Commissary officials on Monday unveiled new savings requirements for the system's 238 stores worldwide, setting the framework on which prices will be based under an upcoming plan known as "variable pricing."
Currently, products at the commissary are sold at-cost plus a five percent surcharge that pays for store upkeep and new construction. All other overhead costs are taxpayer funded.
But a new pricing model passed by Congress last year allows the Defense Commissary Agency (DeCA) to instead use a variable pricing plan, with prices based on a percentage of savings over the same items sold off base and determined on a region-by-region basis.
For shoppers, that means commissary prices will fluctuate dependent on what part of the country they are in and the cost of goods sold at off-base stores in those areas. DeCA's regional savings index, released Monday, will dictate the percentage of savings the system must maintain over off-base grocers, officials said in a release.
According to the chart released Monday, the 36 commissaries in New England will have 21.4 percent savings over local off-base retailers; 30 commissaries in the South Atlantic region will have savings of 19.9 percent; 33 stores in the South Central region will have savings of 18.1 percent; 31 stores in the Pacific region of the U.S. will have savings of 20.9 percent; 20 stores in the Mountain region will have 17.6 percent savings; 18 stores in the North Central region will have 20.2 percent savings; nine stores in Alaska and Hawaii will have 32.6 percent savings; and 61 stores outside the U.S. will have 44.2 percent savings.
The average savings at commissaries across the U.S. will be 20.2 percent, officials said, while the global average across all 238 stores will be 23.7 percent.
"The enhanced savings calculation will allow us to measure the benefit more specifically and more often," commissary chief Joseph Jeu said in a statement. "Although market fluctuations will cause prices of grocery products to increase and decrease -- as they do today -- commissary patron savings levels will remain constant."
Information on when the new savings standards will be put in place or a list of specific stores included in each region was not immediately available.
The regional savings were calculated to include applicable off-base local and state food sales tax and the five percent commissary surcharge, according to a fact sheet. For overseas stores, the savings was calculated using the cost of living index, the fact sheet says. Average regional prices and savings will be refreshed monthly, according to the fact sheet.
The variable pricing rule was included in the 2017 National Defense Authorization Act, signed by former President Barack Obama late last year, in an attempt to decrease the $1.3 billion in taxpayer funding the system receives annually.
-- Amy Bushatz can be reached at amy.bushatz@military.com.
