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A cost analysis of direct cash compensation in lieu of operating military commissary stores

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Author
Smith, Christopher G.
Date
2016-06
Advisor
Menichini, Amilcar
Second Reader
Cunha, Jesse
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Abstract
The Defense Commissary Agency (DeCA) provides groceries at cost (cost consists of the purchase price, a 1 percent markup on select grocery items to cover the cost of inventory loss during normal operations, and the cost of transportation to the store, not including overseas transportation) plus a 5 percent surcharge to military families worldwide. DeCA relies on appropriated funding to operate, and significant budget cuts by the Department of Defense threaten the current operation model. This thesis will evaluate whether direct cash compensation to service members would reduce costs to the DOD while still providing the current benefit that DeCA provides them. This thesis will also provide an estimate of the monetary value of the commissary benefit to service members and the monetary value of the commissary benefit in remote locations. The research will incorporate data extracted from financial statements from DeCA and from military demographic data. This thesis finds that it would be less expensive over time to continue operating the commissary system as is, rather than offer direct cash compensation to military service members for at least the next twenty years.
Description
MBA Professional Report
Rights
This publication is a work of the U.S. Government as defined in Title 17, United States Code, Section 101. Copyright protection is not available for this work in the United States.
URI
http://hdl.handle.net/10945/49386
Collections
  • 1. Thesis and Dissertation Collection, all items
  • 7. Master of Business Administration (MBA) Professional Projects

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