Contracting for Military Exchange Concessions

FPCD-77-79: Published: Nov 30, 1977. Publicly Released: Nov 30, 1977.

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Contracts to commercial businesses to run concessions on military installations are awarded to responsive businesses offering the most favorable prices or fees, regardless of business size. The military exchanges have no policies or procedures specifically to protect small businesses by using nonappropriated funds to procure their services although they have policies for procurements made with appropriated funds.

Review of the Army and Air Force Exchange Service contracting and management showed that small businesses successfully competed for contracts, but large businesses have received contracts to provide a greater share of some personal services in recent years. Procedures were adequate to keep contractors from "buying-in," and there was no evidence that former employees unduly influenced concession contracting. Haircut prices were reasonable, but Army recruit haircut prices should be kept low throughout basic training.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Secretary of Defense should require the Army and Air Force Exchange Service contracting officers to: (1) adequately document reasons why contracts are awarded early; (2) make sure that documentation to support contract changes is adequate for making such determinations at the time of the change and for postevaluation; and (3) offer reduced prices on follow up Army recruit haircuts.

    Agency Affected:


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