Words From the Director/CEO: How Your Dedication Strengthened the Benefit in 2024

Congratulations on another stellar year of serving those who serve! The Exchange is thriving, and credit is due to your never-ending commitment to serve our Nation’s Soldiers, Airmen, Guardians and the military community.

The Exchange is expected to exceed sales and earnings targets for FY 2024 (final results will be available after the third-party audit is finished this spring), providing higher-than-planned dividends for crucial Quality-of-Life programs that are essential to military recruiting, readiness, resiliency and lethality.

In a highly competitive retail climate, Team Exchange is delivering $1.6 billion in financial benefit annually. This video, produced by Corporate Communication’s Digital Media Network’s team, details the math of the calculation:

• $450 million in tax-free savings.
• $400 million in value through the MILITARY STAR card.
• $400 million in payroll and benefits for military spouses, Veterans and dependents.
• $370 million in earnings (based on $3.7 billion over 10 years).

No commercial retailer could do this – their shareholders would have consumed much of this value. This is a testament to the support only the Exchange can provide our military community.

MILITARY STAR expansion

After extensive planning, the Exchange Credit Program introduced a new MILITARY STAR card in September, establishing this unique financial fitness tool as the one card to use on military installations around the world.

The new card provides tap-to-pay, EMV (simpler, quicker and more secure checkout) and mobile wallet options. Expanded acceptance makes it easier for third parties to do business with the Exchange while reducing costs associated with credit card acceptance. Cardholders can use the MILITARY STAR card at more merchants across installations.

The ECP team beat its aggressive timeline, issuing 1.5 million cards to customers before the crucial Veterans Day holiday weekend. Use of the improved card among existing cardholders exceeded expectations as the Exchange Credit Program saw significant  year-over-year growth in new accounts opened.

 

The best tastes of home

The Exchange food team served more than 73 million meals in 2024 and expanded the Exchange’s portfolio of more than 1,400 restaurants. The team collaborated with restaurant partners to enhance training, increase operating hours when necessary and bring the most successful brands to more military locations:

Panda Express: Seven Exchange locations opened in 2024.The Feb. 20 grand opening at Grafenwoehr generated $22,672 in first-day sales, the biggest restaurant grand opening in Exchange history. The restaurant now has more than 30 Exchange locations, with at least two more planned for 2025.

Panera Bread: Three locations opened in 2025, at Forts Bragg, Drum and Cavazos. The Fort Bragg location is the first Exchange Panera with a drive-thru. Locations are planned for Forts Bliss and Gregg-Adams in the first half of 2025.

Qdoba: The fast-casual Mexican restaurant opened its first locations in the Pacific Region—on or off an installation—in August at Kadena Air Base and Camp Foster in Okinawa. Two opened  in September at USAG Humphreys.

Qdoba also opened at a new troop store at Fort Eisenhower and plans to open an additional Korea location in 2025 at Kunsan Air Base.

Also: The first Buffalo Wild Wings GO takeout restaurant opened on a military installation at Fort Riley … Cupbop, a “Korean BBQ in a Cup” restaurant that appeared on “Shark Tank” in May 2022, opened its first Exchange locations at Hill AFB, Mountain Home AFB and Fort Huachuca … Potbelly Sandwich Works opened its first two Exchange locations in 2024, both at Fort Bragg …

Sbarro pizza, pasta and salad restaurant added locations at Forts Bragg and Cavazos. Sbarros are planned for Fort Leonard Wood and Fort Carson in 2025 … Chipotle Mexican Grill opened its third Exchange location, at Fort Bragg’s Glider Express … the popular Five Guys burger restaurant drew long lines when it opened at Vicenza Ederle, serving the U.S. Army Garrison Italy community … And 58 CONUS Charley’s restaurants completed the launch of the brand’s point of sale system.

 

Quick-serve restaurants

QSRs hit a milestone in 2024, exceeding $50 million in sales, up 35% increase vs. 2023:

Hunt Brothers Pizza: In April, the Exchange celebrated the upgrade of the Tyndall AFB Express, which included Hunt Brothers’ 100^th Exchange location. Hunt Brothers now has more than 120 Exchange locations.

Chopz: The fast-casual salad-and-sandwich QSR expanded its reach at the Hurlburt Express, the Global Reach Mini Mall at Fort Bliss, Robins AFB Express, Fort Drum Mini Mall and the Laughlin AFB Express with Class Six. The Exchange has more than 25 Chopz locations worldwide.

Hot Stuff Kitchen: The grab-and-go restaurant opened 11 Exchange locations worldwide, including at Fort Sill’s renovated North Express. A versatile option for Expresses, which can curate menus for different mealtimes, Hot Stuff Kitchen offers chicken sandwiches, wraps and more. The Exchange now has more than 20 locations worldwide.

Express Kitchen: This new concept debuted in November at the Fort Drum Mini Mall as an add-on to Chopz. Intended for smaller Expresses, Express Kitchen’s menu includes breakfast empanadas, chicken wings, mini-tacos, pizza by the slice and more. More than 50 Express Kitchens are in the planning stages for 2025 and beyond.

Paavos Pizza: Another new player in the QSR lineup, Paavos opened its second Exchange location at Fort Sill’s North Express. Paavos Pizza offers thin-crust, artisan style pizzas, including a build-your-own option, allowing diners to choose sauces, cheeses, meats and vegetables.

 

Innovative services

The Services team continues to improve Quality of Life, emphasizing convenience and connectivity by offering unattended retail units (URUs) and advanced telecommunications.

Nearly 200 Exchange URUs opened last year, bringing the total to nearly 630 across almost 90 installations. URU openings in 2024 included a first in Europe at the Ramstein Exchange, and the first units went live in Japan at the Okinawa Consolidated, Yokota Air Base and Camp Zama Exchanges.

These self-serve units offer an assortment found in most convenience stores, including snacks, drinks and better-for-you options. They are especially well-received at smaller installations or inside barracks, hospitals and large headquarters, providing 24/7 access. The Services team continues to explore opportunities to enhance the customer experience through this format and plans to add 50 URUs in 2025.

The Exchange plays a vital role in keeping the military community connected. At 200 military installations worldwide, telecommunications infrastructure under Exchange management includes landlines (copper/coaxial/fiber), point-to-point radios, Wi-Fi access points, satellite dishes, cellular towers/small cells, including a small number of pay phones for basic trainees and even connectivity for prisoners in military correctional facilities.

This infrastructure provides broadband services to more than 150,000 customers and more than 1,000 government business customers daily. In 2024, the Exchange added 15 cell towers and 66 small cells for a total of 45 towers and 205 small cells. The telecom team is working on an additional 55 infrastructure projects to improve cellular and broadband internet connectivity.

 

Retail optimization

In September, the Exchange and Bass Pro Shops officially announced a collaboration to offer Bass Pro hunting, camping and fishing gear as well as apparel at ShopMyExchange.com. This was another major step in delivering the best brands to authorized shoppers tax-free. Recent additions include Athleta, Wrangler, Casper, Sleep Number, Stanley and more in stores and at ShopMyExchange.com as well as expanded national brands, such as Old Navy and The Home Depot, at PXs and BXs.

As the brand-name portfolio grows, Merchandising, eComm and region teammates are carefully editing and curating the assortment selection to more quickly respond to our customers’ changing needs and preferences—work that will continue in 2025. Bass Pro is just one example of the direct-to-consumer agreements and collaborations that are strengthening the Exchange benefit and extending the tax-free savings authorized shoppers enjoy.

 

Reinvesting in the shopping experience

The Real Estate directorate completed $164 million in projects. This included the completion of 22 Express 2.0 projects.

Highlights include:

• A new $17.2 million, 14,000 square-foot Express opened at Fort Irwin with enhanced food options, a 20-pump gas station and more. The facility replaced two Expresses and a Class Six.
• A new $11 million, nearly 13,000 square-foot troop store opened at Fort Eisenhower, providing added convenience for Soldiers, advanced individual training students, Airmen, Guardians, Sailors and Marines.
• The new Glider Express, a $13.3 million, 12,272 square-foot store, opened at Fort Bragg. The store, which is in the heart of the 82^nd Airborne Division training area, provides greater accesses to fuel and dining options on post.
• A new, nearly $8 million Express with gas opened at Osan Air Base. The 5,200-square-foot store replaced three ancillary buildings and created a new Express environment with QSRs for the community.
• A nearly $2.5 million upgrade to the JBSA-Lackland’s North Troop Express, including the addition of Hunt Brothers Pizza and Hot Stuff Kitchen, as well as new murals added throughout the store; updated lighting; polished concrete flooring; an expanded Snack Avenue with sports nutrition items and better-for-you snacks; and four relocated self-checkout kiosks to provide more space for shoppers.
• A $6.5 million upgrade to the Fort Hunter Liggett Troop Store in California. This was a true collaboration with the Army as part of the Exchanges Quality-of-Life initiative for remote and isolated locations, the upgrade brought a store built in 1976 to current standards, including $2 million from the Army for an electrical upgrade, new heating and air conditioning, new coolers and freezers and a Hunt Brothers Pizza.
• The addition of Bath & Body Works mall stores at Forts Bragg and Moore, Joint Base Andrews and Schofield Barracks.

Family serving family

Team Exchange once again delivered amazing service and support to Warfighters and families in 2024. In the past ten years, the Exchange has provided more than $15 billion in value to our military community. Each of you play a key role in strengthening military readiness, resilience and lethality.

It is truly an honor to serve those who serve with you.

Veteran For Life!

Very best,

Tom