Rant #2010: In the Navy

Rarely have I let my two writing worlds collide on this blog, but something happened on Tuesday that I feel is worth writing about here.

Before I go into this story, let me explain to you what I write about. The writing that helps put bread on my table has to do with an area called “military resale,” which is basically military stores for service members and their families, plus military retirees.

These are commissaries, which are akin to civilian supermarkets, and exchanges, which are department stores.

At one time, each military service—the Army, Air Force, Marines, Navy, and Coast Guard—had their own commissaries, but in 1991, the military commissaries were consolidated under the Defense Commissary Agency (DeCA). Each of the services continues to run their own exchange stores, under the names the Army & Air Force Exchange Service (AAFES); the Navy Exchange Service Command (NEXCOM); the Marine Corps Exchange (MCX); and the Coast Guard Exchange (CGX). Also existing under the military resale umbrella is the Veterans Canteen Service (VCS), which has stores in military medical facilities across the country.

Military resale is a multi-billion-dollar-a-year industry, and during fiscal 2016, these stores generated more than $15 billion in sales, a good portion of which is poured back into the services for programs for service members, their families and retirees.

Few outside of the military know about this industry and its stores, but these facilities provide products, goods and services for military members and their families, and they often do business in out-of-the-way places serving this clientele, and do so on a worldwide basis.

Anyway, now that you have that basic background, I will provide some further background before I delve into the main story.

There has been a lot of scuttlebutt in Washington about trimming governmental costs, and many people, including those with political power, believe that doing away with these stores might be a great way to save the couple of billion dollars a year it costs to run them.

They believe that a penny saved is a penny earned, and the money devoted to them—DeCA gets a yearly stipend, the other stores do not—might be better used elsewhere.

They kind of figure that the civilian industry might be able to shoulder the burden presented by the possibility of shutting down the military stores, with service members and their families continuing to get their military discount—cheaper prices and no sales tax—with this money still funneling back to the government to be used for various military programs and services.

Think “Walmart Military” if you will.

Others think consolidation is the key—where the commissaries and exchanges are run under the same umbrella agency—and this would also cut costs.

Many say that this would not work, because commissaries and exchanges are two different retail animals that cannot mesh.

But on Tuesday—and now I am finally getting to the news story—a move was made that might give a small window into what the politicians and the military resale business are actually thinking.

Robert Bianchi, a former Navy rear admiral, since retired, who has headed NEXCOM as its CEO for the past five years, was named by the Department of Defense (DoD) as DeCA’s interim director and CEO, meaning that for probably the next eight months, he will be both the top guy at the Navy stores and the top guy at the commissaries.

This has never happened before, and I will bet that some people familiar with this industry are scratching their heads, wondering how he will do both jobs at once.

More importantly, in my mind, this could be a precursor toward a total consolidation, and perhaps this could be a trial run for such a situation to happen.

Legislators have been talking about at least refining the way military resale does business, because it affects not just military members and their families, but it also effects taxpayers.

Why not save some money by putting all of these stores—and there are several thousand stores around the world that are run by the military services, if you include not just main stores, but also convenience stores, gas stations, fast food outlets, and many, many other venues—under one governing body?

Many people have been opposed to such an idea, saying that it simply cannot work and would dilute or obliterate what they refer to as “the military benefit,” but with Bianchi being named to run both the commissaries and to stay on as the leader of NEXCOM, this whole thing smacks as a trial run to a full consolidation scenario.

Rather than jump into it whole hog, why not see, for a couple of months, if something like this can work, on a smaller scale?

Sure, Bianchi is not running all of the exchanges, just NEXCOM, while he will be heading DeCA, but it might give proponents of consolidation a small sample size to work with in proving their point that such a situation could work.

Look, I realize that this story means little or nothing to about 99 percent of the country’s population, but to that 1 percent, this could turn out to be a huge story.

But whatever the case, this is an interesting story, and bears worth watching over the next several months.

(And now, as a byproduct of me writing about this, you have a full peak into what I do for a living, and quite frankly, why this blog is so important to me as an outlet to use my writing chops to write about other things.)