As your Exchange Europe/SWA Commander, I want to give you advance notice of price increases we plan to implement with regard to fast food meals and haircuts. Due to regulatory and policy direction, and the current fiscal environment, we need these i...

Europe Region Commanders,

1. As your Exchange Europe/SWA Commander, I want to give you advance notice of price increases we plan to implement with regard to fast food meals and haircuts. Due to regulatory and policy direction, and the current fiscal environment, we need these increases to provide the excellent customer service our mission demands. I assure you we are holding these increases to the absolute minimum required.

2. Our value meal prices will go up 10-30 cents, and select movie snacks up a dollar. This is driven by Congressional mandate that our CONUS fast food prices match off-post eateries, and our overseas policy is to baseline CONUS prices, then adjust for local operating costs. Unfortunately fast food costs are going up (of 48 CONUS chains surveyed, 92% are raising prices), and our food worker wages are $5.23 higher than CONUS. With many of our ingredient and labor costs in euros, even more price pressure comes from the euro?'s recent 15% increase to the dollar.

3. Our haircut prices will also rise 50 cents to 2 dollars in most locations this spring, with other locations increasing an additional 2 dollars this summer. These prices are driven by our vendor contracts, our worldwide pricing policies, and local economies. Our barber operations are contracted, and our policy sets haircuts 25% below off-post prices. Unfortunately, off-post haircuts across the Europe region are extremely expensive, and our contracted vendors cannot compete to hire or keep good barbers given the lucrative off-post haircut markets. Additionally, the falling dollar has cut into our barbers?' earnings, since our haircut prices are in dollars but local barbers are paid in Euros.

4. In summary, both the current fiscal environment and our current regulations and policies drive higher prices in order to keep providing quality goods and services to our Airmen, Soldiers and their family members. The new food prices will take effect 15 February 2014, and new haircut prices on 1 March 2014. I am carefully managing this to keep as much value as possible in the pockets of our Service men and women.

Fredrick J. Hannah

COL, LG

Commander, Exchange Europe/SW Asia