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"No Profit" Operation

Question Answer

How does DeCA use all the profit that it makes on commissary sales?

Although commissaries collectively realize sales of about $5 billion per year, there is no profit generated on these sales.

By law, commissaries are required to sell goods at prices that are set at a level to recover the cost of goods, with no profit built into these prices. There are also very stringent legal controls on the ways that DeCA can use taxpayer monies that Congress provides to operate commissaries.

Because commissaries are prohibited by law from making profit on goods sold, and because of the stringent controls on use of funds provided for commissary operation, commissaries cannot use a lot of merchandising practices that commercial stores use routinely.

For instance, commissaries cannot "double" (or otherwise increase) the face value of coupons, commissaries cannot sell goods below cost to create a low price "image," commissaries cannot pay a "rebate" to patrons who return bags for reuse, or who use non-disposable cloth bags, and commissaries cannot donate money or products to an individual or organization, however worthy.

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