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Sources: Exchange eyes opening online store to all vets

Apr. 29, 2014 - 06:00AM   |  
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Army and Air Force Exchange Service officials want to expand shopping privileges at the online exchange store to all honorably discharged veterans, sources said.
Army and Air Force Exchange Service officials want to expand shopping privileges at the online exchange store to all honorably discharged veterans, sources said. (Getty Images/iStockphoto)
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Army and Air Force Exchange Service officials want to expand shopping privileges at the online exchange store to all honorably discharged veterans, sources said.

That would open the online store to about 20 million veterans, according to a source familiar with the discussions.

AAFES officials contend the move would have no negative impact on current eligible shoppers — and would be a boon to revenues and profits that support military morale, welfare and recreation programs on installations.

AAFES, which refers to its brick-and-mortar stores and its online store as “The Exchange,” operates the website shopmyexchange.com for authorized customers of all branches of service.

Under Defense Department policy, the only veterans currently authorized as exchange patrons are those with honorable discharges who are rated by the Veterans Affairs Department as 100 percent disabled, or hospitalized where exchange facilities are available.

DoD spokeswoman Joy Crabaugh said there have been discussions, but no formal proposal, about opening the online store to all honorably discharged veterans.

If a proposal does come forward, she said, it would require extensive review by DoD, including a legal review that would determine whether DoD could unilaterally change the policy, without having to seek a change in law.

The Navy Exchange Service Command operates its own online sales website, myNavyExchange.com, which, like the AAFES site, is open to authorized exchange shoppers of any service.

NEXCOM has no plans to request or propose changes to its criteria for authorized shoppers, spokeswoman Kathleen Martin said. “However, we will certainly evaluate and respond to any proposals or initiatives presented to us,” she said.

AAFES distributes part of its profits to the services’ MWR programs, proportionately based on the branches of online shoppers.

With more customers, officials say they could make purchases on a larger scale like other online discount retailers, and invest in better technology and customer service. The larger scale — with limited increase in overhead — would boost profits, providing more contributions to MWR, the source said.

“This is a game-changer,” the source said, adding that within the first five years of ramping up the online store website to include a deeper, better and broader selection of items to accommodate the veterans’ population, officials project an increase in profits of $70 million to $100 million.

That would be a huge jump from the current financial situation for online sales. In 2013, AAFES’ online website had a loss of $4.7 million, spokesman Judd Anstey said.

But he said that loss “is reflective of the old site.” AAFES is launching a new, more shopper-friendly website in July, with an improved product mix, he said.

Joyce Raezer, executive director of the National Military Family Association, said her group doesn’t necessarily object to an expansion of the customer base for online shopping.

But AAFES first needs to shore up its current customer base, Raezer said.

“They aren’t marketing well to their current eligible base, so what makes them think they’ll be able to find enough veterans and be able to entice this new population to switch from other online shopping sites to the Exchange?” she said.

But a copy of an AAFES point paper obtained by Military Times states that officials believe the improvements to the website that are already in motion, and the ability to reach a broader customer pool, could help mitigate some of the challenges in sustaining the viability of the exchange benefit, such as troop drawdowns, cuts in installation MWR programs, and fewer customers living on base.

Some advocacy groups say opening the exchange online website to vets is an idea worth considering.

“This is a very interesting proposal ... worth further evaluation,” said Joe Davis, a spokesman for Veterans of Foreign Wars.

The Retired Enlisted Association also supports the idea in principle, “assuming there are proper controls so that only veterans have access,” said Larry Madison, national legislative director.

DoD’s Crabaugh said the Defense Manpower Data Center does maintain information on veterans. AAFES and the other exchanges use DMDC’s Defense Enrollment Eligibility Reporting System to verify customers shopping online.

AAFES officials reportedly contend that since the information fields are available in DMDC, the protection and transfer of data about veterans could follow the same authorization procedure now used to validate active-duty members, retirees and their dependents.

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