By David VergunMarch 21, 2014
WASHINGTON (Army News Service, March 21, 2014) -- The Army & Air Force Exchange Service wants its customers to have an enjoyable shopping experience comparable to any of the large civilian retailers, said Thomas C. Shull, AAFES chief executive officer.
Subtle but important changes are taking place within the stores that might not be noticed by customers, he said, explaining that shoppers are desiring more "aspirational brands," such as Michael Kors.
The Exchange is bringing these brands to shoppers at competitive prices, both in-store and online, he said.
For example, during the last 21 months, the Exchange has opened 456 store-in-store concept shops and dozens more are planned this year, he said.
A store-in-store concept shop, he explained, is a well-defined section of the Exchange that offers a popular product assortment. Recent store-in-store concept shops include Michael Kors, Ashley Furniture and BareMinerals.
Another area that's popular is the Power Zone section, which offers the latest electronics, he said. To make room for that, the section that sells music and movie CDs and DVDs has been made smaller since those are no longer big-ticket items. About 900 less popular magazines have been removed from the racks as well.
Exchange concession stores continue to expand with popular new vendors being reviewed and added to the Exchange portfolio such as Pandora, Things Remembered, Men's Wearhouse, New Balance and Under Armour, he said, while name-brand vendors like GNC, H&R Block, RedBox and Starbucks continue to increase their visibility and expand their number of locations.
Mindful of the Army's emphasis that good eating habits can impact on the health of the force, Shull said the Exchange has been offering healthier eating options in its menu.
Unfortunately for a lot of retirees and those who serve in the Guard and Reserve, an Exchange might be far away from where they live. So it is improving its online presence, he said.
Shull said their website, shopmyexchange.com, is being reorganized and streamlined so that experience is comparable to what customers expect from a big civilian retailer. The reorganization isn't simply cosmetic as online logistics are being overhauled. He said the Exchange's goal is to ship all orders within 48 hours and have items delivered within five to seven business days, with a customer order online tracking system in place.
All of these efforts are focused on improving the shopping experience, an important objective as historically two-thirds of Exchange earnings benefit military quality of life programs through annual dividends, he noted.
Those efforts have literally paid off, he said, as the Exchange generated over $2.4 billion to the Family and Morale, Welfare and Recreation fund over the last 10 years.
The old acronym PX, which stood for Post Exchange, Shull said, was changed in 2010, to simply, the Exchange. The Exchange is the 43rd largest retail organization in the U.S., he said, with annual revenues of $10.3 billion.
Additionally, the Exchange is a major employer with 37,506 civilians and military personnel on its payroll, he said. Recently, the Exchange was named 2014 Military Spouse Employer by Victory Media, G.I Jobs and Military Spouse Magazines' publisher.
Improvements to the Exchange are being implemented during a difficult time of budget cuts and the drawdown, Shull said. Fortunately, these savings haven't come at the expense of people, as savings have been realized through a combination of retirements and efficiencies.
"Our two-year goal was to cut selling, general and administrative costs by $100 million," he said. "With three month to go, we've already exceeded that number by more than 50 percent."
Shull wants taxpayers to understand that the Exchange operates on non-appropriated funding, which means 97 percent of its revenues "come directly from the cash registers."
The Exchange operates retail and convenience stores, gas stations, restaurants, theaters, vending machines on post in all states, five U.S. territories and more than 30 countries.
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