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DoD Awards Contract to Study Exchange Integration

By Staff Sgt. Alicia K. Borlik, USA
American Forces Press Service

WASHINGTON, June 16, 1998 – The Defense Department has awarded a $3 million contract to Price Waterhouse to study the military exchange systems for possible consolidation.

Over the next year, the consulting firm will get down to the nuts and bolts of the exchanges to see if a merger is in the services' and service members' interests. The bottom line is what's best for customers, said Buster Tate, the Navy's director of force support and family programs.

The contractor must study every operational aspect of the Marine Corps, Navy, and Army and Air Force exchanges. Tate said that means everything from talking to exchange commanders to visiting stores, gathering information for cost and risk analyses, and preparing detailed options.

Various organizations from the Office of the Secretary of Defense to the General Accounting Office have conducted consolidation studies over the past 28 years, most recently about a year ago. Lack of details doomed them, Tate said.

The service secretaries looked at the 1996 study and requested permission to do a thorough review using a qualified company that specializes in retail acquisition. Fred Pang, then-assistant defense secretary for force management policy, granted permission.

There is no predetermined outcome, Tate said of the exchange study. "We're starting with a clean sheet of paper."

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