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Frequently Asked Questions

  • Why should I do business with the Military channel?

    • This is an excellent channel to create brand loyalty—the demographic skews heavily toward 18-30 year olds and young families.  One in four active duty military rotates to the civilian world each year.  Loyal habits can be created while military personnel are on active duty.  Providing U.S. products for military personnel around the world helps keep morale higher and provides for better national security.

     

  • Can I make a reasonable profit in the Military channel?

    • Pricing in this channel, like all channels, is important.  Military personnel enjoy additional benefits that are not available in the civilian market i.e., no taxes are charged on most products and Commissary sales are subsidized by the government so goods are essentially sold at cost—both of these factors lower prices.  Many manufacturers also pass on additional savings from the supply chain or other efficiencies to lower prices.  The government does not expect manufacturers to price at unacceptable margins.

     

  • How will I manage all of the complexities of doing business with the government?

    • Most manufacturers work through a broker system that handles contracts and insures that regulations are met.  This greatly simplifies the process.

     

  • Is the Military business growing or declining?

    • Today, the active duty military is being reduced which is causing some small declines in the business.  There are normally somewhere around 1.2 - 1.4 Million active duty military personnel—the actual shopping base in the channel is 12 - 13 Million people (active duty, retirees, Reserve and family members).  This shopping base tends to keep the business steady to growing slightly.

     

  • Are there special laws regarding pricing in the Military channel?

    • Prospective vendors in the military channel should always check with their own consul to verify and agree on an interpretation of the laws.  The binding documents relative to pricing in this channel are the contracts signed and agreed to by manufacturers.  One “myth” is that military customers must receive “most favored” pricing status.  Most attorneys will say that this is not the case.