Army and Air Force Exchange Service
|Department store, Government agency|
|Headquarters||3911 South Walton Walker Boulevard, Dallas, Texas,
United States 75236
Number of locations
|2,500 (all facilities)|
|Tom Shull, Director/CEO|
Number of employees
|Parent||United States Department of Defense (1895–present)|
The Army & Air Force Exchange Service (Exchange) or "AAFES," is the retailer on U.S. Army and Air Force installations worldwide. The Exchange is headquartered in Dallas, Texas, and its Director/chief executive officer is Tom Shull.
The oldest and the largest of the Department of Defense's exchange services, the Exchange operates department stores, convenience stores, restaurants, movie theaters and an Internet shopping site to serve soldiers, airmen and their families. In addition to U.S. bases in Belgium, Germany, Italy, United Kingdom, Turkey, South Korea and Japan, the Exchange operates stores for U.S. troops in Iraq, Afghanistan and other countries in the region. The Exchange ensures soldiers and airmen have access to U.S. goods and services, wherever they serve.
In addition to their retail support for the military, the Exchange also outfits troops with combat uniforms at cost, and serves school lunches for children attending Department of Defense Schools overseas.
Starting Veterans Day, Nov. 11, 2017, military exchanges will offer online exchange shopping privileges to an estimated 13 million honorably discharged veterans. The exchanges launched VetVerify.org in June 2017, allowing veterans to verify their eligibility ahead of the benefit's start date.
The first exchanges were established on 25 July 1895, when the War Department issued General Orders Number 46 directing post commanders to establish an exchange at every post. Before the formation of the Exchange Service, U.S. military forces purchased provisions from bands of peddlers known as sutlers who followed the army.
The Army Exchange Service was formally established in 1941, and became the Army & Air Force Exchange Service in 1948 following the formation of the Air Force.
Since its establishment, the Exchange has been involved in 14 major military operations (to include World War II, Korea, Vietnam, Grenada, Panama, the Balkans and Operations Enduring and Iraqi Freedom) as well as several dozen humanitarian and disaster relief contingencies.
Structure and funding
Part of the Department of Defense, the Exchange is directed by a board of directors responsible to the secretaries of the Army and Air Force through the Chiefs of Staff. As a non-appropriated fund activity, the Exchange self-funds 97 percent of its operations, with revenue coming from the sale of goods and services. The majority of the 3 percent in appropriated funds is used to fund overseas operations.
In 2012, Tom Shull became the Exchange's first civilian Director/CEO, having previously served as an executive with Wise Foods, Inc., Hanover Direct, Inc., Barneys New York and Meridian Ventures. A West Point graduate, Shull served as an infantry company commander and held assignments at the White House and National Security Council.
In 2015, Shull's emphasis on intensifying national brands, growing concessions and Express stores, strengthening the Exchange's web presence and reducing costs led the Exchange to record operating earnings of $402 million, every dollar of which was reinvested into the military community. This performance, which occurred despite military personnel downsizing of 11 percent since 2011, represents an increase of three percentage points in terms of profitability, and is on par with or exceeds that of Walmart and Target.
Members of the Exchange's 13-member board of directors include Lt. Gen. Gina Grosso, Deputy of Chief of Staff for Manpower, Personnel and Services, Headquarters U.S. Air Force; Lt. Gen. Aundre Pigge, the Army's Deputy Chief of Staff, G-4; U.S. Army Sgt. Maj. Daniel A. Dailey and Air Force Chief Master Sgt. James A. Cody.
One hundred percent of Exchange earnings are invested back into the military community. Two-thirds of Exchange earnings support Army Morale, Welfare and Recreation (MWR), Air Force Services, and Navy and Marine Corps quality-of-life programs, while the remaining third is used for new store construction and facility costs at no cost to the federal government.
In 2016, the Exchange reported $384 million in earnings. Of this amount, $225 million was reinvested into installation quality-of-life programs including child development and fitness centers. In the past 10 years, the Exchange has distributed more than $2.4 billion for MWR to fund quality-of-life improvements.
The Exchange operates more than 2,500 facilities, including main stores, convenience stores, military clothing stores and theaters, across 50 U.S. states and 33 countries. Additionally, the Exchange has nearly 1,500 quick-serve restaurants such as Taco Bell, Burger King, Popeyes, Subway and Starbucks as well as over 3,300 concession operations. Authorized patrons of the Exchange include Active Duty, Reserves, National Guard, retired members of the U.S. uniformed services, recipients of the Medal of Honor, honorably discharged veterans certified 100% disabled by the United States Department of Veterans Affairs, or when hospitalized and their dependents by the presentation of the U.S. Uniformed Services Privilege and Identification Card.
Modern base and post exchanges (called BX in the Air Force, PX in the Army) provide tax-free goods – including name brands such as Michael Kors, Coach, and Ralph Lauren – to authorized shoppers. In addition, some Exchanges host concession malls with a variety of vendors and storefronts.
In November 2010, the Exchange unveiled Freedom Crossing at Fort Bliss, a $100 million outdoor mall anchored by a 217,000-square-foot Exchange Main Store and including a children's play area, outdoor dining patios, shaded landscaped areas, outdoor seating, an outdoor fireplace, an interactive fountain, a lawn for community events and concerts, and more than 40 storefronts and restaurants. The mall is the first of its kind on a United States armed services base.
The Exchange employs nearly 35,000 associates worldwide in the United States, Europe, the Pacific and the Middle East. Of these, about 27 percent are military spouses or dependents, 10 percent are veterans and 2 percent are active duty, reserves and the national guard. The Exchange has been named a Military Friendly Employer by Victory Media, publisher of G.I. Jobs and Military Spouse magazine, for five consecutive years, most recently receiving the publisher's Silver Award. In all, about 88 percent of the Exchange's associates are connected in some way to the military.
Since 11 September 2001, more than 4,400 Exchange associates have deployed to combat zones in Iraq and Afghanistan to support troops in combat operations. The Exchange currently operates 49 stores in contingency zones in countries such as Afghanistan, Kuwait, Iraq, Saudi Arabia, Jordan, Qatar, United Arab Emirates, Romania, Cyprus, Bosnia and Kosovo.
Military Star Card
The Exchange also operates and funds the Exchange Credit Program (ECP), a program established by Congress in 1979 to protect service members from predatory lending and offer responsible credit solutions to customers.
The Exchange Credit Program's Military Star Card counts approximately 2 million cardholders from all branches of service, including qualified dependents, among its members. The Exchange Credit Program markets Military Star as the "one card solution" for all purchases made on military installations. Like the Exchange, the Exchange Credit Program contributes a significant portion of its earnings to morale, welfare and recreation programs, furnishing $639 million to MWR programs over the last 10 years.
According to an October 2016 report by CreditCards.com, the Military Star Card has the lowest flat interest rate among retail-branded credit cards.
- "The Army & Air Force Exchange Service 2016 Annual Report" (PDF). The Army & Air Force Exchange Service. 11 August 2017.
- "The Army & Air Force Exchange Service 2015 Annual Report" (PDF). The Army & Air Force Exchange Service. 26 September 2016.
- "Your questions answered about the new veterans online shopping benefit". Military Times. 10 June 2017.
- "The Exchange – About Exchange – Public Affairs – Press Releases".
- "Exchange Quick Facts". ShopMyExchange.com. Army & Air Force Exchange Service. Retrieved 29 January 2016.
- "Civilian CEO moves to modernize military's retail business". LATimes.com. Los Angeles Times. Retrieved 27 March 2013.
- "Exchange director/CEO focuses on making life better for Airmen at Creech, Nellis AFBs". AerotechNews.com. Nellis Bullseye. Retrieved 4 November 2016.
- "This week, the Soldier for Life... – Soldier for Life | Facebook". www.facebook.com. Retrieved 6 March 2017.
- "Exchange Leadeship". ShopMyExchange.com. Army & Air Force Exchange Service. Retrieved 11 January 2017.
- "Honorably discharged veterans will soon get to shop tax-free". APNews.com. Associated Press. Retrieved 11 August 2017.
- "Benefit Fact Sheet". MyArmyBenefits.com. U.S. Army. Retrieved 26 September 2016.
- "The Exchange – Exchange Stores – Authorized Patrons".
- Avila, Celina (5 November 2010). "More New Mall Opens on Fort Bliss". KVIA TV. Retrieved 29 January 2016.
- Poe, David (28 October 2010). "AAFES commander Casella said Freedom Crossing at Fort Bliss ready to shine Nov. 5". Army.mil. Retrieved 29 January 2016.
- "The Exchange – About Exchange – Exchange Quick Facts". Retrieved 26 September 2016.
- "Is the Exchange (Army & Air Force Exchange Service) a Military Friendly Employer?". MilitaryFriendly.com. Victory Media. Retrieved 11 January 2017.
- "Army & Air Force Exchange Service named 'Military Friendly'". HookeleNews.com. Hookele – Pearl Harbor – Hickam News. Retrieved 29 December 2017. Check date values in:
- "Exchange By the Numbers". ShopMyExchange.com. Army & Air Force Exchange Service. Retrieved 29 January 2016.
- "About ECP". MyECP.com. Exchange Credit Program. Retrieved 29 January 2016.
- "30% Interest for a Store Credit Card". PR Newswire. PR Newsire. Retrieved 20 October 2017. Check date values in:
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