

Army Fitness Facilities Gyms/fields Bowling Libraries ITT

Navy Fitness Facilities ITT Fast Food Venues Outdoor Rec. Gyms

Marines Fitness Facilities ITT Fast Food Venues Outdoor Rec. Gyms

The Military Market Facts Presentation has been brought to you by the American Logistics Association.

Advocates for Military Total Quality of Life

www.ala-national.org

American  Logis:cs  Associa:on