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New in 2017: Military commissaries will shake up grocery prices

December 24, 2016 (Photo Credit: Defense Commissary Agency)
Next year brings fundamental changes to the military commissary benefit as Defense Department officials test price changes on some groceries in an effort to offset the $1.4 billion it costs to operate the stores each year.

Commissaries currently sell products at cost, plus a 5 percent surcharge. And while officials contend the taxpayer subsidy can be reduced without affecting customers' bottom-line savings, the National Military Family Association says it remains “skeptical that the Defense Commissary Agency has the expertise to implement these changes while still preserving the savings military families rely on.” 

Pilot programs expected to start at the end of January or in early February will use two approaches: one focused on grocery item categories, the other on store locations. 

Officials are negotiating with suppliers to lower prices on about 8,000 items that the commissaries, in turn, will mark up, using the additional revenue to pay for operating costs.

Additionally, officials will adjust prices on about 1,000 items across about 10 test stores, lowering prices on goods that commercial stores market aggressively: bananas, for example, milk, detergent and soda. The aim is to be more competitive with prices military consumers may find off base, raising prices on other items that have traditionally offered a bigger savings than those found in commercial stores. Again, the difference would go toward offsetting operations costs. 

Beginning in May, the commissary agency also will start offering its own private label products, sometimes called generics, comprising an initial assortment of about 400 products.

Meanwhile, defense officials have been exploring other expense-reduction ideas, including a plan to privatize all or part of the commissary system.

Karen Jowers covers military families, quality of life and consumer issues for Military Times. She can be reached at kjowers@militarytimes.com .
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