MILLIONS MORE VETS TO BE ABLE TO SHOP AT EXCHANGES ONLINE
After two years of study and debate, the Department of Defense has made a policy change, effective next November, to allow 16 million honorably discharged veterans to shop online for discounted military exchange products.
Peter K. Levine, acting undersecretary of defense for personnel and readiness, signed a memorandum Wednesday announcing the benefit expansion, effective Veterans’ Day Nov. 11, and giving Congress the required 30 days’ notice before actions begin to implement the plan.
Months of preparation are needed to make e-shopping portals more robust and to allow the Defense Manpower Data Center (DMDC) time to create software for verifying veterans’ status using Department of Veterans Affairs records.
Several million vets already are eligible to shop in exchanges -- on base or on line -- because they are active or reserve component retirees, or 100-percent disabled from service-connected injuries or ailments, or Medal of Honor recipients.
Thomas C. Shull, chief executive officer of the Army and Air Force Exchange Service, led a three-year quest to expand online exchange shopping to all honorably-discharged veterans with access to computers. It cited two reasons.
One was to reward their service with exchange product savings that, on average, will be near to 20 percent versus commercial department store prices when military exemption from state and local sales tax are considered too.
Shull’s other purpose was to increase exchange revenues to help offset troubling declines due to the drawdown of active duty forces, base closures and the end of military tobacco discounts for the higher priority of healthier populations.
The Navy, Marine Corps and Coast Guard exchange services joined Shull and AAFES in pushing for the shopping benefit expansion. They worked with Levine’s office and with resale board executives in refining the proposal.
The online benefit does not extend to veterans’ dependents, although spouses and family members theoretically could use the authorized customer's log-in credentials, given the nature of an online shopping benefit.
Exchange officials project that expanding online shopping will result in $1.8 million in added annual fixed costs to handle the larger customer base. However, they also project added sales and revenue, which will more than offset any added operating or order-fulfillment costs. Higher net earnings are seen boosting exchange dividends to support on-base morale, welfare and recreational activities.
With DMDC verifying shopper identifies electronically, the department will not have to produce special identification cards. DMDC estimates that 13 percent of eligible veterans, primarily those who served before 1981 might not be in their data base when the shopping benefit becomes available. Presumably guidance will be issued for veterans who might have access problems initially.
Defense officials believe they have mitigated concerns previously raised on expanding the exchange benefit. These included worries it would dilute the benefit for currently authorized patrons, increase appropriated funding costs, reduce state and local tax revenues for civilian communities and harm commercial retailers.
An audit of public comments to earlier news articles on the plan showed 90 percent support for veterans online shopping. Also, the online benefit should have no impact need for taxpayer support of certain exchange operations. Total sales are expected to climb annually by from $185 million to $525 million. But that range is viewed as insignificant against $300 billion in online sales reported across the retail industry, thus muting complaints retailers.
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