MONITORING COMMISSARY PATRONS’ SAVINGS IN AN ERA OF REFORMS
When asked about the current level of savings for commissary shoppers in an era of sweeping reforms, the interim director of Defense Commissary Agency (DeCA), retired Navy Rear Adm. Robert Bianchi, referred to results of a price comparison survey conducted in 2016 and released in late January last year.
It showed average savings at commissaries “globally” were 23.7 percent compared to prices at commercial grocery stores. More specifically, patron savings averaged 20.2 percent at stateside commissaries and 44.2 percent overseas.
The same survey also showed average patron savings varied widely across U.S. regions, from a high of 32.6 percent in Alaska and Hawaii to a low near 18 percent for commissary shoppers across the South Central and Mountain states.
Bianchi and staff said it is the regional cost saving targets that DeCA monitors monthly and, in finer detail, quarterly, to ensure that steps to transform commissaries into more business-like stores are not diluting patron savings.
Price savings by region are being tracked on “a monthly basis via our syndicated data and [on] a quarterly basis via manual shops [of local stores] and using syndicated data,” a DeCA spokesman explained.
The larger price comparison survey released a year ago established a new method for calculating savings that included a proportion of prices for private label or store brands. This irked patron advocacy groups because, at the time, commissaries didn’t sell their own private label goods. The concern was that the timing served to dampen the baseline savings targets set, which DeCA, by law, must sustain forever more.
This occurred long before Bianchi become interim DeCA director last November to lead commissary transformation while also serving as chief executive of the Navy Exchange Service. Bianchi said he believes the baseline for savings, which use regional price comparisons and private labels, more accurately reflects the real value of the benefit. The previous method, which led to claims that patrons saved more than 30 percent, compared commissary prices against average commercial prices for brand goods only nationwide, ignoring popular private labels.
Steps transforming commissaries include: replacing the traditional cost-plus-a-surcharge pricing with variable pricing based on regional markets; offering DeCA-brand or private label goods as low-priced alternatives to name brands; cutting the assortment of national brands on shelves and negotiating more competitive pricing for surviving brands with brokers and manufacturers.
Patron savings are real and substantial, Bianchi said. “But messaging that, connecting that for the customer, becomes important,” and variable pricing is key.
Commissary savings can get distorted, Bianchi said, when, for example, a shopper walks into a commercial supermarket and the first item seen are bananas selling for 39 cents a pound versus 52 cents seen at the commissary.
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